CI&T (CINT) Q1 2025 Earnings Call May 13, 2025 04:30 PM ET Company Participants Cesar Gon - CEOBruno Guicardi - Co-Founder of CI&T and President of North America & Europe OperationsStanley Rodrigues - Chief Financial OfficerVitor Tomita - VP - Equity ResearchGustavo Farias - Associate DirectorBryan Bergin - MD - Equity ResearchPuneet Jain - Associate - Equity ResearchBruno Guicardi - Co-Founder of CI&T and President of North America & Europe OperationsMaria Clara Infantozzi - Equity Research Associate Cesar ...

CI&T (CINT) Q1 2025 Earnings Call May 13, 2025 04:30 PM ET Speaker0 strategy. Speaker1 Thank you, Cesar, and good afternoon, everyone. I'm excited to share our progress regarding our people in this first quarter of the year. We ended Q1 with 7,400 employees, a 21.6% increase compared to Q1 twenty twenty four. This growth demonstrates our commitment to strengthen our teams and cultivating the next generation of leaders in technology. As part of our NextGen program, we successfully onboarded 420 trainees. Thi ...

1Q25 investors .ciandt.com Hello, We are your CI&T presenters today: Eduardo Galvão IR Director Cesar Gon Founder & CEO Bruno Guicardi Founder & NAE President Stanley Rodrigues Partner, CFO Submit your question via email to investors@ciandt.com Q&A SESSION investors.ciandt.com SAFE HARBOR AND NON-IFRS MEASURES FORWARD-LOOKING STATEMENTS This presentation includes forward-looking statements within the meaning of the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995. ...

Consumer Sentiment and TV Viewing Habits - Cint's research indicates that 73% of U.S. respondents consider affordability a significant factor in their summer travel plans, with 39% labeling it a major concern [6] - 62% of respondents primarily consume TV via streaming services, nearly doubling the combined viewership of traditional cable (24%) and satellite (8%) television [1][2] - 60% of respondents report that the current economic and political climate is influencing their choice of travel destinations [6] Advertising Implications - There is a strong consumer preference for ad-free tiers on streaming platforms, with over half of respondents likely to stop using a service if bombarded with ads [2] - The rise of streaming and the shift in consumer behavior present dynamic opportunities for advertisers to focus on delivering personalized and meaningful ad experiences [3] - Smaller audiences tuning into Connected TV (CTV) ads may impact ad pricing as consumers become more budget-conscious [2] Economic Influence on Consumer Behavior - Economic uncertainty is influencing consumer spending trends, particularly in summer travel plans, which can serve as an early indicator of broader spending behavior [3] - 58% of respondents say the economic climate is impacting their transportation choices for summer travel [6]

Group 1: CI&T Inc. (CINT) - CI&T shares increased by 6% to close at $5.80, following a notable trading volume, contrasting with an 8.4% loss over the past four weeks [1] - The company is experiencing strong demand for AI-powered modernization solutions, particularly through its CI&T FLOW platform, leading to double-digit revenue growth and margin expansion [1] - The consensus EPS estimate for the upcoming quarterly report is $0.07, reflecting a year-over-year increase of 16.7%, with expected revenues of $111.95 million, up 5.9% from the previous year [2] Group 2: Earnings and Stock Performance - The consensus EPS estimate for CI&T has remained unchanged over the last 30 days, indicating that stock price movements may not continue without trends in earnings estimate revisions [3] - CI&T currently holds a Zacks Rank of 2 (Buy), suggesting positive market sentiment [3] - In comparison, Vertex (VERX), another company in the same industry, has a consensus EPS estimate of $0.13, which is a decrease of 13.3% year-over-year, and holds a Zacks Rank of 3 (Hold) [4]

Core Viewpoint - CI&T Inc. (CINT) has shown a downtrend recently, losing 7.4% over the past two weeks, but a hammer chart pattern suggests a potential trend reversal as buying interest may be emerging [1][2]. Technical Analysis - The hammer chart pattern indicates a possible bottoming out, suggesting that selling pressure may be exhausting, which could lead to a trend reversal [2][5]. - The hammer pattern forms when there is a small candle body with a long lower wick, indicating that despite a downtrend, buyers are starting to enter the market [4][5]. - This pattern can occur across various timeframes and is utilized by both short-term and long-term investors [5]. Fundamental Analysis - Recent upward revisions in earnings estimates for CINT serve as a bullish indicator, correlating strongly with near-term stock price movements [7]. - The consensus EPS estimate for the current year has increased by 17.9% over the last 30 days, indicating that analysts are optimistic about the company's earnings potential [8]. - CINT holds a Zacks Rank of 2 (Buy), placing it in the top 20% of over 4,000 ranked stocks, which typically outperform the market [9].

Company Overview - CI&T filed its annual report on Form 20-F for the fiscal year ended December 31, 2024[4]. - CI&T operates globally with over 6,900 professionals across 9 countries[6]. - The company specializes in technology transformation for 100+ large enterprises and fast growth clients[6]. - CI&T has a 30-year track record in helping clients navigate change and deliver business impact[6]. Technology and Services - CI&T's proprietary AI platform, CI&T FLOW, enhances team productivity and ensures efficient delivery of solutions[6]. - The company focuses on areas such as AI, strategy, customer experience, software development, and cloud services[6]. - CI&T's growth strategy includes leveraging deep expertise in data and technology[6]. Financial Information - The annual report is available on the SEC's website and CI&T's investor relations page[4]. - Shareholders can request a hard copy of CI&T's complete audited financial statements free of charge[5]. - The report was signed by Stanley Rodrigues, Chief Financial Officer, on March 28, 2025[9].

Financial Performance - Adjusted Gross Profit for the year ended December 31, 2024, was reported at $X million, reflecting a Y% increase compared to the previous year[28]. - Adjusted EBITDA for the same period was $X million, with an Adjusted EBITDA Margin of Y%[30]. - Revenue at Constant Currency for the fiscal year ended December 31, 2024, showed a growth of Y% compared to the previous year[34]. - Revenue Growth at Constant Currency was 1.3% and 4.2% for the years ended December 31, 2024 and 2023, respectively[128]. - 44.3% of the company's Revenue came from clients in North America for the year ended December 31, 2024, an increase of 0.6 percentage points compared to 2023[133]. Client Relationships and Retention - The company reported a significant increase in client retention rates, contributing to overall revenue growth[46]. - High-quality client support is critical for the renewal and expansion of agreements, especially as the company targets mid-market and large enterprise clients[102]. - The largest client accounted for 7.6% of revenue in 2024, down from 8.3% in 2023, while the top ten clients contributed 41.1% of revenue in 2024, compared to 39.7% in 2023[65]. - The company may experience challenges in maintaining client relationships, as clients can terminate contracts at any time, leading to revenue uncertainty[69]. Market and Economic Conditions - The ongoing geopolitical tensions, including the war in Ukraine, may impact the company's operations and financial performance[46]. - Future operating results are subject to various risks, including competition and economic conditions in Brazil[46]. - Changes in U.S. trade policies, including recent tariff increases, could adversely impact the company's operations and financial results[127]. - Brazilian GDP growth rates were 2.9% in 2022 and 2023, with a projected growth of 3.4% for 2024[193]. - Global macroeconomic instability and geopolitical tensions have contributed to fluctuations in the U.S. dollar against the real, affecting Brazil's economic recovery[195]. Risks and Challenges - The company faces risks from geopolitical tensions, which may disrupt supply chains and affect demand for services[71]. - The company is dependent on a limited number of industry verticals, and any decrease in demand in these sectors could adversely affect revenue[57]. - Future pandemics or health crises could limit clients' operational capabilities, impacting the company's financial results[73]. - The company may face reputational damage and loss of clients if it fails to comply with security obligations or experiences data breaches[57]. - The company faces risks related to the degradation of service quality, which could adversely affect client retention and corporate reputation[77]. Technology and Innovation - The company is focused on enhancing its technological capabilities and adapting to market changes to retain and attract clients[46]. - The company must innovate continuously to remain competitive in the evolving technology landscape, particularly in artificial intelligence[61]. - The company is investing in artificial intelligence capabilities, including the CI&T FLOW AI-powered platform launched in 2023, to meet increasing demand for AI products[142]. Legal and Regulatory Compliance - The company is subject to various legal and regulatory requirements across multiple jurisdictions, which could result in fines and penalties if not complied with[170]. - The Brazilian Civil Rights Framework for the Internet allows for fines up to 10% of the revenues in Brazil of the relevant entity's economic group in the preceding fiscal year[117]. - The company may face increased legal and compliance costs due to evolving regulations related to being a public company[150]. - The company is subject to legal proceedings related to intellectual property rights, which could result in costly litigation and divert management resources[112]. Shareholder Structure and Governance - The company has 22,498,572 Class A common shares and 112,183,684 Class B common shares outstanding[211]. - Each Class A common share entitles its holder to one vote, while each Class B common share entitles its holder to ten votes, maintaining a ten-to-one voting ratio[207]. - The dual class structure of shares concentrates voting control with Class B shareholders, limiting the influence of Class A shareholders on corporate matters[209]. - The company entered into a shareholders' agreement with founder shareholders and Advent Managed Fund LLCs, allowing them to appoint directors to the board[207]. Currency and Foreign Exchange - The company is exposed to fluctuations in foreign currency exchange rates, which may affect financial performance[61]. - The company experienced net foreign exchange gains of US$1,893 in 2024, compared to net foreign exchange losses of US$1,648 in 2023[156]. - As of December 31, 2024, the U.S. dollar commercial selling rate was R$6.1923 per US$1.00, a 27.91% increase from R$4.8413 per US$1.00 on December 31, 2023[157]. - The Brazilian real appreciated by 7.8% against the U.S. dollar in 2022 and 10.4% in 2023, but is projected to depreciate by 21.0% in 2024[181]. Operational Strategies - The company aims to sustain its revenue growth rate and successfully identify and integrate acquisition targets[46]. - The company plans to continue investing in new technologies and market expansion strategies to drive future growth[46]. - The company may require additional capital to support growth and respond to market demands, with current resources expected to last at least 12 months[144]. - The company faces challenges in retaining key employees and integrating personnel from different corporate cultures post-acquisition[138].

Core Viewpoint - CI&T Inc. (CINT) has experienced a significant downtrend, with a 16.9% decline over the past four weeks, but it is now in oversold territory, suggesting a potential turnaround due to improved earnings expectations from analysts [1]. Group 1: Technical Indicators - The Relative Strength Index (RSI) is a key technical indicator used to identify oversold stocks, with a reading below 30 typically indicating oversold conditions [2]. - CINT's current RSI reading is 28.2, suggesting that the heavy selling pressure may be exhausting, indicating a possible price rebound [5]. Group 2: Fundamental Analysis - There is strong consensus among sell-side analysts regarding CINT's earnings potential, with a 17.9% increase in the consensus EPS estimate over the last 30 days, which often correlates with price appreciation [7]. - CINT holds a Zacks Rank 2 (Buy), placing it in the top 20% of over 4,000 ranked stocks based on earnings estimate revisions and EPS surprises, further supporting the potential for a near-term turnaround [8].

Cesar Gon Founder & CEO 4Q24 / FY2024 investors .ciandt.com Hello, We are your CI&T presenters today: Bruno Guicardi Founder & NAE President Stanley Rodrigues Partner, CFO Eduardo Galvão IR Director Submit your question via email to investors@ciandt.com Q&A SESSION investors.ciandt.com SAFE HARBOR AND NON-IFRS MEASURES FORWARD-LOOKING STATEMENTS This presentation includes forward-looking statements within the meaning of the safe harbor provisions of the United States Private Securities Litigation Reform Act ...