Financial Data and Key Metrics Changes - In Q2 2025, EPAM generated revenue of $1.353 billion, an 18% year-over-year increase, surpassing the upper end of the revenue outlook [31] - Organic constant currency revenue grew 5.3% compared to Q2 2024, marking the third consecutive quarter of positive organic growth [31][32] - GAAP gross margin for the quarter was 28.8%, down from 29.3% in Q2 of the previous year, while non-GAAP gross margin was 30.1%, compared to 30.8% [37] - GAAP income from operations was $126 million, or 9.3% of revenue, compared to $121 million, or 10.5% of revenue in Q2 of last year [38] - Non-GAAP diluted EPS was $2.77, reflecting a $0.32 increase year-over-year [38] Business Line Data and Key Metrics Changes - Financial Services grew 34.4% year-over-year, with 6.5% organic growth in constant currency, driven by strength in banking and insurance [33] - Software and high-tech increased by 21.2% year-over-year, while Life Sciences and Healthcare grew 11.7% [33] - Emerging verticals delivered strong growth of 28.7% year-over-year, positively impacted by recent acquisitions [35] - Consumer Goods, Retail, and Travel showed 6.2% year-over-year growth, indicating improvement [34] Market Data and Key Metrics Changes - The Americas, representing 59% of Q2 revenues, grew 15.9% year-over-year, while EMEA increased by 21.7% [36] - APAC, making up 2% of revenues, saw a 13% year-over-year increase [36] - Revenues from the top 20 clients grew 8.8% year-over-year, while revenues from clients outside the top 20 increased by 23% [36] Company Strategy and Development Direction - The company is focused on AI-native services and core engineering strengths, positioning itself for sustainable growth [6][10] - EPAM is expanding its market-leading position as an AI-native transformation company, with significant investments in AI capabilities [12][13] - The company is optimizing its global delivery hubs to provide scalable options and enhance talent capabilities [15][16] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the stabilization and potential improvement in demand conditions, despite a complex macroeconomic backdrop [7][9] - The company anticipates further improvement in organic constant currency growth rates in Q3 and is raising the bottom end of the revenue growth range for 2025 [42][44] - Management highlighted the importance of quality execution and strategic efficiency for clients, which aligns with EPAM's strengths [10][21] Other Important Information - The CEO transition plan is on track, with the current CEO transitioning to the role of executive chairman [19] - The company has made strategic acquisitions to enhance capabilities in regulated industries and cloud-native engineering [26] Q&A Session Summary Question: Workforce and Talent Addition - Management acknowledged the balance between hiring new talent and optimizing existing resources, indicating a thoughtful approach to bench management [55][57] Question: Client Discretionary Spending - Management noted that clients are returning to discretionary spending due to regulatory requirements and the need for AI adoption, which aligns with EPAM's strengths [59][61] Question: Q4 Activity and Outlook - Management provided insights on the range of Q4 activity, indicating that achieving the midpoint of the guidance requires stable demand and seasonal adjustments [66][68] Question: New Discretionary Transformation Programs - Management highlighted that EPAM is seeing incremental increases in discretionary transformation programs, particularly in AI-driven initiatives [69] Question: Employee Upskilling Progress - Management reported that over 80% of employees have undergone AI upskilling, with ongoing efforts to enhance capabilities across the organization [75][76] Question: Margin and Profitability Outlook - Management indicated a focus on improving utilization and profitability, with expectations to exit the year with better margins compared to previous periods [78][84]

[Executive Summary](index=1&type=section&id=Executive%20Summary) EPAM Systems reported strong Q2 2025 results with sequential organic growth, highlighting AI-led solutions and raising its full-year revenue outlook [Introduction and CEO Commentary](index=1&type=section&id=Introduction%20and%20CEO%20Commentary) EPAM Systems announced strong second-quarter 2025 results, marking its third consecutive quarter of sequential organic growth. CEO Arkadiy Dobkin emphasized the critical role of deep engineering and technology expertise, particularly in AI-led solutions, and the company's distinct client portfolio. The company also raised its full-year revenue outlook - EPAM achieved its third consecutive quarter of sequential organic growth, indicating a return to greater consistency in performance[3](index=3&type=chunk) - CEO Arkadiy Dobkin highlighted the critical importance of deep engineering and technology expertise, especially for AI-led solutions and complex modernization efforts required for AI adoption[3](index=3&type=chunk) - Clients are increasingly engaging EPAM to build out their data and AI foundations as they prioritize AI-readiness and preparatory actions[3](index=3&type=chunk) [Second Quarter 2025 Financial Highlights](index=1&type=section&id=Second%20Quarter%202025%20Financial%20Highlights) EPAM reported Q2 2025 revenues of $1.353 billion with 18.0% year-over-year growth, alongside GAAP and non-GAAP operating income and EPS figures [Revenue and Profitability Overview](index=1&type=section&id=Revenue%20and%20Profitability%20Overview) EPAM reported Q2 2025 revenues of $1.353 billion, an 18.0% year-over-year increase. On an organic constant currency basis, revenues grew by 5.3%. GAAP income from operations was $126.5 million (9.3% of revenues), and non-GAAP income from operations was $202.9 million (15.0% of revenues) Q2 2025 Revenue and Operating Income Performance | Metric | Q2 2025 | Q2 2024 | YoY Change | YoY % Change | | :-------------------------------- | :---------- | :---------- | :---------- | :----------- | | Revenues ($) | $1.353 billion | $1.147 billion | $206.8 million | +18.0% | | Organic Constant Currency Revenue Growth (%) | +5.3% | N/A | N/A | N/A | | GAAP Income from Operations ($) | $126.5 million | $120.6 million | $5.9 million | +4.9% | | GAAP Operating Margin (%) | 9.3% | 10.5% | N/A | -1.2 pp | | Non-GAAP Income from Operations ($) | $202.9 million | $174.5 million | $28.4 million | +16.3% | | Non-GAAP Operating Margin (%) | 15.0% | 15.2% | N/A | -0.2 pp | [Earnings Per Share Performance](index=1&type=section&id=Earnings%20Per%20Share%20Performance) In Q2 2025, GAAP diluted EPS decreased by $0.14 or 8.2% year-over-year to $1.56. Conversely, non-GAAP diluted EPS increased by $0.32 or 13.1% year-over-year to $2.77 Q2 2025 Diluted EPS Performance | Metric | Q2 2025 | Q2 2024 | YoY Change | YoY % Change | | :------------------ | :------ | :------ | :--------- | :----------- | | GAAP Diluted EPS ($) | $1.56 | $1.70 | -$0.14 | -8.2% | | Non-GAAP Diluted EPS ($) | $2.77 | $2.45 | +$0.32 | +13.1% | [Operational and Cash Flow Metrics](index=2&type=section&id=Operational%20and%20Cash%20Flow%20Metrics) EPAM's cash provided by operating activities decreased significantly, while total cash and equivalents also declined, alongside share repurchases and a slight headcount increase [Cash Flow and Balance Sheet Position](index=2&type=section&id=Cash%20Flow%20and%20Balance%20Sheet%20Position) For the first six months of 2025, cash provided by operating activities was $77.4 million, a significant decrease from $186.9 million in the prior year. Cash, cash equivalents, and restricted cash totaled $1.046 billion as of June 30, 2025, an 18.9% decrease from December 31, 2024 Cash Flow and Cash Position (First Six Months) | Metric | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | Change | | :-------------------------------- | :----------------------------- | :----------------------------- | :------------- | | Cash provided by operating activities ($) | $77.4 million | $186.9 million | -$109.5 million | | Cash, cash equivalents & restricted cash (as of June 30, 2025) ($) | $1.046 billion | $1.290 billion (Dec 31, 2024) | -$243.9 million (-18.9%) | [Headcount and Share Repurchase Activity](index=2&type=section&id=Headcount%20and%20Share%20Repurchase%20Activity) EPAM repurchased 1.087 million shares of common stock for $194.9 million during Q2 2025, with $82.1 million remaining under its authorization. Total headcount reached approximately 62,050, including 55,800 delivery professionals, showing a slight increase of 0.3% from the previous quarter - The Company repurchased **1.087 million shares** of its common stock for **$194.9 million** during the second quarter of 2025 under its share repurchase program[8](index=8&type=chunk) - As of June 30, 2025, the Company had **$82.1 million** remaining under its share repurchase authorization[8](index=8&type=chunk) Headcount as of June 30, 2025 | Metric | Value | | :-------------------- | :------ | | Total Headcount (approximate) | ~62,050 | | Delivery Professionals (approximate) | ~55,800 | | QoQ Change (Delivery Professionals) (%) | +0.3% | [2025 Financial Outlook](index=2&type=section&id=2025%20Financial%20Outlook) EPAM raised its full-year 2025 revenue growth guidance and provided detailed financial projections for both the full year and the third quarter of 2025 [Full Year 2025 Guidance](index=2&type=section&id=Full%20Year%202025%20Guidance) EPAM raised its full-year 2025 expected year-over-year revenue growth rate to 13.0% to 15.0%, with organic constant currency growth projected at 3.0% to 5.0%. The company updated its GAAP effective tax rate to approximately 26.0% and revised GAAP diluted EPS to $6.48 to $6.64, and non-GAAP diluted EPS to $10.96 to $11.12 Full Year 2025 Outlook | Metric | Range | | :-------------------------------- | :-------------------- | | YoY Revenue Growth Rate (%) | 13.0% to 15.0% | | Organic Constant Currency Revenue Growth Rate (%) | 3.0% to 5.0% | | GAAP Income from Operations (% of revenues) | 9.0% to 10.0% | | Non-GAAP Income from Operations (% of revenues) | 14.5% to 15.5% | | GAAP Effective Tax Rate (approximate %) | ~26.0% | | Non-GAAP Effective Tax Rate (approximate %) | ~24.0% | | GAAP Diluted EPS ($) | $6.48 to $6.64 | | Non-GAAP Diluted EPS ($) | $10.96 to $11.12 | | Weighted Average Diluted Shares Outstanding (millions) | 56.4 million | [Third Quarter 2025 Guidance](index=2&type=section&id=Third%20Quarter%202025%20Guidance) For Q3 2025, EPAM expects revenues between $1.365 billion and $1.380 billion, representing 17.6% year-over-year growth at the midpoint. Organic constant currency revenue growth is projected at 6.2% at the midpoint. Non-GAAP diluted EPS is expected to be in the range of $2.98 to $3.06 Third Quarter 2025 Outlook | Metric | Range | | :-------------------------------- | :-------------------- | | Revenues ($) | $1.365 billion to $1.380 billion | | YoY Revenue Growth Rate (midpoint %) | 17.6% | | Organic Constant Currency Revenue Growth Rate (midpoint %) | 6.2% | | GAAP Income from Operations (% of revenues) | 10.0% to 11.0% | | Non-GAAP Income from Operations (% of revenues) | 15.5% to 16.5% | | GAAP Effective Tax Rate (approximate %) | ~25.0% | | Non-GAAP Effective Tax Rate (approximate %) | ~24.0% | | GAAP Diluted EPS ($) | $1.89 to $1.97 | | Non-GAAP Diluted EPS ($) | $2.98 to $3.06 | | Weighted Average Diluted Shares Outstanding (millions) | 55.9 million | [Company Information](index=3&type=section&id=Company%20Information) This section provides details on EPAM's upcoming conference call and an overview of the company's global digital engineering and AI-enabled transformation services [Conference Call Details](index=3&type=section&id=Conference%20Call%20Details) EPAM will host a conference call on Thursday, August 7, 2025, at 8:00 a.m. EDT to discuss the results. The live webcast will be available on the EPAM investor relations website, with a replay also accessible - EPAM will host a conference call on Thursday, August 7, 2025, at 8:00 a.m. EDT to discuss the results[9](index=9&type=chunk) - The conference call will be available live on the EPAM website at https://investors.epam.com, with a replay available in the Investor Relations section[9](index=9&type=chunk) [About EPAM Systems](index=3&type=section&id=About%20EPAM%20Systems) EPAM Systems, founded in 1993, is a leading global provider of digital engineering, cloud, and AI-enabled transformation services. The company focuses on integrated strategy, experience, and technology consulting, leveraging AI and GenAI platforms like EPAM AI/RUN™ to drive client innovation. EPAM is recognized in the S&P 500, Forbes Global 2000, and Fortune 1000 for its IT services - EPAM Systems, Inc. (NYSE: EPAM) is a leading global provider of digital engineering, cloud and AI-enabled transformation services, and a leading business and experience consulting partner for global enterprises and ambitious startups since 1993[10](index=10&type=chunk) - The company leverages AI and GenAI to deliver transformative solutions, accelerating clients' digital innovation and enhancing their competitive edge through platforms like EPAM AI/RUN™ and initiatives like DIALX Lab[11](index=11&type=chunk) - EPAM was added to the S&P 500 and the Forbes Global 2000 in 2021 and is among the top 15 companies in Information Technology Services in the Fortune 1000[13](index=13&type=chunk) [Condensed Consolidated Financial Statements](index=5&type=section&id=Condensed%20Consolidated%20Financial%20Statements) This section presents EPAM's unaudited condensed consolidated statements of income and balance sheets for specified periods, detailing financial performance and position [Condensed Consolidated Statements of Income](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Income) The unaudited condensed consolidated statements of income present EPAM's financial performance for the three and six months ended June 30, 2025, compared to the same periods in 2024, detailing revenues, operating expenses, income from operations, and net income Condensed Consolidated Statements of Income (Three Months Ended June 30) | Metric (in thousands of $) | June 30, 2025 | June 30, 2024 | | :-------------------------------- | :-------------- | :-------------- | | Revenues ($) | $1,353,443 | $1,146,597 | | Income from operations ($) | $126,476 | $120,561 | | Net income ($) | $88,026 | $98,645 | | Diluted EPS ($) | $1.56 | $1.70 | Condensed Consolidated Statements of Income (Six Months Ended June 30) | Metric (in thousands of $) | June 30, 2025 | June 30, 2024 | | :-------------------------------- | :-------------- | :-------------- | | Revenues ($) | $2,655,135 | $2,312,062 | | Income from operations ($) | $225,806 | $231,093 | | Net income ($) | $161,508 | $214,888 | | Diluted EPS ($) | $2.84 | $3.67 | [Condensed Consolidated Balance Sheets](index=6&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) The unaudited condensed consolidated balance sheets provide a snapshot of EPAM's financial position as of June 30, 2025, compared to December 31, 2024, detailing assets, liabilities, and equity Condensed Consolidated Balance Sheets (as of) | Metric (in thousands of $) | June 30, 2025 | December 31, 2024 | | :-------------------------------- | :-------------- | :---------------- | | Total current assets ($) | $2,370,475 | $2,426,248 | | Total assets ($) | $4,710,696 | $4,750,473 | | Total current liabilities ($) | $747,427 | $821,039 | | Total liabilities ($) | $1,042,334 | $1,119,322 | | Total equity ($) | $3,668,362 | $3,631,151 | [Non-GAAP Financial Measures and Reconciliations](index=4&type=section&id=Non-GAAP%20Financial%20Measures%20and%20Reconciliations) This section explains EPAM's non-GAAP financial measures and provides detailed reconciliations for historical performance and future guidance, enhancing comparability of operating results [Explanation of Non-GAAP Measures](index=4&type=section&id=Explanation%20of%20Non-GAAP%20Measures) EPAM uses non-GAAP financial measures to provide a clearer view of underlying business trends, supplementing GAAP results. These measures exclude specific items like stock-based compensation, acquisition-related costs, humanitarian support expenses, and certain one-time charges, aiming to offer better comparability of operating performance - Management believes non-GAAP measures help illustrate underlying trends in EPAM's business and are used for budgeting, operational goals, and performance evaluation[15](index=15&type=chunk) - Non-GAAP results exclude items such as stock-based compensation, acquisition-related costs, impairment of assets, humanitarian commitment expenses for Ukraine, geographic repositioning costs, employee separation costs, and certain other one-time charges and benefits[15](index=15&type=chunk) - Revenues on an 'organic constant currency basis' exclude the effect of acquisitions (for 12 months post-acquisition) and foreign currency exchange rate fluctuations[15](index=15&type=chunk) [Historical Non-GAAP Reconciliations](index=7&type=section&id=Historical%20Non-GAAP%20Reconciliations) This section provides detailed reconciliations of GAAP to non-GAAP financial measures for the three and six months ended June 30, 2025, and 2024, covering cost of revenues, selling, general and administrative expenses, income from operations, and net income, along with specific adjustment details Q2 2025 Non-GAAP Income Statement Reconciliation Highlights | Metric | GAAP (Q2 2025) | Adjustments (Q2 2025) | Non-GAAP (Q2 2025) | | :-------------------------------- | :--------------- | :-------------------- | :----------------- | | Cost of revenues (exclusive of depreciation and amortization) ($) | $964,012 | $(18,232) | $945,780 | | Selling, general and administrative expenses ($) | $231,681 | $(40,349) | $191,332 | | Income from operations ($) | $126,476 | $76,417 | $202,893 | | Operating margin (%) | 9.3% | 5.7% | 15.0% | | Net income ($) | $88,026 | $68,765 | $156,791 | | Diluted earnings per share ($) | $1.56 | N/A | $2.77 | - Adjustments to GAAP cost of revenues and selling, general and administrative expenses primarily include stock-based compensation, humanitarian support in Ukraine, and cost optimization charges[23](index=23&type=chunk)[24](index=24&type=chunk)[25](index=25&type=chunk) - Total adjustments to GAAP income from operations for Q2 2025 were **$76.4 million**, and for the six months ended June 30, 2025, were **$152.8 million**[23](index=23&type=chunk) [Guidance Non-GAAP Reconciliations](index=9&type=section&id=Guidance%20Non-GAAP%20Reconciliations) This section provides reconciliations for EPAM's forward-looking guidance, converting GAAP projections to non-GAAP for Q3 and Full Year 2025. It details adjustments for revenue growth, income from operations, effective tax rates, and diluted EPS, offering a comprehensive view of expected non-GAAP performance [Revenue Growth Reconciliation](index=9&type=section&id=Revenue%20Growth%20Reconciliation) This section reconciles EPAM's expected revenue growth from reported GAAP figures to an organic constant currency basis for Q3 and Full Year 2025 Expected Revenue Growth Reconciliation (Q3 & Full Year 2025) | Metric | Third Quarter 2025 (at midpoint) | Full Year 2025 | | :-------------------------------- | :------------------------------- | :-------------------- | | Revenue growth as reported (%) | 17.6% | 13.0% to 15.0% | | Foreign exchange rates impact (%) | (1.0)% | (0.9)% | | Inorganic revenue growth (%) | (10.4)% | (9.1)% | | Revenue growth on an organic constant currency basis (%) | 6.2% | 3.0% to 5.0% | [Income from Operations Reconciliation](index=9&type=section&id=Income%20from%20Operations%20Reconciliation) This section reconciles GAAP income from operations to non-GAAP for Q3 and Full Year 2025, detailing adjustments for various expenses Expected Income from Operations Reconciliation (Q3 & Full Year 2025) | Metric | Third Quarter 2025 | Full Year 2025 | | :-------------------------------- | :-------------------- | :-------------------- | | GAAP income from operations as a percentage of revenues (%) | 10.0% to 11.0% | 9.0% to 10.0% | | Stock-based compensation expenses (%) | 3.2% | 3.2% | | Humanitarian support in Ukraine (%) | 0.3% | 0.3% | | Cost Optimization charges (%) | 0.7% | 0.7% | | Amortization of acquired intangible assets (%) | 1.3% | 1.3% | | Non-GAAP income from operations as a percentage of revenues (%) | 15.5% to 16.5% | 14.5% to 15.5% | [Effective Tax Rate Reconciliation](index=9&type=section&id=Effective%20Tax%20Rate%20Reconciliation) This section reconciles EPAM's GAAP effective tax rate to its non-GAAP effective tax rate for Q3 and Full Year 2025 Expected Effective Tax Rate Reconciliation (Q3 & Full Year 2025) | Metric | Third Quarter 2025 | Full Year 2025 | | :-------------------------------- | :-------------------- | :-------------------- | | GAAP effective tax rate (approximately %) | 25.0% | 26.0% | | Non-GAAP effective tax rate (approximately %) | 24.0% | 24.0% | [Diluted EPS Reconciliation](index=10&type=section&id=Diluted%20EPS%20Reconciliation) This section reconciles GAAP diluted EPS to non-GAAP diluted EPS for Q3 and Full Year 2025, detailing per-share adjustments Expected Diluted EPS Reconciliation (Q3 & Full Year 2025) | Metric | Third Quarter 2025 | Full Year 2025 | | :-------------------------------- | :-------------------- | :-------------------- | | GAAP diluted earnings per share ($) | $1.89 to $1.97 | $6.48 to $6.64 | | Stock-based compensation expenses ($) | 0.79 | 3.13 | | Humanitarian support in Ukraine ($) | 0.07 | 0.28 | | Cost Optimization charges ($) | 0.16 | 0.68 | | Amortization of acquired intangible assets ($) | 0.33 | 1.27 | | Non-GAAP diluted earnings per share ($) | $2.98 to $3.06 | $10.96 to $11.12 | [Legal and Investor Information](index=4&type=section&id=Legal%20and%20Investor%20Information) This section includes disclaimers regarding forward-looking statements and provides contact information for investor relations [Forward-Looking Statements](index=4&type=section&id=Forward-Looking%20Statements) This section contains a standard disclaimer regarding forward-looking statements, emphasizing that estimates are subject to risks, uncertainties, and assumptions. Factors such as geopolitical events (e.g., war in Ukraine), global economic conditions, and the adoption of AI technologies could cause actual results to differ materially - The press release includes forward-looking statements subject to risks, uncertainties, and assumptions as to future events that may not prove to be accurate[16](index=16&type=chunk) - Factors that could cause actual results to differ materially include developments relating to the war in Ukraine, difficult conditions in global capital markets, and the adoption and implementation of artificial intelligence technologies[16](index=16&type=chunk) [Investor Contact](index=4&type=section&id=Investor%20Contact) Contact information for EPAM Systems' Head of Investor Relations, Mike Rowshandel, is provided for investor inquiries - For investor inquiries, contact Mike Rowshandel, Head of Investor Relations at EPAM Systems, Inc[17](index=17&type=chunk) - Contact details: Phone: +1-267-759-9000 x393336, Email: mike_rowshandel@epam.com[17](index=17&type=chunk)

Core Viewpoint - The upcoming earnings report for Epam (EPAM) is anticipated to show a quarterly earnings increase of 6.5% year-over-year, with revenues expected to rise by 16.3% [1] Revenue Estimates - The consensus estimate for 'Revenues by Industry Verticals- Financial Services' is $312.51 million, reflecting a year-over-year increase of 27.9% [4] - 'Revenues by Industry Verticals- Software & Hi-Tech' is projected to reach $189.86 million, indicating a 12.5% increase from the previous year [4] - 'Revenues by Industry Verticals- Life Sciences & Healthcare' is expected to be $162.54 million, showing a 16% year-over-year change [5] - 'Revenues by Industry Verticals- Emerging Verticals' is estimated at $215.24 million, representing a 22.8% increase from the prior year [5] - 'Revenues by Industry Verticals- Consumer Goods, Retail & Travel' is forecasted to be $269.77 million, indicating a 6.9% year-over-year change [6] - 'Revenues by Contract Type- Time-and-material' is expected to reach $1.12 billion, reflecting an 18.3% increase from the previous year [6] - 'Revenues by Contract Type- Fixed-price' is projected at $205.76 million, indicating a 5.2% increase year-over-year [7] - 'Revenues by Contract Type- Licensing and other revenues' is expected to be $10.78 million, showing a significant increase of 47.2% from the prior year [7] - 'Revenues by Industry Verticals- Business Information & Media' is estimated at $182.45 million, reflecting a 10.1% increase year-over-year [8] - 'Revenues by Customer Location- Americas' is projected to be $799.89 million, indicating a 15.7% year-over-year change [8] - 'Revenues by Customer Location- APAC' is expected to reach $27.19 million, reflecting a 12.9% increase from the previous year [9] - 'Revenues by Customer Location- EMEA' is estimated at $498.60 million, indicating a 15.6% year-over-year change [9] Stock Performance - Epam shares have decreased by 17.4% over the past month, contrasting with the Zacks S&P 500 composite's increase of 0.6% [9]

Core Insights - EPAM Systems, Inc. has launched its DIAL open-source GenAI enterprise platform in the new AI Agents and Tools category of AWS Marketplace, enabling customers to discover, buy, and deploy AI solutions more efficiently [1][3] Company Overview - EPAM Systems, Inc. is a leading provider of digital transformation services and product engineering, recognized for its expertise in software engineering and AI-enabled transformation services [5][8] - The company has been operational since 1993 and has established itself as a global leader in digital engineering and consulting, serving clients across various industries [5][8] Product Features - DIAL is an agentic AI orchestration platform that integrates large language models from AWS Bedrock, addressing challenges in deploying AI at scale across business functions [2][3] - The platform supports both structured and unstructured data, enhancing collaboration and operational efficiency within enterprises [2] - DIAL 3.0 embodies a modular, open-source approach to enterprise AI adoption, balancing innovation with governance and interoperability [2] Customer Benefits - By offering DIAL in AWS Marketplace, EPAM aims to streamline the procurement process for customers, reducing the time needed for vendor evaluations and negotiations [4] - The platform empowers business users with QuickApps for rapid AI-driven solution creation and provides developers with CodeApps for customized application development [3] - Customers in various sectors, including healthcare, financial services, and retail, are leveraging DIAL to enhance operational productivity and accelerate AI adoption [3]

Core Viewpoint - Epam (EPAM) is positioned well to potentially beat earnings estimates in its upcoming quarterly report, supported by a solid history of exceeding expectations [1][6]. Group 1: Earnings Performance - Epam has a strong track record of surpassing earnings estimates, particularly in the last two quarters, with an average surprise of 4.72% [2]. - In the most recent quarter, Epam reported earnings of $2.27 per share against an expectation of $2.41, resulting in a surprise of 6.17%. In the previous quarter, the company reported $2.84 per share compared to an estimate of $2.75, yielding a surprise of 3.27% [3]. Group 2: Earnings Estimates and Predictions - Estimates for Epam have been trending upward, aided by its history of earnings surprises. The stock currently has a positive Zacks Earnings ESP of +0.14%, indicating a bullish sentiment among analysts regarding its earnings prospects [6][9]. - The combination of a positive Earnings ESP and a Zacks Rank of 3 (Hold) suggests a high likelihood of another earnings beat, with historical data showing that such combinations lead to positive surprises nearly 70% of the time [7][9]. Group 3: Earnings ESP Metric - The Zacks Earnings ESP compares the Most Accurate Estimate to the Zacks Consensus Estimate, with the Most Accurate Estimate reflecting the latest analyst revisions, which may be more accurate [8]. - A negative Earnings ESP can diminish predictive power but does not necessarily indicate an earnings miss [10].

Company Overview - EPAM Systems, Inc. is a leading global provider of digital engineering, cloud, and AI-enabled transformation services, established in 1993 [3] - The company focuses on addressing clients' transformation challenges through an integrated strategy that combines experience and technology consulting with over 30 years of engineering execution [3] Financial Results Announcement - EPAM Systems will host a conference call on August 7, 2025, at 8:00 a.m. ET to discuss its second quarter 2025 financial results, with a news release to be issued prior to the call [1] Digital Innovation and AI Integration - The company leverages AI and GenAI to deliver transformative solutions that enhance clients' digital innovation and competitive edge [4] - EPAM integrates advanced AI technologies into tailored business strategies through platforms like EPAM AI/RUN™ and initiatives such as DIALX Lab [4] Global Presence and Recognition - EPAM serves customers across six continents and has been recognized as one of the top 15 companies in Information Technology Services in the Fortune 1000 [6] - The company was added to the S&P 500 and Forbes Global 2000 in 2021 and has received accolades from Glassdoor and Newsweek as a Most Loved Workplace [6]

Group 1: Core Insights - Investors in the Computers - IT Services sector should consider Cognizant (CTSH) and Epam (EPAM) for potential value opportunities [1] - The Zacks Rank system identifies stocks with positive earnings estimate revisions, which is crucial for value investors [2][3] Group 2: Valuation Metrics - Cognizant has a Zacks Rank of 2 (Buy), indicating an improving earnings outlook, while Epam has a Zacks Rank of 3 (Hold) [3][7] - CTSH has a forward P/E ratio of 15.28, compared to EPAM's forward P/E of 15.96, suggesting CTSH may be more attractively priced [5] - The PEG ratio for CTSH is 1.77, while EPAM's PEG ratio is 1.79, indicating similar growth expectations [5] - CTSH's P/B ratio is 2.57, while EPAM's P/B ratio is 2.73, further supporting the valuation advantage of CTSH [6] Group 3: Value Grades - Based on the valuation metrics, CTSH has earned a Value grade of B, while EPAM has a Value grade of C, indicating a stronger value proposition for CTSH [6]

Core Insights - EPAM Systems, Inc. has launched DIAL 3.0, an open-source GenAI platform aimed at facilitating enterprise AI adoption through a modular and open-source approach [1][3] - DIAL 3.0 is designed to help clients accelerate value delivery while avoiding vendor lock-in, bridging commercial models with open innovation [3][4] - The platform has evolved from an internal tool to a comprehensive framework utilized by global clients across various industries, including financial services, healthcare, and retail [4][5] Company Strategy - EPAM emphasizes a hybrid strategy that combines structured platform thinking with the flexibility of open source, allowing organizations to move faster in AI deployment [4] - The platform supports agentic workflows and data-native reasoning, addressing structural challenges of deploying AI at scale across business functions [4] - DIAL 3.0 introduces new methodologies for working with both structured and unstructured data, promoting collaboration across enterprises [4][5] Client Engagement - Altera Digital Health, an early adopter of DIAL, highlights the platform's ability to improve operational efficiency and the importance of EPAM's commitment to open-source innovation [5][6] - The continued evolution of DIAL has fostered trust among clients as they scale their AI solutions [6] Industry Position - EPAM Systems has established itself as a leading global provider of digital engineering and AI-enabled transformation services, addressing clients' transformation challenges through integrated strategy and technology consulting [10] - The company is recognized for its significant impact in the industry, being included in the S&P 500 and Forbes Global 2000, and is noted for its leadership in various IT service categories [10]

Core Insights - Cognizant (CTSH) and Epam (EPAM) are two stocks in the Computers - IT Services sector, with a comparison being made to determine which offers better value for investors [1] Valuation Metrics - CTSH has a forward P/E ratio of 15.96, while EPAM has a forward P/E of 16.84 [5] - CTSH's PEG ratio is 1.85, compared to EPAM's PEG ratio of 1.89, indicating similar expected earnings growth rates [5] - CTSH's P/B ratio is 2.68, while EPAM's P/B ratio is 2.83, suggesting that CTSH is relatively more undervalued [6] Zacks Rank and Style Scores - CTSH has a Zacks Rank of 2 (Buy), indicating a positive earnings outlook, while EPAM has a Zacks Rank of 3 (Hold) [3] - CTSH has a Value grade of B, whereas EPAM has a Value grade of C, suggesting that CTSH is viewed more favorably by value investors [6]

Core Insights - EPAM Systems has not fully recovered from its exposure to Russia and Ukraine since 2022, indicating ongoing challenges in the geopolitical landscape [1] - The company is actively rebuilding its workforce, relocating staff from affected regions, and acquiring new capabilities, which suggests a strategic pivot towards recovery and growth [1] Workforce and Growth Strategy - EPAM Systems is showing signs of returning growth, which may be attributed to its efforts in workforce rebuilding and capability enhancement [1] - The relocation of staff from Russia and Ukraine highlights the company's commitment to mitigating risks associated with geopolitical tensions [1]