Core Insights - CGI has secured a new contract with His Majesty's Revenue and Customs (HMRC) worth up to £250 million over five years, which includes an initial three-year term and two optional one-year extensions [1][5]. Group 1: Contract Details - The contract involves CGI operating and maintaining HMRC's integration services, which are crucial for daily operations and digital transformation [2]. - CGI will deliver new integrations to support HMRC's large-scale digital transformation programs, aligning with HMRC's Transformation Roadmap [3]. - The contract was awarded through Lot 3 of the Crown Commercial Service (CCS) DALAS framework, aimed at modernizing IT application services [5]. Group 2: Strategic Importance - This collaboration aims to strengthen critical systems that support essential public services across the UK, enhancing the digital experience for HMRC's customers and teams [4]. - CGI's role includes managing existing integration capabilities that are part of the UK's Critical National Infrastructure [2]. Group 3: Company Overview - Founded in 1976, CGI is one of the largest independent IT and business consulting services firms globally, with 94,000 professionals and reported revenue of CA$15.91 billion for Fiscal 2025 [6].

Financial Data and Key Metrics Changes - In Q4, the company reported revenue of CAD 4 billion, representing a year-over-year increase of 9.7%, or 5.5% when excluding foreign exchange impacts [6][10] - Adjusted EBIT for the quarter was CAD 667 million, up 11.2% year-over-year, with an industry-leading margin of 16.6% [10] - Adjusted net earnings were CAD 472 million, reflecting an increase of CAD 33 million year-over-year, with a margin of 11.8% [11] - The company generated CAD 663 million in cash from operations, accounting for 16.5% of total revenue [12] Business Line Data and Key Metrics Changes - Managed services revenue grew by 6% in constant currency, aligning with client demand amid challenging macroeconomic conditions [14] - The UK and Australia segment saw growth of 28% due to the acquisition of BJSS [6] - The U.S. segments combined growth was 5.7%, driven by mergers and acquisitions [7] Market Data and Key Metrics Changes - Bookings for the quarter were CAD 4.8 billion, resulting in a book-to-bill ratio of 119%, with U.S. Federal bookings at 185% [8] - The contracted backlog reached CAD 31.5 billion, equivalent to two times revenue [10] Company Strategy and Development Direction - The company focuses on investing in CGI through a share buyback program to enhance EPS while returning cash to shareholders [6] - The strategy includes expanding managed services and IP offerings to improve client efficiency, particularly during economic challenges [5] - The company aims to lead in digital transformation, emphasizing AI-driven business transformation as a core strategy [18][20] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the growth of the federal business post-shutdown, citing strong bookings prior to the shutdown [41] - The company anticipates continued demand for managed services as clients seek to reduce operational costs and reinvest savings into technology initiatives [34] - Despite market uncertainties, management does not foresee a long-term decline in IT budgets, expecting clients to rebalance spending towards managed services and AI [33][58] Other Important Information - The Board of Directors approved a quarterly cash dividend of CAD 0.17 per share, marking a 13% increase [12] - The company closed five acquisitions in fiscal 2025, all expected to be accretive within the first year [16] Q&A Session Summary Question: Impact of federal shutdown on bookings and optimism for federal business - Management noted strong bookings at 185% prior to the shutdown and expects growth to resume once the government reopens [41] Question: Potential margin uplift from AI adoption - Management indicated that AI is enhancing margins through improved managed services and internal process optimizations [42][43] Question: Outcome-based pricing strategy and its protection against pricing pressure - Management clarified that while pricing pressure exists, their outcome-based pricing model allows for better value delivery and profitability [45][48] Question: Revenue per employee growth and its drivers - Management attributed the 5% increase in revenue per employee to AI utilization and geographic expansion, particularly in APAC and Poland [49][50] Question: Book-to-bill ratio and M&A impact - Management explained that M&A does not directly affect the book-to-bill ratio, as backlog from acquisitions is included post-closing [52] Question: AI's impact on implementation processes - Management acknowledged that while AI brings savings, complex client environments still require human oversight [56] Question: Partnership strategy and growth - Management emphasized a broad partnership strategy with various technology firms, adapting to client needs based on region and industry [62] Question: Planned runoff of lower-margin work from acquisitions - Management indicated that while some lower-margin projects may be phased out, the impact will not be material [64] Question: Demand trends in financial services and consulting - Management noted strong demand for AI-related consulting, while traditional business consulting remains flat [71] Question: M&A pipeline and future opportunities - Management expressed optimism about the M&A environment, noting lower valuations and a strong pipeline of potential acquisitions [75][76] Question: AI readiness in M&A targets - Management confirmed that AI expertise is a key consideration in evaluating potential M&A targets [81] Question: Opportunities with the Canadian federal government - Management highlighted potential growth areas in sovereign cloud initiatives and defense-related IT projects [83][85]

Core Viewpoint - CGI Group reported quarterly earnings of $1.55 per share, exceeding the Zacks Consensus Estimate of $1.53 per share, and up from $1.41 per share a year ago, indicating a positive earnings surprise of +1.31% [1][2] Financial Performance - The company posted revenues of $2.91 billion for the quarter ended September 2025, which was below the Zacks Consensus Estimate by 0.42%, but an increase from $2.68 billion year-over-year [3] - Over the last four quarters, CGI has surpassed consensus EPS estimates three times and topped consensus revenue estimates two times [2][3] Stock Performance - CGI shares have declined approximately 21.9% since the beginning of the year, contrasting with the S&P 500's gain of 15.1% [4] - The current Zacks Rank for CGI is 3 (Hold), suggesting that the shares are expected to perform in line with the market in the near future [7] Future Outlook - The consensus EPS estimate for the upcoming quarter is $1.58 on revenues of $3.03 billion, and for the current fiscal year, it is $6.53 on revenues of $12.16 billion [8] - The outlook for the industry, particularly the Computer - Services sector, is currently in the bottom 40% of Zacks industries, which may impact CGI's stock performance [9]

Financial Performance - Q4 F2025 - Revenue reached $4.01 billion, a 9.7% increase compared to Q4 F2024[13] - Constant currency revenue growth was 5.5%[13,36] - Adjusted EBIT increased by 11.2% to $667 million, with a margin of 16.6%, up 20 bps from Q4 F2024[13,41] - Adjusted net earnings increased by 7.4% to $472 million[13] - Adjusted diluted EPS increased by 10.9% to $2.13[13,46] Financial Performance - Fiscal Year 2025 - Revenue reached $15.9 billion, an 8.4% increase compared to F2024[32,56] - Constant currency revenue growth was 4.6%[32,56] - Adjusted EBIT increased by 8.1% to $2.61 billion, with a margin of 16.4%[32,64] - Adjusted net earnings increased by 6.0% to $1.87 billion[32] - Adjusted diluted EPS increased by 8.9% to $8.30[32,68] Other Key Metrics - Book-to-bill ratio for Q4 F2025 was 119.2%, and 110.4% for the last twelve months[15,30] - Cash provided by operating activities for Q4 F2025 was $663 million, representing 16.5% of revenue[28] - Long-term debt and lease liabilities reached $4.33 billion, up $1.02 billion from Q4 F2024[49]

Core Insights - CGI reported a revenue of $4.01 billion for Q4-F2025, reflecting a year-over-year growth of 9.7%, and a constant currency growth of 5.5% [5][7][20] - The company announced a 13% increase in its quarterly cash dividend to $0.17 per share, payable on December 19, 2025 [22] - The book-to-bill ratio reached 119.2% in Q4-F2025, indicating strong demand for CGI's services [5][9] Financial Performance Highlights - For Q4-F2025, earnings before income taxes were $516.2 million, down 12.9% year-over-year, with a margin of 12.9% [6][7] - Adjusted earnings before interest and taxes were $667.4 million, up 11.2% year-over-year, with a margin of 16.6% [7][8] - Net earnings for Q4-F2025 were $381.4 million, down 12.5% year-over-year, resulting in a diluted EPS of $1.72, a decrease of 9.9% [8][9] Annual Performance Overview - For Fiscal 2025, CGI reported total revenue of $15.91 billion, an 8.4% increase year-over-year, with a constant currency growth of 4.6% [13][14] - Earnings before income taxes for Fiscal 2025 were $2,242.2 million, down 2.1% year-over-year, with a margin of 14.1% [13][14] - Adjusted net earnings for Fiscal 2025 were $1,871.5 million, up 6.0% year-over-year, with an adjusted diluted EPS of $8.30, an increase of 8.9% [15][36] Investment and Shareholder Returns - During Q4-F2025, CGI invested $80.5 million back into its business and acquired businesses for $237.5 million net of cash acquired [11] - The company returned $33.3 million to shareholders through dividends in Q4-F2025 [11] - For Fiscal 2025, CGI returned $135.1 million to shareholders through dividend payments [16] Debt and Financial Ratios - As of September 30, 2025, CGI's long-term debt and lease liabilities were $4.33 billion, up from $3.31 billion the previous year [17][36] - The net debt stood at $3.45 billion, an increase from $1.82 billion year-over-year, with a net debt-to-capitalization ratio of 25.1% [17][36]

Consolidated Financial Statements of CGI INC. For the years ended September 30, 2025 and 2024 Management's and Auditor's Reports MANAGEMENT'S STATEMENT OF RESPONSIBILITY FOR FINANCIAL REPORTING The management of CGI Inc. (the Company) is responsible for the preparation and integrity of the consolidated financial statements and the Management's Discussion and Analysis (MD&A). The consolidated financial statements have been prepared in accordance with International Financial Reporting Standards as issued by t ...

Core Insights - CGI has achieved Elite Partner status with Snowflake and ServiceNow, and Diamond Partner status with UiPath, highlighting its strong position in the technology consulting sector [1][2][3] Group 1: Partnership Achievements - CGI's Elite Partner status with Snowflake and ServiceNow reflects its extensive certified expertise and successful delivery of industry-focused outcomes globally [2][3] - As a Diamond Partner with UiPath, CGI has demonstrated outstanding proficiency in delivering end-to-end business automation solutions [3] Group 2: Strategic Focus - CGI's Global Alliances strategy combines deep industry knowledge with leading technologies to help clients embrace emerging technologies like Generative and Agentic AI [2][3] - The company maintains relationships with over 150 technology firms, allowing it to select the best technology solutions tailored to client needs [2][3] Group 3: Company Overview - Founded in 1976, CGI is one of the largest independent IT and business consulting services firms, with 93,000 professionals globally [4] - CGI reported revenue of CA$14.68 billion for Fiscal 2024, indicating strong financial performance [4]

Core Insights - CGI Inc. has been recognized as a Leader in the IDC MarketScape for Worldwide AI Services for State and Local Government 2025 Vendor Assessment, highlighting its strong position in the AI services market for public sector clients [1][2][6]. Group 1: Company Positioning and Strategy - CGI is embedding AI directly into its platforms rather than retrofitting it later, emphasizing responsible AI governance with human oversight and compliance with regulatory standards [1][4]. - The company focuses on enhancing decision-making and improving citizen outcomes through AI, aiming to build greater trust in digital government [2][3]. - CGI's integrated AI approach combines responsible governance, embedded intelligence, and outcome-driven delivery to modernize government operations [3][5]. Group 2: Key Strengths Identified by IDC - CGI has nearly five decades of experience in the public sector, with over 500 ERP implementations and dedicated solutions for fund accounting and human services [5]. - The company’s Responsible AI framework includes human-in-the-loop oversight and transparent governance dashboards, ensuring compliance and security [5]. - CGI maintains a distributed presence across over 80 U.S. locations, providing localized support while leveraging global scale [6]. Group 3: Market Context and Demand - The IDC MarketScape report indicates that state and local governments are seeking AI solutions to improve efficiency, compliance, and citizen services [4][6]. - CGI's solutions are FedRAMP High and GovRAMP-certified, aligning with public sector regulations and addressing security and compliance concerns [4][5]. - The assessment evaluated 18 worldwide AI services providers, focusing on their capabilities in designing, implementing, and operating AI platforms for state and local governments [6].

Core Insights - CGI will release its fourth quarter and fiscal year 2025 results on November 5, 2025, before market opening [1][2] - A conference call will be held at 9:00 a.m. (EDT) to discuss the results and answer questions [2] Company Overview - Founded in 1976, CGI is one of the largest independent IT and business consulting services firms globally [2] - The company has 93,000 consultants and professionals worldwide, offering a comprehensive portfolio of services [2] - CGI reported revenue of CA$14.68 billion for fiscal 2024 [2]

Group 1 - The article emphasizes the importance of investing in high-quality stocks and businesses that are managed by disciplined capital allocators, which can generate exceptional returns on capital and compound invested capital over long periods [1] Group 2 - No specific companies or stocks are mentioned in the article, focusing instead on the general investment philosophy and approach [2][3]