IBEX leadership described an evolution in the industry from what it called “BPO 1.0”—a labor arbitrage model where “bigger was better” and cost was the primary focus—to “BPO 2.0,” where customer experience and brand alignment increasingly drive outsourcing decisions. The company said it has built a differentiated offering designed to compete on quality and outcomes rather than simply cost.Executives framed the broader contact center market as roughly $350 billion, including both in-house and outsourced oper ...

Summary of IBEX Conference Call - March 18, 2026 Company Overview - **Company**: IBEX (NasdaqGM:IBEX) - **Industry**: Contact Center/BPO (Business Process Outsourcing) - **Employee Count**: Approximately 38,000 employees globally [3] Financial Performance - **EBITDA Growth**: 16% Adjusted EBITDA growth year-over-year, with a total increase of 44% [3] - **Free Cash Flow**: Strong Free Cash Flow reported, indicating financial health [3] - **Revenue Growth**: - Four-year compound annual growth rate (CAGR) of 6% in organic revenue [18] - 17% revenue growth in Q2, with 32% net income growth and 45% EPS growth [21] - **Adjusted EPS Growth**: 19% growth driven by strong operating performance [20] - **Share Repurchase**: Approximately 30% of shares repurchased over the past 2-3 years [20] Industry Insights - **Market Size**: The contact center market is valued at approximately $350 billion, with $100 billion in the outsourced segment [4][5] - **Fragmentation**: The industry is highly fragmented, with the top 10 players holding only 35% market share [5] - **Growth Drivers**: Increasing outsourcing trends expected over the next decade due to cost challenges faced by clients [6] Competitive Positioning - **BPO 2.0**: IBEX positions itself as a leader in the evolving BPO landscape, focusing on customer experience rather than just cost [10][11] - **Employee Engagement**: Employee Net Promoter Score of 77, significantly higher than competitors, indicating strong employee loyalty [11] - **Client Retention**: 98.5% revenue retention rate among clients, showcasing high stickiness [12][30] Growth Strategy - **Land and Expand Model**: New clients typically see revenue growth of 2.5 times in year two and an additional 50% in year three [35] - **Vertical Market Focus**: High-margin verticals such as HealthTech (35% growth), travel transportation (20% growth), and retail (17% growth) are key growth areas [22] - **AI Integration**: Plans to leverage AI to enhance operations and improve margins, with current margins around 30% expected to double with AI solutions [43] Challenges and Opportunities - **Market Dynamics**: Clients are increasingly looking to outsource due to cost pressures and the need for improved customer experiences [39] - **AI Adoption**: While currently minimal, AI is seen as a significant future growth driver, with potential for high-margin offerings [42][44] Conclusion - **Investment Thesis**: IBEX presents a compelling investment opportunity with strong financial metrics, a unique market position, and a clear strategy for growth through innovation and customer-centric solutions [16][18]

Core Insights - IBEX Limited, a leading provider of business process outsourcing and AI-powered customer engagement technology solutions, will present at the Sidoti Small-Cap Virtual Conference on March 18, 2026 [1] - The management team will also engage in one-on-one investor meetings throughout the day of the conference [2] Company Overview - IBEX is recognized as a global leader in outsourced business services and AI-driven customer experience solutions, supporting top brands in delivering exceptional customer experiences [3] - The company employs over 36,000 customer experience experts and utilizes advanced AI technology, extensive customer experience innovation, and deep business insights to create seamless customer journeys across various sectors including retail, e-commerce, healthcare, fintech, utilities, technology, and logistics [3]

Group 1 - The article does not provide any relevant content regarding company or industry insights [1]

Financial Data and Key Metrics Changes - The company reported headline revenue growth of 17% and adjusted EPS growth of 46% in Q2 FY 2026, with revenue reaching $164.2 million, up 16.7% from $140.7 million in the prior year quarter [4][13] - Net income increased to $12.2 million from $9.3 million in the prior year quarter, driven by growth in higher margin offshore regions and reduced SG&A expenses as a percentage of revenue [16][17] - Fully diluted EPS rose to $0.83, a 45% increase from $0.57 in the prior year quarter, supported by strong operating performance and fewer diluted shares outstanding [17][19] Business Line Data and Key Metrics Changes - Revenue growth was primarily driven by the health tech vertical, which grew by 35.1%, travel, transportation, and logistics by 20.2%, and retail and e-commerce by 17.2% [14] - The telecommunications vertical saw a decline of 23.1%, marking it as one of the smallest verticals [15] - Health tech now accounts for 17.4% of total revenue, up from 15.1% in the prior year quarter, while telecommunications decreased to 8.7% from 13.1% [20][21] Market Data and Key Metrics Changes - Offshore revenues grew by 16.2% compared to the prior year quarter, comprising 52.3% of total revenue, while onshore revenues expanded to 24% of total revenue from 22% [15][16] - The company continues to win and grow in all geographic markets, with a focus on higher-margin offshore delivery locations positively impacting bottom-line results [15] Company Strategy and Development Direction - The company is focused on expanding its AI capabilities and strategic investments in high-margin verticals, positioning itself as a leader in AI-powered customer experience [9][10] - The recent promotion of Mike Darwal to Chief AI and Digital Officer reflects the company's commitment to enhancing its AI leadership [10][12] - The company aims to maintain a structurally sound business model with a focus on market-leading growth, expanding margins, and strong cash flow generation [11] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to maintain momentum in the second half of FY 2026, with expectations to raise revenue and adjusted EBITDA guidance [25][26] - The company anticipates a more consistent revenue flow throughout the fiscal year, moving away from historical seasonal spikes [33] Other Important Information - The company achieved a record adjusted EBITDA of $20.7 million, or 12.6% of revenue, reflecting growth in higher-margin offshore locations and services [18][25] - Capital expenditures increased to $11.7 million, or 7.1% of revenue, driven by expansion in offshore regions [22][23] Q&A Session Summary Question: Demand and impact of AI on the industry - Management highlighted that the company has established itself as an AI leader, which aids in winning new clients and enhances operational execution, contributing to market share growth [28][30] Question: Changes in revenue patterns due to business mix - Management noted that the mix shift towards higher-margin verticals may lead to a more consistent revenue flow throughout the year, reducing the historical seasonal decline [32][34] Question: Gross margins and operating expenses - Management acknowledged that while gross margins have decreased year-over-year, SG&A expenses are growing at a slower rate than revenue, indicating operational efficiency [35][36]

Financial Data and Key Metrics Changes - The company reported headline revenue growth of 17% and adjusted EPS growth of 46% in Q2 FY 2026, with revenue reaching $164.2 million, a 16.7% increase from $140.7 million in the prior year quarter [4][13] - Net income increased to $12.2 million from $9.3 million in the prior year quarter, driven by growth in higher-margin offshore regions and reduced SG&A expenses as a percentage of revenue [16][17] - Adjusted EBITDA reached a record of $20.7 million, or 12.6% of revenue, up from $16.5 million, or 11.8% of revenue in the same period last year [19] Business Line Data and Key Metrics Changes - Revenue growth was primarily driven by the health tech vertical, which grew by 35.1%, travel, transportation, and logistics by 20.2%, and retail and e-commerce by 17.2% [14] - The telecommunications vertical saw a decline of 23.1%, marking it as one of the smallest verticals [14] - Health tech now accounts for 17.4% of total revenue, up from 15.1% in the prior year quarter, while telecommunications decreased to 8.7% of revenue from 13.1% [20][21] Market Data and Key Metrics Changes - Offshore revenues grew by 16.2% compared to the prior year quarter, while nearshore locations grew by 8.5%, and onshore regions expanded by 27.5% [15] - The company’s highest margin offshore revenues comprised 52.3% of total revenue, reflecting a strategic focus on higher-margin delivery locations [15] Company Strategy and Development Direction - The company is focused on expanding its AI capabilities and strategic market presence, positioning itself as a leader in AI-powered customer experience [9][10] - The expansion into India is highlighted as a key growth vector, with plans to continue scaling operations in the region [8] - The company aims to maintain its leadership in BPO 3.0 by investing in talent and resources to support AI-driven growth [10][11] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company’s ability to sustain growth momentum, with expectations of further revenue and adjusted EBITDA guidance increases for the fiscal year [25][26] - The company anticipates a more consistent revenue flow throughout the year, moving away from historical seasonal spikes [33] Other Important Information - The company repurchased approximately 78,000 shares for $2.9 million during the quarter, with a total of 170,000 shares repurchased for $5.6 million in the fiscal year [24] - The company ended the quarter with a net cash position of $14 million, consistent with the previous fiscal year [24] Q&A Session Summary Question: Demand and impact of AI on the company - Management stated that the company has established itself as a leader in AI, which aids in winning new clients and enhances operational execution, contributing to market share growth [28][30] Question: Changes in revenue patterns due to business mix - Management indicated that the mix shift towards higher-margin sectors may lead to a more consistent revenue flow throughout the year, reducing the historical seasonal decline [32][34] Question: Gross margins and operating expenses - Management acknowledged that while gross margins have decreased year-over-year, SG&A expenses are growing at a slower rate than revenue, which is favorable for long-term margin trajectory [36][37]

Core Insights - The company reported strong fiscal second-quarter results, highlighting record revenue and earnings, with a revenue increase of 16.7% year-over-year to $164.2 million and adjusted EBITDA reaching a record $20.7 million, representing 12.6% of revenue [3][4][6] Financial Performance - Adjusted net income rose to $12.8 million from $9.6 million, and adjusted diluted EPS increased to $0.87 from $0.59 [1] - Net income for the quarter was $12.2 million, compared to $9.3 million a year ago, with fully diluted EPS at $0.83, up from $0.57 [2] - The company raised its full-year revenue guidance to $620–630 million, up from $605–620 million, and adjusted EBITDA guidance to $80–82 million, up from $78–81 million [16] Revenue Growth Drivers - Growth was driven predominantly by strength in health tech, which grew by 35.1% and is on track to reach approximately $100 million by year-end [5][6] - Digital and omnichannel services accounted for 82% of total revenue, growing 19% year-over-year [7] - The telecom vertical fell below 10% of revenue for the first time since the company's IPO, attributed to lower volume from legacy carriers [9] Capital Deployment and Cash Flow - Capital expenditures increased to $11.7 million, representing 7.1% of revenue, from $4.3 million (3.1%) a year ago, primarily for offshore expansion [14] - The company reported net cash from operations of $6.6 million for the quarter, up from $1.1 million in the prior-year period [13] - Free cash flow was an outflow of $5.1 million, compared to an outflow of $3.2 million in the prior-year quarter [14] Strategic Initiatives - The company is investing in artificial intelligence and expanding offshore delivery capabilities, with nearly 1,000 agents in India [10][11] - IBEX's AI offerings are designed to enhance client-facing solutions and improve internal processes, supporting operational execution and new client acquisitions [10] Client and Vertical Mix - The largest client accounted for 10% of second-quarter revenue, with the top five, top ten, and top twenty-five clients representing 39%, 57%, and 79% of revenue, respectively [7] - Vertical contributions included health tech at 17.4% of revenue, travel and logistics at 14.1%, and telecommunications at 8.7% [8][19]

Financial Data and Key Metrics Changes - The company reported headline revenue growth of 17% and adjusted EPS growth of 46% in Q2 FY 2026, marking the fourth consecutive quarter of double-digit organic revenue growth [4][5] - Second quarter revenue was $164.2 million, an increase of 16.7% from $140.7 million in the prior year quarter [13] - Net income increased to $12.2 million from $9.3 million in the prior year quarter, driven by growth in higher margin offshore regions [16] - Fully diluted EPS was $0.83, up 45% from $0.57 in the prior year quarter [17] - Adjusted EBITDA increased to a record of $20.7 million, or 12.6% of revenue, from $16.5 million, or 11.8% of revenue, for the same period last year [18] Business Line Data and Key Metrics Changes - Revenue growth was driven by health tech (35.1%), travel, transportation, and logistics (20.2%), and retail and e-commerce (17.2%), while telecommunications declined by 23.1% [14] - Health tech increased to 17.4% of second quarter revenue versus 15.1% in the prior year quarter [20] - The telecommunications vertical decreased to 8.7% of revenue for the quarter versus 13.1% in the prior year quarter [21] Market Data and Key Metrics Changes - Offshore revenues comprised 52.3% of total revenue, with highest margin offshore revenues growing 16.2% compared to the prior year quarter [14] - Onshore revenues expanded to 24% of total revenue from 22% in the prior year quarter [15] Company Strategy and Development Direction - The company is focused on expanding its AI capabilities and strategic investments in high-margin verticals, particularly health tech [9][10] - Expansion into India is seen as a key growth vector, with nearly 1,000 agents operational and plans for broader revenue cycle management services [6][7] - The company aims to define the market for BPO 3.0, moving beyond traditional BPO services [10] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's position for the second half of the fiscal year, citing a structurally sound company with a market-leading growth profile [11] - The company anticipates raising revenue and adjusted EBITDA guidance for the year, now expecting revenue in the range of $620 million-$630 million [26] Other Important Information - The company repurchased approximately 78,000 shares for $2.9 million during the quarter, with a total of 170,000 shares repurchased for $5.6 million in the fiscal year [23] - The company ended the second quarter with $15.5 million of cash and a net cash position of $14 million [24] Q&A Session Summary Question: Demand and Impact of AI on the Company - Management stated that the company has established itself in the AI leadership position, which aids in winning new clients and operational execution [28][30] Question: Changes in Revenue Patterns Due to Business Mix - Management indicated that the mix has changed favorably, leading to a more consistent revenue flow throughout the year, rather than a massive spike in Q2 [32][34] Question: Gross Margins and Operating Expenses - Management acknowledged that while gross margins have decreased year-over-year, SG&A expenses have decreased as a percentage of revenue, indicating effective cost management [35][36]

Built for what's next. ibex Q2 FY2026 Earnings Call February 5, 2026 Bob Dechant, CEO Disclaimer This presentation includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements contained in this presentation, other than statements of historical facts, are forward-looking statements. The words "believe," "estimate," "expect," "may," "will" and similar expressions are intended to identify forward-looking statements. Such forward- looking stateme ...

Financial Performance - The company reported revenues of $164.2 million for the three months ended December 31, 2025, a 16.7% increase compared to the prior year quarter[110]. - Net income for the same period was $12.2 million, reflecting a 31.8% increase from $9.3 million in the prior year quarter[110]. - For the six months ended December 31, 2025, revenues reached $315.4 million, a 16.6% increase compared to the same period in the prior year[111]. - The company achieved a net income of $24.3 million for the six months ended December 31, 2025, a 44.4% increase from $16.8 million in the prior year[111]. - Revenue for the six months ended December 31, 2025, was $315.4 million, an increase of $45.0 million or 16.6% year-over-year, driven by growth in Retail & E-commerce, HealthTech, and Other verticals[144]. Operational Highlights - The HealthTech vertical grew by $7.4 million, or 35.1%, contributing to the overall revenue increase[130]. - The Telecommunications vertical experienced a decline of $4.3 million, or 23.1%, impacting overall performance[130]. - Income from operations was $29.0 million for the six months ended December 31, 2025, compared to $21.0 million in the prior year, with an operating margin of 9.2%, up from 7.8%[154]. - Payroll and related costs increased to $87.4 million, a 14.7% rise compared to the prior year quarter, but as a percentage of revenue, it decreased to 53.2%[133]. - SG&A expenses rose to $54.1 million, an increase of $2.2 million or 4.2% compared to the prior year period, primarily due to higher payroll and related costs[152]. Technology and Innovation - The company is leveraging AI technology through its Wave iX platform to enhance customer experience and operational efficiency[115]. Cash Flow and Liquidity - Net cash provided by operating activities during the six months ended December 31, 2025, was $22.3 million, significantly higher than $8.9 million in the prior year[172][187]. - Free cash flow for the six months ended December 31, 2025, was $2.9 million, compared to $1.0 million in the prior year[172]. - The company expects its existing cash balance and cash generated from operations to meet liquidity requirements for at least the next twelve months[178]. Debt and Financing - The company had total debt of $1.4 million as of December 31, 2025, and was in compliance with all debt covenants[177]. - As of December 31, 2025, the Company had no outstanding balances on the HSBC Credit Facilities, indicating no immediate interest rate risk exposure[200]. - Borrowings under the U.S. Credit Facility bear interest at a rate equal to term SOFR plus 2%, while the UAE Loan Facility bears interest at 3-month term SOFR plus 2%[200]. Tax and Expenses - The effective tax rate was 15.2% for the six months ended December 31, 2025, down from 20.5% in the prior year, attributed to changes in revenue mix and discrete tax benefits[158]. - Interest expense decreased to $0.5 million, a reduction of $0.3 million or 40.5% compared to the prior year period[156]. - Depreciation and amortization expense was $9.1 million, an increase of $0.5 million or 5.5% compared to the prior year period, with D&A as a percentage of revenue decreasing to 2.9%[153]. Foreign Currency Exposure - The Company has significant foreign currency exposure, primarily in Philippine Peso (PHP), Jamaican Dollar, and Pakistani Rupee, which could adversely impact financial results[195]. - A 10% appreciation/depreciation in PHP against the U.S. dollar would have increased or decreased expenses by approximately $7.5 million or $6.2 million, respectively, for the six months ended December 31, 2025[197]. - A 10% appreciation/depreciation in Jamaican Dollar against the U.S. dollar would have increased or decreased expenses by approximately $2.3 million or $1.9 million, respectively, for the same period[197]. - A 10% appreciation/depreciation in Pakistani Rupee against the U.S. dollar would have increased or decreased expenses by approximately $3.0 million or $2.4 million, respectively, for the same period[197]. - The Company hedges a portion of its Philippine operating costs to mitigate foreign exchange fluctuations, although a strengthening PHP could adversely impact long-term margins[196]. Shareholder Returns - The current share repurchase program allows for up to $15 million in shares to be repurchased through May 12, 2026[181]. Adjusted Metrics - Adjusted net income for the three months ended December 31, 2025, was $12.8 million, with an adjusted net income margin of 7.8%[163]. - For the three months ended December 31, 2025, net income was $12.2 million, representing a net income margin of 7.4%, up from 6.6% in the prior year quarter[168][169]. - Adjusted EBITDA for the same period was $20.7 million, with an adjusted EBITDA margin of 12.6%, compared to 11.8% in the prior year quarter[168][170].