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Core Insights - WNS has successfully closed its acquisition by Capgemini S.E. as per the Transaction Agreement dated July 6, 2025 [1] Company Summary - The acquisition marks a significant strategic move for WNS, enhancing its capabilities and market position within the industry [1] - Capgemini S.E. is expected to leverage WNS's expertise to strengthen its service offerings and expand its client base [1]

Core Insights - Capgemini has completed the acquisition of WNS, creating a global leader in Agentic AI-powered Intelligent Operations [1][2] - The acquisition is valued at $3.3 billion, with a cash consideration of $76.50 per WNS share [2] - Capgemini aims to leverage WNS's industry expertise and platforms to enhance its capabilities in transforming business processes [2] Financial Details - The total cash consideration for the acquisition amounts to $3.3 billion, excluding WNS's net financial debt, which was negligible as of March 31, 2025 [2][4] - Capgemini successfully priced €4.0 billion in bonds to finance the acquisition and refinance its financial debt [2] Strategic Vision - Both companies share a vision of utilizing agentic AI to transform business operations, focusing on efficiency and agility through hyper-automation [2] - The integration is expected to unlock long-term value for clients, employees, partners, and communities [2] Company Background - Capgemini is a global business and technology transformation partner with 350,000 team members across more than 50 countries [3] - The company reported global revenues of €22.1 billion for the year 2024 [3]

Group 1 - Leaders from Shell, Pfizer, BBC, Genpact, Santander, and WNS have been recognized as winners of the 2025 ISG Women in Digital Awards for the EMEA region [1]

Core Insights - WNS has provided an update regarding its acquisition by Capgemini, indicating progress in the transaction [1] Company Updates - The acquisition by Capgemini is a significant development for WNS, reflecting strategic growth and expansion efforts [1] - Details on the financial implications or specific terms of the acquisition have not been disclosed in the update [1] Industry Context - The acquisition aligns with broader trends in the industry where companies are increasingly pursuing mergers and acquisitions to enhance capabilities and market presence [1]

Group 1 - Leaders with Network Science, VOIS, LTI Mindtree, Bahwan CyberTek Supply Chain Consulting, WNS, and ResultsCX have been recognized with the ISG Women in Digital Awards [1]

Core Viewpoint - Capgemini has successfully acquired WNS, with the acquisition approved by WNS shareholders, marking a significant step towards creating a global leader in Agentic AI-powered Intelligent Operations [2][4]. Acquisition Details - The acquisition agreement was announced on July 7, 2025, with Capgemini set to pay $76.50 per share for WNS, totaling approximately $3.3 billion, excluding WNS's net financial debt [3][11]. - The transaction is pending customary regulatory approvals and is expected to close by the end of 2025 [4]. Company Background - Capgemini is a global business and technology transformation partner, with a workforce of 350,000 across more than 50 countries, and reported global revenues of €22.1 billion for 2024 [5].

PART I - Financial Information [Item 1. Financial Statements](index=5&type=section&id=Item%201.%20Financial%20Statements) The unaudited consolidated financial statements for Q2 2025 report total assets of **$1.57 billion**, revenue of **$353.8 million**, and net income of **$21.8 million**, preceding a **$3.3 billion** acquisition by Capgemini [Notes to Unaudited Consolidated Financial Statements](index=12&type=section&id=Notes%20to%20Unaudited%20Consolidated%20Financial%20Statements) Notes detail accounting policies, the **$66.1 million** Kipi.ai acquisition, revenue disaggregation, debt structure, and segment performance, alongside ongoing tax disputes and the Capgemini acquisition - On March 10, 2025, the Company acquired Haukea Holdings Inc. (Kipi.ai) for a total consideration of **$66.1 million**, resulting in goodwill of **$53.9 million**, attributed mainly to expected synergies and the assembled workforce[59](index=59&type=chunk)[60](index=60&type=chunk)[64](index=64&type=chunk) - During the quarter ended June 30, 2025, the company purchased **1,300,000** ordinary shares for **$75.4 million** and cancelled **4,100,000** treasury shares[123](index=123&type=chunk) - The company has outstanding tax assessment orders from Indian authorities for various years, which could result in an estimated **$2.5 million** in additional taxes, though the company believes these orders are unlikely to be sustained[148](index=148&type=chunk)[321](index=321&type=chunk)[323](index=323&type=chunk) Revenue by Service Type (Three Months Ended June 30) | Service Type | 2025 ($ thousands) | 2024 ($ thousands) | | :--- | :--- | :--- | | Industry-specific | 161,943 | 140,043 | | Finance and accounting | 65,397 | 64,702 | | Customer experience services | 59,324 | 61,333 | | Research and analytics | 49,865 | 40,511 | | Others | 17,265 | 16,526 | | **Total** | **353,794** | **323,115** | Consolidated Balance Sheet Summary (As of June 30, 2025) | Balance Sheet Item | June 30, 2025 ($ thousands) | March 31, 2025 ($ thousands) | | :--- | :--- | :--- | | **Total Current Assets** | 548,050 | 564,794 | | **Total Assets** | 1,568,836 | 1,547,503 | | **Total Current Liabilities** | 373,550 | 320,952 | | **Total Liabilities** | 771,065 | 709,779 | | **Total Shareholders' Equity** | 797,771 | 837,724 | Consolidated Statement of Income Summary (Three Months Ended June 30) | Income Statement Item | 2025 ($ thousands) | 2024 ($ thousands) | | :--- | :--- | :--- | | **Revenue** | 353,794 | 323,115 | | **Gross Profit** | 116,573 | 113,672 | | **Operating Income** | 33,103 | 38,573 | | **Net Income** | 21,750 | 28,922 | | **Diluted EPS** | $0.48 | $0.61 | Consolidated Statement of Cash Flows Summary (Three Months Ended June 30) | Cash Flow Item | 2025 ($ thousands) | 2024 ($ thousands) | | :--- | :--- | :--- | | **Net cash provided by operating activities** | 29,499 | 21,408 | | **Net cash provided by/(used in) investing activities** | 23,290 | (68,484) | | **Net cash (used in)/provided by financing activities** | (56,685) | 44,226 | | **Net change in cash, cash equivalents and restricted cash** | (3,660) | (2,963) | - On July 6, 2025, the Company entered into a transaction agreement to be acquired by Capgemini S.E. in an all-cash deal valued at approximately **$3.3 billion**, or **$76.50** per ordinary share, expected to close by the end of calendar year 2025, subject to shareholder and regulatory approvals[185](index=185&type=chunk)[186](index=186&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=51&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Q2 FY26 saw revenue grow **9.5%** to **$353.8 million**, but operating profit declined to **$33.1 million** and net income to **$21.8 million** due to higher costs and acquisition-related expenses, amidst global economic and currency risks - On July 6, 2025, WNS entered into an agreement to be acquired by Capgemini S.E. for approximately **$3.3 billion** in an all-cash transaction, expected to close by the end of calendar year 2025[200](index=200&type=chunk) - The company's business is exposed to global economic risks, including inflation, rising interest rates, and geopolitical conflicts such as the war in Ukraine, which particularly affects its operations in Poland and Romania[202](index=202&type=chunk)[204](index=204&type=chunk) - Currency fluctuations had a mixed impact, with appreciation of the pound sterling and Euro positively impacting results, while depreciation of the Indian rupee against the US dollar benefited cost structures for Q1 FY26[209](index=209&type=chunk)[210](index=210&type=chunk) Revenue Reconciliation (GAAP to Non-GAAP) | Metric | Q1 FY26 ($M) | Q1 FY25 ($M) | | :--- | :--- | :--- | | Revenue (GAAP) | 353.8 | 323.1 | | Less: Payments to repair centers | 13.9 | 10.7 | | **Revenue less repair payments (non-GAAP)** | **339.9** | **312.4** | [Results of Operations](index=65&type=section&id=Results%20of%20Operations) Q1 FY26 revenue grew **9.5%** to **$353.8 million**, but increased cost of revenue and G&A expenses, including acquisition costs, led to a decline in operating profit to **$33.1 million** and net income to **$21.8 million** - The increase in cost of revenue was driven by higher employee costs from headcount growth (including the Kipi.ai acquisition), increased facilities costs as more employees returned to the office, and higher repair payments[262](index=262&type=chunk) - General and administrative expenses increased primarily due to higher share-based compensation, transaction expenses for the proposed Capgemini acquisition, and costs related to the Kipi.ai acquisition[267](index=267&type=chunk) - Income tax expense rose to **$10.5 million** from **$9.1 million**, mainly due to the expiry of a tax holiday in Sri Lanka and higher taxable profits in jurisdictions with higher tax rates[274](index=274&type=chunk) Key Financial Metrics Comparison (Q1 FY26 vs Q1 FY25) | Metric ($ millions) | Q1 2025 | Q1 2024 | Change | % Change | | :--- | :--- | :--- | :--- | :--- | | **Revenue** | 353.8 | 323.1 | 30.7 | 9.5% | | **Gross Profit** | 116.6 | 113.7 | 2.9 | 2.6% | | **Operating Profit** | 33.1 | 38.6 | (5.5) | (14.2)% | | **Profit After Tax** | 21.8 | 28.9 | (7.2) | (24.9)% | [Results by Reportable Segment](index=74&type=section&id=Results%20by%20Reportable%20Segment) Q1 FY26 segment results show BFSI revenue grew **24.1%** to **$146.9 million** and MRHP by **9.5%** to **$84.3 million**, while HCLS declined **13.7%** to **$35.8 million** due to client loss - BFSI segment revenue growth was driven by a **$24.0 million** increase from existing clients and **$4.5 million** from new clients[291](index=291&type=chunk) - MRHP segment growth was primarily due to **$15.3 million** in revenue from new clients, partially offset by an **$8.0 million** decrease from existing clients[287](index=287&type=chunk) - HCLS segment revenue decreased mainly due to the loss of a large healthcare client[289](index=289&type=chunk) Segment Revenue (Three Months Ended June 30) | Strategic Business Unit | 2025 ($ millions) | 2024 ($ millions) | % Change | | :--- | :--- | :--- | :--- | | **BFSI** | 146.9 | 118.4 | 24.1% | | **TSLU** | 94.4 | 93.5 | 1.0% | | **MRHP** | 84.3 | 76.9 | 9.5% | | **HCLS** | 35.8 | 41.5 | (13.7)% | [Liquidity and Capital Resources](index=79&type=section&id=Liquidity%20and%20Capital%20Resources) As of June 30, 2025, the company held **$100.9 million** in cash and **$266.2 million** in debt, with operating cash flow increasing to **$29.5 million**, while the pending Capgemini acquisition restricts capital actions - The company's liquidity sources include cash on hand, cash from operations, and available credit lines, with **$266.2 million** in debt outstanding and **$153.8 million** in available credit lines, of which **$55.0 million** was drawn as of June 30, 2025[296](index=296&type=chunk)[299](index=299&type=chunk)[304](index=304&type=chunk) - The pending transaction with Capgemini restricts the company from taking certain actions outside the ordinary course of business, such as incurring material capital expenditures or issuing new debt, without the buyer's consent[298](index=298&type=chunk) - Net cash provided by operating activities increased to **$29.5 million** for the quarter, up from **$21.4 million** YoY, primarily due to a decrease in cash outflow for working capital[311](index=311&type=chunk)[312](index=312&type=chunk) - Net cash used in financing activities was **$56.7 million**, mainly due to **$75.4 million** in share repurchases and **$21.1 million** in long-term debt repayment, partially offset by **$40.0 million** drawn from short-term borrowings[317](index=317&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=87&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company faces significant exchange rate risk, with **48.1%** of expenses in Indian rupees and revenue in pound sterling/US dollars, mitigated by hedging, alongside interest rate risk from floating-rate debt - The company is exposed to significant exchange rate risk as approximately **48.1%** of its expenses are in Indian rupees, while revenue is primarily in pound sterling and US dollars[338](index=338&type=chunk) - A sensitivity analysis shows that a **10%** appreciation/depreciation of the pound sterling against the US dollar would impact revenue by approximately **$9.0 million**, while a similar change in the Indian rupee would impact expenses by approximately **$15.4 million** for the quarter[340](index=340&type=chunk) - Interest rate risk stems from floating-rate debt tied to SOFR and SONIA, which the company manages by maintaining a mix of fixed and floating rate borrowings[342](index=342&type=chunk) [Item 4. Controls and Procedures](index=89&type=section&id=Item%204.%20Controls%20and%20Procedures) Management confirmed effective disclosure controls and no material changes to internal controls during the quarter, with the recently acquired Kipi.ai operations excluded from the assessment scope - The Group CEO and Group CFO concluded that the company's disclosure controls and procedures were effective as of the end of the period[346](index=346&type=chunk) - No changes in internal control over financial reporting occurred during the quarter that have materially affected, or are reasonably likely to materially affect, the company's internal controls[347](index=347&type=chunk) - The scope of management's assessment of internal controls for the quarter excludes the operations of Kipi.ai, acquired in March 2025[348](index=348&type=chunk) PART II - Other Information [Item 1. Legal Proceedings](index=90&type=section&id=Item%201.%20Legal%20Proceedings) The company is not involved in any material legal proceedings beyond the ordinary course of business, except for tax proceedings noted in financial statements - The company states that the disposition of currently instituted or asserted lawsuits, claims, and proceedings is not expected to have a material adverse effect on its financial position, results of operations, or cash flows[350](index=350&type=chunk) [Item 1A. Risk Factors](index=90&type=section&id=Item%201A.%20Risk%20Factors) A new material risk factor highlights the pending **$3.3 billion** Capgemini acquisition, which could disrupt business, divert management, and, if terminated, result in a **$118.0 million** fee - A significant new risk factor relates to the pending acquisition by Capgemini S.E., valued at approximately **$3.3 billion**, with completion subject to shareholder and regulatory approvals and not guaranteed[352](index=352&type=chunk) - Risks during the pre-closing period include potential adverse reactions from clients, business uncertainty, diversion of management attention, and difficulty in attracting and retaining key personnel[353](index=353&type=chunk) - If the transaction fails to close, the company's share price could decline, investor confidence may fall, and WNS may be required to pay a termination fee of **$118.0 million** under certain circumstances[356](index=356&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=91&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) During Q2 2025, the company repurchased **1,300,000** ordinary shares for **$75.4 million** under its approved share repurchase program, funded by cash on hand - The share repurchases were conducted under a program approved in fiscal 2025, authorizing the repurchase of up to **3,000,000** ordinary shares through November 29, 2025[357](index=357&type=chunk) Share Repurchases (Three Months Ended June 30, 2025) | Period | Shares Purchased | Average Price Paid per Share ($) | Total Consideration ($ millions) | | :--- | :--- | :--- | :--- | | April 2025 | — | — | — | | May 2025 | 705,454 | 56.83 | ~40.1 | | June 2025 | 594,546 | 59.34 | ~35.3 | | **Total** | **1,300,000** | **57.98** | **75.4** | [Item 5. Other Information](index=93&type=section&id=Item%205.%20Other%20Information) No directors or officers adopted or terminated Rule 10b5-1 or non-Rule 10b5-1 trading arrangements during the quarter ended June 30, 2025 - No directors or officers adopted or terminated a Rule 10b5-1 trading arrangement or a non-Rule 10b5-1 trading arrangement during the quarter[359](index=359&type=chunk) [Item 6. Exhibits](index=94&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed with the Form 10-Q, including the Capgemini Transaction Agreement, employment agreement amendments, and CEO/CFO certifications - Key exhibits filed include the Transaction Agreement with Capgemini S.E., amendments to executive employment agreements, and required certifications under the Sarbanes-Oxley Act[360](index=360&type=chunk)

Core Insights - Capgemini Group's performance showed improvement in Q2 2025, with a solid book-to-bill ratio of 1.08 and stable operating margin at 12.4% [3][10] - Client demand is primarily driven by efficiency and cost optimization, with significant traction in cloud, data & AI, and digital core services [4][9] - The company has narrowed its constant currency growth outlook for 2025 to between -1% and +1% [5][36] Financial Performance - H1 2025 revenues were €11,107 million, a decrease of 0.3% year-on-year on a reported basis, but a slight increase of 0.2% at constant exchange rates [6][7] - Operating profit for H1 2025 was €976 million, down 15% year-on-year, with an operating margin of 8.8% [11][53] - Net profit attributable to the Group was €724 million, reflecting a 13% decline compared to H1 2024, with basic earnings per share at €4.26 [12][54] Regional Performance - North America revenues increased by 1.6% year-on-year, with an operating margin of 16.3% [14][50] - The UK and Ireland region saw a revenue increase of 6.0%, although the operating margin decreased to 18.1% [15][50] - France experienced a revenue decline of 5.0%, while the operating margin improved to 10.0% [16][50] - Asia-Pacific and Latin America region revenues grew by 8.7%, driven by strong performance in Financial Services [18][50] Business Segment Performance - Strategy & Transformation services grew by 1.3%, while Applications & Technology services increased by 2.6% [19][52] - Operations & Engineering revenues decreased by 1.5% [19][52] Cash Flow and Debt - Organic free cash flow for H1 2025 was €60 million, down from €163 million in H1 2024 [13][55] - Capgemini's net debt stood at €2.8 billion as of June 30, 2025, unchanged from the previous year [26][57] Strategic Initiatives - Capgemini announced the acquisition of WNS for $76.50 per share, expected to enhance its capabilities in Agentic AI-powered Intelligent Operations [28][29] - A share buyback program of €2 billion has been approved, to be funded by organic free cash flow [31] Sustainability Efforts - Capgemini updated its ESG policy, reinforcing its commitment to sustainable growth and responsible business practices [32][34] - The company received an Ecovadis Platinum rating for its sustainability achievements [33]

Core Viewpoint - The comparison between WNS (Holdings) Limited and Thomson Reuters (TRI) indicates that WNS is more attractive to value investors based on various financial metrics and rankings [1]. Group 1: Zacks Rank and Earnings Outlook - WNS currently has a Zacks Rank of 2 (Buy), while TRI has a Zacks Rank of 4 (Sell), suggesting a more favorable earnings outlook for WNS [3]. - The Zacks Rank system emphasizes companies with positive earnings estimate revisions, indicating that WNS is likely experiencing an improvement in its earnings outlook compared to TRI [3]. Group 2: Valuation Metrics - WNS has a forward P/E ratio of 16.25, significantly lower than TRI's forward P/E of 52.78, indicating that WNS may be undervalued relative to TRI [5]. - The PEG ratio for WNS is 1.88, while TRI's PEG ratio is 6.39, further suggesting that WNS is more attractive in terms of expected earnings growth [5]. - WNS has a P/B ratio of 4.13 compared to TRI's P/B of 7.53, reinforcing the notion that WNS is undervalued [6]. Group 3: Value Grades - Based on the analysis of various metrics, WNS holds a Value grade of B, while TRI has a Value grade of F, indicating a stronger position for WNS among value investors [6].