Financial Data and Key Metrics Changes - Total billings grew by 18% to $2.37 billion in Q4 2025, driven by strong growth in Unified SASE and operational technology security [13][20] - Total revenue increased by 15% to $1.91 billion, with product revenue up over 20% to $691 million and service revenue growing 12% to $1.21 billion [15][21] - Operating margin was strong at 37.3%, exceeding guidance, while gross margin was 80.3% [20][22] - Free cash flow reached $577 million, representing a margin of 31% [20][23] Business Line Data and Key Metrics Changes - Unified SASE billings grew 40%, representing 27% of total billings, indicating strong demand for cloud security solutions [6][15] - Operational technology solutions saw billings growth of over 25%, driven by demand for both hardware and software [9][14] - AI-driven SecOps billings grew 6% in Q4 and 22% for the full year, with annual recurring revenue (ARR) up 21% [9][15] Market Data and Key Metrics Changes - The U.S. and Europe were the largest contributors to growth in $1 million-plus deals, each delivering more than 30% growth [14] - 16% of large enterprise customers purchased FortiSASE, an increase of over 50%, highlighting continued expansion [13][15] - The company maintains a leading position in the firewall market with a 55% unit market share [5] Company Strategy and Development Direction - The company aims to continue growing faster than the overall market, targeting a billings and revenue CAGR above 12% [10][26] - Focus on integrating networking and security through FortiOS, which enhances performance and reduces total cost of ownership [6][12] - Continued investment in R&D, particularly in AI-driven security and quantum readiness, supports rapid innovation and organic growth [12][26] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in sustained growth driven by strong demand across cybersecurity markets, including Secure Networking and Unified SASE [11][32] - The company anticipates service revenue growth to accelerate in the second half of 2026, driven by product revenue growth [24][26] - Management highlighted the importance of addressing supply chain challenges and maintaining healthy margins through strategic pricing [41][42] Other Important Information - The company has a disciplined approach to capital allocation, with a focus on maintaining the Rule of 45 and strong free cash flow generation [12][13] - A $1 billion increase in the authorized stock repurchase amount was approved by the board of directors [20] Q&A Session Summary Question: What drove the strength in Unified SASE billings and the strong guidance for 2026? - Management attributed the 40% growth in Unified SASE to unique advantages such as Sovereign SASE and the integration of network security, SD-WAN, and SASE on a single OS [30][31] Question: How is the company navigating the current environment regarding memory prices? - The company has prepared for supply chain issues by maintaining inventory and adjusting prices to manage margins effectively [41][42] Question: What is the revenue mix between Sovereign and public SASE? - Management indicated that the Sovereign SASE market is likely larger than the public SASE market, with strong growth expected due to a lack of competition in this area [49] Question: How does the company view the potential for AI to impact cybersecurity? - Management sees AI as an opportunity to enhance cybersecurity measures and control data leakage, with significant demand for AI-driven solutions [36][38] Question: What is the company's approach to M&A? - The company remains open to M&A opportunities, particularly in secure operations, but emphasizes a disciplined approach to acquisitions [86]

Financial Data and Key Metrics Changes - In Q1 fiscal 2026, the company reported revenue of CAD 4.1 billion, an increase of 7.7% year-over-year, or 3.4% when excluding foreign exchange impacts [5] - Adjusted EBIT was CAD 655 million, up 7.1% year-over-year, with a margin of 16.1%, down 10 basis points [9] - Adjusted net earnings were CAD 461 million, with a margin of 11.3%, and diluted EPS was CAD 2.12, an increase of 8% compared to Q1 last year [10] - Cash generated from operations was CAD 872 million, representing 21.4% of total revenue, with DSO improving to 37 days [10][11] Business Line Data and Key Metrics Changes - The APAC delivery center reported growth of 5.8%, driven by managed services [5] - The UK and Australia segment grew by 31% due to the acquisition of BJSS, enhancing the company's service offerings [5] - Western and Southern Europe segment saw a growth of 9%, led by the acquisition of Apside [7] - Managed services had a book-to-bill ratio of 117%, indicating strong demand [8] Market Data and Key Metrics Changes - Bookings in the quarter reached CAD 4.5 billion, with a book-to-bill ratio of 110% [7] - The U.S. federal segment was impacted by a government shutdown, but bookings excluding this segment showed a combined book-to-bill of 118% [8] - The government sector pipeline of opportunities increased by 30% compared to the previous year, indicating strong demand for modernization and cybersecurity [16] Company Strategy and Development Direction - The company is focused on a build and buy strategy, emphasizing investments in AI and strategic acquisitions [12][21] - The capital allocation priorities include investing back into the business, pursuing accretive acquisitions, and share buybacks [12][22] - The company aims to leverage its local presence and global scale to enhance client relationships and service delivery [12][22] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term potential of the U.S. federal market despite short-term challenges [34] - The company anticipates gradual improvement in various industries and geographies, driven by strong client demand for AI and digital transformation [28] - The management highlighted the importance of trust and industry knowledge in navigating the current geopolitical and economic landscape [27] Other Important Information - The company approved a quarterly cash dividend of CAD 0.17 per share, payable on March 20, 2026 [11] - The board of directors renewed the NCIB program until February 2027, allowing for the repurchase of up to 19 million shares [11] Q&A Session Summary Question: Impact of AI volatility on acquisitions - Management stated that AI remains an enabler for future growth and does not change their M&A strategy [32][33] Question: U.S. federal government business outlook - Management believes the federal government remains a strong client despite recent shutdowns, with long-term opportunities still present [34] Question: Margins in U.S. federal segment - Margins were impacted by the shutdown, but management expects improvement as operations normalize [39][40] Question: Vendor consolidation trends - Management noted an increase in vendor consolidation among clients, providing opportunities for the company to win new business [44][46] Question: Enterprise AI adoption cycle - Management indicated that while many companies have deployed AI tools, realizing outcomes requires addressing data quality and infrastructure challenges [48][55] Question: Internal use of AI and margin improvements - Management confirmed that AI is already generating savings, with expectations for margin improvements in the future [58][60]

Financial Data and Key Metrics Changes - In Q1 fiscal 2026, the company reported revenue of CAD 4.1 billion, an increase of 7.7% year-over-year, or 3.4% when excluding foreign exchange impacts [5] - Adjusted EBIT was CAD 655 million, up 7.1% year-over-year, with a margin of 16.1%, down 10 basis points [9] - Adjusted net earnings were CAD 461 million, with a margin of 11.3%, and diluted EPS was CAD 2.12, an increase of 8% compared to Q1 last year [10] - Cash generated from operations was CAD 872 million, representing 21.4% of total revenue, with DSO improving to 37 days [10][11] Business Line Data and Key Metrics Changes - The APAC delivery center reported growth of 5.8%, driven by managed services [5] - The UK and Australia segment grew by 31% due to the acquisition of BJSS, enhancing the company's service offerings [5] - The Western and Southern Europe segment saw a growth of 9%, led by the acquisition of Apside [7] - Managed services had a book-to-bill ratio of 122%, indicating strong demand [8] Market Data and Key Metrics Changes - Bookings in the quarter reached CAD 4.5 billion, resulting in a book-to-bill ratio of 110% [7] - The U.S. commercial and state government segment had a book-to-bill ratio of 169% [7] - The government sector pipeline of opportunities increased by 30% compared to the previous year [16] Company Strategy and Development Direction - The company is focused on a build and buy strategy, emphasizing investments in AI and strategic acquisitions [12][22] - The capital allocation priorities include investing back into the business, pursuing accretive acquisitions, and share buybacks [12][22] - The company aims to leverage its local presence and global scale to enhance client relationships and service delivery [12][22] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the U.S. federal market despite recent shutdowns, viewing it as a long-term opportunity [34] - The company anticipates gradual improvement in various industries and geographies, driven by strong client demand for AI and digital transformation [28] - Management highlighted the importance of trust and industry knowledge in navigating the current geopolitical and economic landscape [27] Other Important Information - The board approved a quarterly cash dividend of CAD 0.17 per share, payable on March 20, 2026 [12] - The company has CAD 2.4 billion in capital resources available and a net debt leverage ratio of 1, indicating strong balance sheet capacity [12] Q&A Session Summary Question: Impact of AI volatility on acquisitions - Management stated that AI remains an enabler for future growth and does not change their M&A strategy [32][33] Question: U.S. federal government business outlook - Management believes the federal government remains a strong client despite recent shutdowns, viewing it as a long-term market [34] Question: Margins in U.S. federal business - Margins were impacted by the shutdown, but management expects improvement as operations normalize [40][41] Question: Vendor consolidation trends - Management noted an increase in vendor consolidation among clients, providing opportunities for the company [45][46] Question: Enterprise AI adoption cycle - Management indicated that while many companies have deployed AI tools, realizing outcomes requires addressing data quality and infrastructure challenges [49][56] Question: Internal AI use and margin improvement - Management confirmed that AI is already contributing to efficiency and margin improvements, with expectations for continued gains [60][61]

Core Insights - Datadog, Inc. (NASDAQ:DDOG) is identified as one of the software stocks with significant upside potential, with recent analyst updates indicating varying price targets and ratings [1][2] Analyst Updates - Truist Financial analyst Miller Jump reduced the price target for Datadog from $195 to $140 while maintaining a Hold rating, suggesting a 14.5% upside from current levels as of January 10 [1] - RBC Capital analyst Matthew Hedberg lowered the price target from $216 to $175 but kept a Buy rating, indicating a potential 43% upside from current levels [2] Market Position and Outlook - BTIG analysts included Datadog in their 2026 list of favored names in security and infrastructure software, highlighting a positive outlook for the observability space and the benefits from vendor consolidation and AI workload proliferation [3] - Datadog operates a security and observability platform for cloud applications, offering products such as log management, database monitoring, and digital experience monitoring [3]

Financial Data and Key Metrics Changes - IT services sequential revenue for Q3 was $2.64 billion, growing 1.4% in constant currency and 1.2% in reported currency, with a year-on-year growth of 0.2% in reported currency [10][11] - Operating margins improved to 17.6%, an increase of 40 basis points from Q2 and 10 basis points year-on-year, marking one of the best margin performances in recent years [10][11] - Adjusted net income for the quarter was INR 33.6 billion, with adjusted EPS at INR 3.21, reflecting a 3.5% sequential increase and flat year-on-year [11] Business Line Data and Key Metrics Changes - BFSI sector grew 2.6% sequentially and 0.4% year-on-year, while Health sector grew 4.2% sequentially and 1% year-on-year [12][13] - Consumer sector saw a sequential growth of 0.7% but a year-on-year decline of 5.7% [13] - Technology and Communications sector grew 4.2% sequentially and 3.5% year-on-year, while EMR declined 4.9% sequentially and 5.8% year-on-year [13] Market Data and Key Metrics Changes - Americas 1 market grew 1.8% sequentially and 2.8% year-on-year, while Americas 2 declined 0.8% sequentially and 5.2% year-on-year [12] - Europe market grew 3.3% sequentially but declined 4.6% year-on-year, while APMEA grew 1.7% sequentially and 6.6% year-on-year [12][13] Company Strategy and Development Direction - The company is positioning itself for an AI-first world, focusing on AI-led transformation across industries [2][4] - Three strategic pillars include industry platforms and solutions, delivery platforms for AI adoption, and the Wipro Innovation Network to foster partnerships and explore new technologies [5][6] - The company aims to maintain margins while integrating the Harman DTS acquisition, which is expected to enhance engineering and AI capabilities [9][11] Management's Comments on Operating Environment and Future Outlook - Management noted a strong pipeline of opportunities across sectors, with AI becoming central to client strategies for modernization and efficiency [20][21] - The guidance for Q4 projects IT services revenue growth of 0-2% in constant currency, factoring in the Harman DTS acquisition and fewer working days [9][15] - Management expressed confidence in maintaining margins despite challenges in the revenue environment and pricing pressures [42] Other Important Information - The board declared an interim dividend of INR 6 per share, with total cash distributed to shareholders exceeding $1.3 billion for the financial year [15] - The company has established centers of excellence in collaboration with universities to enhance recruitment of AI-skilled talent [34][36] Q&A Session Summary Question: What are the expectations for FY 2027 compared to FY 2026? - Management indicated a strong pipeline and secular growth across sectors, suggesting optimism for FY 2027 [18] Question: What is the impact of AI on deal bookings? - Management clarified that AI is not compressing deal bookings but is instead leading to more opportunities [56] Question: How is the company addressing geopolitical uncertainties? - Management noted that while geopolitical uncertainties exist, they do not significantly impact client decision-making at this time [32] Question: What is the recruitment strategy for AI skills? - The company is focusing on campus recruitment and upskilling existing talent, with plans to hire 2,500 freshers in the next quarter [45][46] Question: What is the outlook for discretionary spending? - Management is closely monitoring discretionary spending as clients finalize budgets, indicating a strong pipeline across sectors [24][25]

Financial Data and Key Metrics Changes - IT services sequential revenue for Q3 was $2.64 billion, growing 1.4% in constant currency and 1.2% in reported currency, with a year-on-year growth of 0.2% in reported currency [10][11] - Operating margins were at 17.6%, expanding 40 basis points sequentially and 10 basis points year-on-year, marking one of the best margin performances in recent years [10][11] - Adjusted net income for the quarter was INR 33.6 billion, with adjusted EPS at INR 3.21, reflecting a 3.5% sequential increase and flat year-on-year [11] Business Line Data and Key Metrics Changes - BFSI sector grew 2.6% sequentially and 0.4% year-on-year, while healthcare grew 4.2% sequentially and 1% year-on-year [12][13] - Consumer sector saw a sequential growth of 0.7% but a year-on-year decline of 5.7% [13] - Technology and communication sector grew 4.2% sequentially and 3.5% year-on-year, while EMR declined 4.9% sequentially and 5.8% year-on-year [13] Market Data and Key Metrics Changes - Americas 1 market grew 1.8% sequentially and 2.8% year-on-year, while Americas 2 declined 0.8% sequentially and 5.2% year-on-year [12] - Europe grew 3.3% sequentially but declined 4.6% year-on-year, while APMEA grew 1.7% sequentially and 6.6% year-on-year [12][13] Company Strategy and Development Direction - The company is positioning itself for an AI-first world, focusing on AI-led transformation across industries [2][3] - Three strategic pillars include industry platforms and solutions, delivery platforms for AI adoption, and the Wipro Innovation Network to connect with partners and startups [5][6] - The company aims to maintain margins while integrating the Harman DTS acquisition, which adds engineering and AI capabilities [9][11] Management's Comments on Operating Environment and Future Outlook - Management noted a strong pipeline of opportunities across sectors, with AI becoming central to client strategies [20][21] - The guidance for Q4 projects IT services revenue growth of 0-2% in constant currency, influenced by fewer working days and delays in ramp-ups [9][15] - Management expressed confidence in maintaining margins despite challenges in the revenue environment and pricing pressures [42][43] Other Important Information - The board declared an interim dividend of INR 6 per share, with cash distributed to shareholders exceeding $1.3 billion for the financial year [15] - The company has completed restructuring exercises and does not anticipate further charges related to the Labor Code implementation [14][15] Q&A Session Summary Question: What are you hearing from clients regarding revenue and AI? - Management indicated a strong pipeline and secular growth across sectors, with AI being a central theme in client discussions [18][20] Question: What is the outlook for discretionary spending? - Clients are focusing on cost optimization and leveraging AI for efficiency, with a strong pipeline across sectors [24][25] Question: What is the impact of geopolitical uncertainties on client decision-making? - Management noted that while uncertainties exist, clients are responding positively to market conditions, particularly in the U.S. [32][39] Question: How is the company addressing AI skills in recruitment? - The company is creating centers of excellence in collaboration with universities to build AI-related curricula and recruit talent [34][36] Question: What is the strategy regarding public sector deals? - The company is focused on partnering with GCCs and leveraging its capabilities to support clients in the public sector [64][71]

Financial Data and Key Metrics Changes - IT services revenue for Q3 2026 was $2.64 billion, reflecting a sequential growth of 1.4% in constant currency and 0.2% year-on-year in reported currency [3][10] - Operating margins improved to 17.6%, an increase of 40 basis points from Q2 and 10 basis points year-on-year, marking one of the best margin performances in recent years [10][11] - Adjusted net income for the quarter was INR 33.6 billion, with adjusted EPS at INR 3.21, representing a 3.5% sequential increase and flat year-on-year [11] Business Line Data and Key Metrics Changes - BFSI sector grew 2.6% sequentially and 0.4% year-on-year, while healthcare grew 4.2% sequentially and 1% year-on-year [12] - Consumer sector saw a sequential growth of 0.7% but a decline of 5.7% year-on-year, indicating mixed performance [12] - Technology and communication sectors grew 4.2% sequentially and 3.5% year-on-year, while EMR declined 4.9% sequentially and 5.8% year-on-year [12] Market Data and Key Metrics Changes - Americas 1 market unit grew 1.8% sequentially and 2.8% year-on-year, while Americas 2 declined 0.8% sequentially and 5.2% year-on-year [11] - Europe experienced a sequential growth of 3.3% but a year-on-year decline of 4.6% [11] - APMEA region grew 1.7% sequentially and 6.6% year-on-year, driven by strong performance in India, the Middle East, and Southeast Asia [12] Company Strategy and Development Direction - The company is positioning itself for an AI-first world, focusing on AI-led transformation across industries [2][3] - Strategic pillars include industry platforms and solutions, delivery platforms for AI adoption, and the Wipro Innovation Network to foster partnerships and innovation [5][6] - The company aims to maintain operational rigor and margin performance while integrating the Harman DTS acquisition to enhance engineering and AI capabilities [9][10] Management's Comments on Operating Environment and Future Outlook - Management noted a strong pipeline of opportunities, with AI becoming central to client strategies for modernization and efficiency [19][20] - The guidance for Q4 projects IT services revenue growth of 0-2% in constant currency, factoring in the Harman DTS acquisition and fewer working days [9][15] - Management expressed confidence in maintaining margins despite challenges from large deal ramp-ups and pricing pressures [40][41] Other Important Information - The board declared an interim dividend of INR 6 per share, with total cash distributed to shareholders exceeding $1.3 billion for the financial year [15] - The company recorded two one-off charges impacting net income: INR 302 crores for graduate expenses and INR 263 crores for restructuring [13] Q&A Session Summary Question: Insights on client spending and AI revenue - Management indicated a strong pipeline and secular growth across sectors, with AI becoming a focal point for client projects [17][19] Question: Reasons for TCV decline and outlook - Management clarified that TCV bookings were strong year-to-date, with a healthy pipeline despite quarterly fluctuations [25][26] Question: Impact of geopolitical uncertainties on client decisions - Management noted that while geopolitical uncertainties exist, they do not significantly impact client decision-making at this time [31] Question: Recruitment plans and AI skills - The company is focusing on building AI skills through partnerships with universities and plans to ramp up campus recruitment [32][34] Question: Discretionary spending outlook - Management is closely monitoring discretionary spending as clients finalize budgets, with a strong pipeline expected to drive future growth [23][24]

Financial Data and Key Metrics Changes - IT services revenue for Q2 FY 2026 was $2.6 billion, with a sequential growth of 0.3% in constant currency and a year-on-year decline of 2.6% [6][18] - Adjusted operating margin for the quarter was 17.2%, an improvement of 0.4% compared to the same period last year [6][19] - Net income and EPS grew by 1% year on year, while operating cash flows remained higher than net income at 104% for Q2 [23] Business Line Data and Key Metrics Changes - Americas One grew 0.5% sequentially and 5% year on year, while Americas Two declined 2% sequentially and 5% year on year [20] - Europe reported a sequential growth of 1.4% but a year-on-year decline of 10.2% [21] - APMEA grew 3.1% sequentially and 2.6% year on year, with strong performance in India, Australia, and Southeast Asia [21] - BFSI sector showed sequential growth of 2%, driven by Europe and APMEA [85] Market Data and Key Metrics Changes - The healthcare sector is undergoing structural changes, impacting performance, but remains a strong performer for the company [9][88] - Consumer, energy, and manufacturing sectors are facing tariff uncertainties, leading to reevaluation of supply chains [9] Company Strategy and Development Direction - The company is focusing on AI adoption and vendor consolidation as key strategies for growth [9][10] - Wipro Intelligence, a unified suite of AI-powered platforms, is being introduced to enhance client capabilities [13][14] - The company aims to maintain operational discipline while converting a strong backlog into revenue [16] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in future growth, particularly in BFSI, as large deals begin to ramp up [30][31] - The company anticipates a sequential IT services revenue growth of -0.5% to +1.5% in constant currency for Q3 [16][24] - Management acknowledged headwinds from large deal ramp-ups and seasonal factors affecting Q3 performance [35] Other Important Information - The Harman Digital Transformation Solutions acquisition is expected to close in the upcoming quarter, but revenues from this acquisition are not included in current guidance [24] - The company is actively investing in growth, which may pressure margins in the short term [19][35] Q&A Session Summary Question: Thoughts on deal to revenue conversion and future growth - Management noted that large deal wins in BFSI are expected to ramp up in Q3, contributing to future growth [28][29] Question: Margin outlook and transition costs - Management indicated that while there are headwinds from large deals, operational improvements and currency fluctuations have positively impacted margins [32][34] Question: Sustainability of year-on-year growth in line with peers - Management expressed confidence in sustaining growth, focusing on executing deal wins and maintaining a robust pipeline [50][52] Question: Clarity on renewal deals and their impact - Management clarified that renewal deals are a mix of renewals and expansions, with some deflationary pressures expected [95][96] Question: Impact of bankruptcy on revenue - Management confirmed that there was no impact on Q2 revenue from the bankruptcy provision made [99]

Summary of Conference Call Company Overview - The conference call featured Concentrix, with CEO Chris Caldwell and CFO Andre Valentine discussing the company's performance and outlook in the digital transformation sector [1][3]. Key Points Financial Performance - Concentrix reported revenue exceeding guidance, indicating strong momentum in bookings, which is expected to continue into the second half of the year [3][4]. - The company raised its revenue guidance for the latter half of the year due to robust growth in its IX Hello and IX Hero product suites [3][4]. Demand Trends - There is a modest organic acceleration in growth anticipated for the second half of the year, driven by strong bookings related to generative AI capabilities and vendor consolidation trends [5][6]. - Budget caution remains prevalent among clients, particularly for traditional services, but this caution is viewed positively as it allows Concentrix to help clients operate more efficiently [8][10]. Vertical Performance - Strong performance is noted in the BFSI (Banking, Financial Services, and Insurance) sector, with healthcare showing signs of recovery and travel and transportation experiencing unexpected growth [9][10]. - Some sectors, like automotive, are facing challenges due to tariffs, but overall, there is steady growth across various verticals [9][10]. Tariff Impact - Clients are adapting to tariff changes, leading to more resilient supply chains, although ongoing tariff fluctuations continue to create uncertainty [12][13]. Margin and Delivery Mix - The company anticipates a positive margin trajectory as investments in generative AI tools reach breakeven and begin to contribute positively to margins [15][17]. - The shift towards offshore services is creating a short-term revenue headwind but is expected to be accretive to margins in the long term [18][19]. Platform Strategy and AI - Concentrix's strategy has increasingly focused on technology-led solutions, with a significant portion of new deals being multi-pillar transformational rather than standard services [21][22]. - The acquisition of Catalyst (formerly Prokarma) is seen as a go-to-market enabler, enhancing the company's technical capabilities [24][25]. AI Product Adoption - The IX Hello and IX Hero products are seeing increased adoption, with Concentrix claiming to have one of the largest deployments of AI across desktops in the industry [28][29]. - The IX Hello platform focuses on complete automation, while the company is cautious about deployment to protect brand integrity and ensure data readiness [31][32]. Competitive Landscape - Concentrix differentiates itself from pure-play AI vendors by emphasizing compliance, regulatory considerations, and the integration of complex customer journeys [34][36]. - The company is positioned to compete effectively against larger players by offering a full suite of services and solutions [43][44]. Future Outlook - The company sees significant growth potential in adjacent services, particularly in data annotation, which is expected to drive future revenue streams [50][51]. - Concentrix remains open to M&A opportunities, focusing on client needs and potential synergies to enhance its service offerings [52][53]. Strategic Vision - The leadership expressed excitement about the company's investments over the past years coming to fruition, positioning Concentrix favorably in an expanding marketplace [57]. Additional Insights - The integration of the WebHelp acquisition has been successful, achieving synergy targets and enhancing the company's footprint in Europe and Latin America [55][56].

Financial Data and Key Metrics Changes - Revenues grew 2.6% sequentially and 3.8% year on year in constant currency terms [6][10] - Operating margin was 20.8%, down 20 basis points quarter on quarter and 30 basis points year on year [14][16] - Free cash flow was $884 million, representing 109% of net profit, marking the fifth consecutive quarter of free cash flow exceeding 100% of net profit [15][16] - EPS in rupee terms grew by 8.6% and in dollar terms grew by 5.8% year on year [15] Business Line Data and Key Metrics Changes - Growth was broad-based with significant contributions from enterprise AI and large deal wins, totaling $3.8 billion [6][16] - Manufacturing grew in double digits, while financial services saw good momentum in the U.S. [13][20] - The company signed nine deals in communication, six in URS, five in manufacturing, four in financial services, and two each in high-tech and retail [17] Market Data and Key Metrics Changes - North America grew 2.9% sequentially in constant currency, while Europe grew 12.3% year on year, significantly above the company average [14] - The company noted that clients remain cautious in discretionary spending, impacting decision-making timelines [20][24] Company Strategy and Development Direction - The company revised its revenue guidance for FY 2026 to 1% to 3% growth in constant currency terms, reflecting ongoing uncertainties in the macroeconomic environment [10][26] - Focus on enterprise AI and vendor consolidation as key growth drivers, with a strong pipeline for large and mega deals [23][26] - Continued investment in industry, cloud, energy transition, and AI-driven operational efficiency [23] Management's Comments on Operating Environment and Future Outlook - Management expressed that the business environment remains uncertain due to unresolved tariff issues and geopolitical tensions [19][20] - Near-term visibility is good, with expectations for stronger performance in the first half of the year compared to the second half [20][27] - Clients are increasingly interested in AI solutions, but discretionary spending remains cautious [24][105] Other Important Information - The company is positioned as a leader in Gartner's first generative AI consulting and implementer services quadrant [10] - The effective tax rate for the quarter was 28.9%, with expectations for the fiscal year to be in the range of 29% to 30% [19] Q&A Session All Questions and Answers Question: On organic growth momentum and guidance - Management indicated that the guidance reflects heightened uncertainty in the environment, despite strong Q1 performance [31][32] Question: On AI-related margin or pricing trade-offs - Management noted that productivity gains from enterprise AI are typically shared with clients, and they are actively engaging clients on these opportunities [35][36] Question: On Europe’s strong performance - Management attributed Europe’s growth to prior investments and successful large deal wins, with confidence in sustaining this growth [49][50] Question: On vendor consolidation and competition - Management believes that they are benefiting from vendor consolidation due to their strong delivery capabilities and AI solutions [55][56] Question: On the outlook for discretionary spending - Management stated that clients are currently cautious, and the timing for a return to discretionary spending remains uncertain [94][105]