NYSE$EPAM

EPAM Systems Inc. · Q2 2024 earnings

Q2 2024 earnings · · Investor relations

Briefing

Reported a decrease in revenue and EPS due to challenging macro-demand environment.

EPAM reported a decrease in revenue by 2.0% year-over-year to $1.147 billion for Q2 2024. GAAP diluted EPS was $1.70, a decrease of $0.33 year-over-year, while non-GAAP diluted EPS was $2.45, a decrease of $0.19 year-over-year. The company narrows full year revenue guidance to $4.590 billion to $4.625 billion.

  • Revenues decreased to $1.147 billion, a year-over-year decrease of 2.0%.
  • GAAP income from operations was 10.5% of revenues and non-GAAP income from operations was 15.2% of revenues.
  • GAAP diluted EPS was $1.70, a decrease of $0.33 year-over-year, and non-GAAP diluted EPS was $2.45, a decrease of $0.19 year-over-year.
  • The Board of Directors approved a new share repurchase program with authorization to purchase up to $500 million of EPAM common stock.

Headline financials

Total Revenue

$1.15B

Previous: $1.17B-2.0%
EPS

$1.70

Previous: $2.64-35.6%
Operating Margin

10.5%

Previous: 12.3%-14.6%
Non-GAAP Operating Margin

15.2%

Previous: 16.3%-6.7%
Capital Expenditures

-$11.5M

Previous: -$14.8M+22.6%
Free Cash Flow

$87.2M

Previous: $105M-17.1%
Net Income

$98.6M

Previous: $120M-17.8%
Operating Income

$121M

Previous: $144M-16.5%
Gross Profit

$336M

Previous: $361M-7.1%
Cash & Equivalents

$1.79B

Previous: $1.78B+0.6%
Total Assets

$4.22B

Previous: $4.09B+3.2%
Stock-Based Comp

$35.7M

Previous: $33.1M+7.8%

Revenue & EPS history

EPAM · Revenue · Quarterly

$1.15B

Q2 2024-2%vs Q2 2023
Beat estimate in 13 of 15 quarters(87%)
ActualEstimate

Forward guidance

EPAM expects revenues for the full year to be between $4.590 billion and $4.625 billion. For the third quarter, EPAM expects revenues to be in the range of $1.145 billion to $1.155 billion, GAAP diluted EPS to be in the range of $1.75 to $1.83 and non-GAAP diluted EPS to be in the range of $2.65 to $2.73.

Tailwinds

  • Company expects revenues will be in the range of $1.145 billion to $1.155 billion for the third quarter.
  • Company expects GAAP diluted EPS will be in the range of $1.75 to $1.83 for the quarter.
  • Company expects non-GAAP diluted EPS will be in the range of $2.65 to $2.73 for the quarter.
  • Company narrows its expected range for revenues to $4.590 billion to $4.625 billion for the full year.
  • Company expects GAAP diluted EPS to now be in the range of $7.18 to $7.38 and non-GAAP diluted EPS to now be in the range of $10.20 to $10.40.

Headwinds

  • Company is expecting no aggregate improvement in demand for the remainder of the year.
  • Revenues on an organic constant currency basis excluding the impact of the exit from Russia will decline 2.9% at the midpoint of the range for the full year.
  • Company expects revenues will be in the range of $1.145 billion to $1.155 billion for the third quarter reflecting a year-over-year decline of 0.2% at the midpoint of the range.
  • Revenues on an organic constant currency basis excluding the impact of the exit from Russia will decline 1.4% at the midpoint of the range for the third quarter.
  • GAAP effective tax rate and its non-GAAP effective tax rate to be approximately 24% for the third quarter.

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q2 2024

Historical avgQ2 2024

+1.0%

Avg return

Earnings day

+0.3%

Avg return

5 days after

+1.5%

Avg return

30 days after

58%

33 / 57 earnings

Positive

+15.5%

Q2 2022

Best reaction

-26.4%

Q1 2024

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026+0.0%-11.1%-8.3%
Q4 2025-17.9%-23.2%-18.0%
Q3 2025+4.4%+12.0%+26.5%
Q1 2025+12.9%+17.4%+11.9%
Q4 2024-12.8%-18.4%-32.1%
Q3 2024+15.2%+21.2%+21.1%
Q2 2024-7.2%-5.4%-1.6%
Q1 2024-26.4%-24.9%-29.0%
Q4 2023+12.2%+7.1%+7.5%
Q3 2023+11.1%+12.9%+19.5%
Q2 2023+4.3%+2.8%+9.1%
Q1 2023-14.3%-14.1%-4.0%
Q4 2022-7.7%-11.8%-23.7%
Q3 2022-4.4%-2.2%+13.1%
Q2 2022+15.5%+13.4%+11.4%
Q1 2022+11.0%+2.2%+6.3%
Q4 2021-1.6%-5.0%-34.6%
Q3 2021+3.7%+5.5%-12.2%
Q2 2021+5.1%+6.2%+13.1%
Q1 2021-0.2%-1.6%+4.6%
Q4 2020-4.0%-5.1%-3.1%
Q3 2020+4.1%-4.9%-1.2%
Q2 2020+1.3%+0.6%+7.5%
Q1 2020+0.1%-0.8%+6.8%
Q4 2019-3.6%-9.6%-30.0%
Q3 2019+6.1%+11.9%+17.7%
Q2 2019+3.8%+5.5%+7.3%
Q1 2019+0.4%-1.2%+3.7%
Q4 2018+3.4%+4.1%+13.3%
Q3 2018+5.7%+4.6%+9.0%
Q2 2018-4.9%-0.2%+8.7%
Q1 2018+9.6%+7.4%+6.8%
Q4 2017+1.4%+0.7%+6.1%
Q3 2017+10.0%+11.2%+9.3%
Q2 2017-1.3%-3.2%-2.9%
Q1 2017+3.5%+3.7%+10.0%
Q4 2016+4.3%+7.1%+7.7%
Q3 2016-1.6%+1.6%+1.2%
Q2 2016-5.0%-4.9%+0.8%
Q1 2016+0.5%
Q4 2015+8.7%
Q3 2015-8.9%
Q2 2015-5.0%
Q1 2015-0.8%
Q4 2014+6.9%
Q3 2014-2.4%
Q2 2014+5.1%
Q1 2014+6.3%
Q4 2013-7.6%
Q3 2013-1.5%
Q2 2013+7.1%
Q1 2013-0.1%
Q4 2012+4.4%
Q3 2012+8.1%
Q2 2012+4.4%
Q1 2012-11.8%
Q4 2011+8.0%
Q3 2011
Q2 2011
Q1 2011
Q4 2010
Q3 2010
Q2 2010
Q1 2010

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