NYSE$EPAM

EPAM Systems Inc. · Q4 2022 earnings

Q4 2022 earnings · · Investor relations

Briefing

EPAM demonstrated strong financial performance despite challenges, with revenue increasing and strategic investments made for future growth.

EPAM Systems reported Q4 2022 revenues of $1.231 billion, an 11.2% year-over-year increase. GAAP diluted EPS was $2.61, up 8.7% year-over-year, and non-GAAP diluted EPS was $2.93, up 6.2% year-over-year. The company's Board of Directors approved a share repurchase program with authorization to purchase up to $500 million of EPAM common stock.

  • Revenues reached $1.231 billion, reflecting an 11.2% increase year-over-year.
  • GAAP income from operations was 13.8% of revenues, while non-GAAP income from operations was 17.8% of revenues.
  • GAAP diluted EPS increased by 8.7% to $2.61, and non-GAAP diluted EPS increased by 6.2% to $2.93.
  • A share repurchase program was approved, authorizing the purchase of up to $500 million of EPAM common stock.

Headline financials

Total Revenue

$1.23B

Previous: $1.11B+11.2%
EPS (adj)

$2.93

Previous: $2.76+6.2%
Operating Margin

13.8%

Previous: 15.0%-8.0%
Non-GAAP Operating Margin

17.8%

Previous: 18.6%-4.3%
Capital Expenditures

$21.5M

Previous: $56.6M-62.0%
Free Cash Flow

$165M

Previous: $228M-27.8%
Net Income

$155M

Previous: $142M+9.0%
Operating Income

$170M

Previous: $166M+2.9%
Gross Profit

$399M

Previous: $380M+4.8%
Cash & Equivalents

$1.68B

Previous: $1.45B+16.2%
Total Assets

$4.01B

Previous: $3.52B+13.8%
Stock-Based Comp

$31.6M

Previous: $34M-7.1%

Revenue & EPS history

EPAM · Revenue · Quarterly

$1.23B

Q4 2022+11.2%vs Q4 2021
Beat estimate in 13 of 15 quarters(87%)
ActualEstimate

Forward guidance

EPAM provided guidance for the full year and first quarter of 2023, including revenue expectations and GAAP and non-GAAP income from operations.

Tailwinds

  • Full year revenue is expected to be at least $5.250 billion, reflecting a year-over-year growth rate of at least 9%.
  • Full year GAAP income from operations is expected to be in the range of 11.5% to 12.5% of revenues.
  • Full year non-GAAP income from operations is expected to be in the range of 15.5% to 16.5% of revenues.
  • Full year GAAP diluted EPS is expected to be in the range of $8.64 to $8.84.
  • Full year non-GAAP diluted EPS is expected to be in the range of $11.15 to $11.35.

Headwinds

  • Revenue growth will be negatively impacted by approximately 2% as a result of the decision to exit the Russian market.
  • First quarter revenue growth includes an unfavorable foreign currency translation impact of approximately 2%.
  • Revenue growth will be negatively impacted by approximately 3% as a result of the decision to exit the Russian market.
  • For the first quarter, EPAM expects GAAP income from operations to be in the range of 9.5% to 10.5% of revenues.
  • For the first quarter, EPAM expects non-GAAP income from operations to be in the range of 14.0% to 15.0% of revenues.

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 Q4 2022

Historical avgQ4 2022

+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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