GLOB · Globant S.A.

Globant delivered Q1 2026 results that exceeded the high end of revenue guidance at $607.1 million, despite a modest 0.7% year-over-year decline, driven by growth from top clients and record Revenue Per Head levels as highlighted by CFO Juan Urthiague. The company is pivoting toward AI-native tech services, with AI Pods ARR reaching $32.8 million as of March 2026, positioning it to collapse boundaries between software and services amid market shifts to deep AI implementation, per CEO Martín Migoya. Margin pressures were evident with IFRS gross margin contracting to 34.5% from 34.9% and Non-IFRS adjusted gross margin to 37.0% from 38.0%, yet operating leverage improved as IFRS profit from operations margin expanded to 8.5% from 8.2%. Earnings strength was clear in IFRS diluted EPS of $0.85, up from $0.68, while Non-IFRS adjusted EPS held steady at $1.50. Balance sheet remains solid with $200.5 million in cash and equivalents, supporting $36.1 million in free cash flow generation. Having invested $50 million in the prior buyback program with $25 million remaining as of quarter-end, Globant announced a new $125 million share repurchase plan to return value to shareholders. Geographic revenue mix showed 53.5% from North America (US top), 20.5% Latin America (Argentina top), 19.7% Europe (Spain top), and 6.3% New Markets (Saudi Arabia top), with top customer at 8.9% of revenues. Guidance signals stability: Q2 revenues $610-616 million (0.7% decline to 0.3% growth YoY, +100bps FX tailwind), Non-IFRS op margin 14-15%, adjusted EPS $1.45-1.55; FY2026 revenues $2,462-2,508 million (0.3-2.2% growth), op margin 14-15%, adjusted EPS $6.10-6.50. This disciplined execution amid AI focus underscores resilience and capital return priority for investors.