EXLS · ExlService Holdings, Inc.

ExlService Holdings delivered a robust Q2 2026, with revenue of $594.8M (+15.6% YoY) driven by broad-based segment growth and strong AI adoption tailwinds. Healthcare & Life Sciences led at $158.0M, reflecting 22% YoY expansion, while Insurance ($197.8M) and Banking ($133.9M) also grew double digits. GAAP operating margin contracted slightly to 14.7% from 15.8% a year ago, but adjusted operating margin improved to 19.7% (up 10 bps), demonstrating operating leverage despite higher stock-based compensation and acquisition-related costs. Adjusted diluted EPS surged 22.3% to $0.59, outpacing GAAP EPS of $0.42 due to add-backs for stock comp and intangibles. Management highlighted strong execution of its data and AI strategy, with new client wins (17 in the quarter) and strategic partnerships with Databricks, OpenAI, and Anthropic. The pending iMerit acquisition, expected to close on July 31, 2026, is set to add foundation model expertise. Guidance was raised materially: full-year 2026 revenue now $2.390B-$2.415B (14-16% reported growth) including iMerit, and adjusted EPS of $2.25-$2.29 (16-18% YoY). The organic constant currency growth forecast was increased to 13-14% from 10-12%, reflecting confidence in pipeline and momentum. Balance sheet remains healthy with $284M in cash and short-term investments and manageable leverage ($381M current portion of borrowings). No capital return activity was announced. The guidance upgrade underscores sustained demand for AI-driven transformation services, positioning EXL for a strong finish to 2026.