Good day, and thank you for joining us. Welcome to the Concentrix Second Quarter Financial Results Conference Call. I would now like to hand it over to Sara Buda, Vice President of Investor Relations. Please proceed.

Great. Thank you, operator, and good evening. Welcome to the Concentrix Second Quarter 2025 Earnings Call. This call is the property of Concentrix and may not be recorded or rebroadcast without the written permission of Concentrix. This call contains forward-looking statements that address our future performance and that by their nature, address matters that are uncertain. These uncertainties may cause our actual future results to be materially different from those expressed in our forward-looking statements. We do not undertake to update our forward-looking statements as a result of new information or future expectations, events, or developments. Please refer to today's earnings release and our most recent filings with the SEC for additional information regarding uncertainties that could affect our future financial results. This includes the risk factors provided in our annual report on Form 10-K and other public filings with the SEC. Also during the call, we will discuss non-GAAP financial measures, including adjusted free cash flow, non-GAAP operating income, non-GAAP operating margin, adjusted EBITDA, adjusted EBITDA margin, non-GAAP net income, non-GAAP EPS, and constant currency revenue growth. A reconciliation of these non-GAAP measures is available in the news release and on the company's Investor Relations website under Financials. With me on the call today are Chris Caldwell, our President and CEO; and Andre Valentine, our Chief Financial Officer. Chris will provide a summary of our operating performance and growth strategy, and Andre will cover our financial results and business outlook. Then we'll open up the call for your questions. And now I'll turn the call over to Chris.

Thank you very much, Sara. Hello, everyone, and thank you for joining us today for our second quarter 2025 earnings call. We are seeing momentum from the investments we have been making, accelerating our growth rate and demonstrating the value of our differentiated offerings. Today, I'll give you a bit more detail on our progress, and then Andre will talk about our view of ongoing revenue, margin, and cash flow growth in the second half of the year. Now let's start with the quarter. We reported yet another solid revenue quarter above our guidance, which outpaced both in our core offerings and our adjacent solutions. We saw growth in our pipeline across verticals and geographies with the desired mix of services and accretive margin profiles. Operational margins for the quarter were lighter than anticipated, driven by two reasons: our decision to hold labor in April while clients reacted to tariffs and temporarily paused projects; and two, preparing for accelerated growth in the second half we won in quarter. As anticipated, by the end of May, we exited the month with our margin trending more favorably and expect that by later in Q3, we will again see improvement year-over-year in our margin. The goodwill we have seen from clients because of our decisions has already produced benefits. We also delivered over $200 million in adjusted free cash flow in the quarter. As you can see from our outlook, we are excited about our second half momentum across all metrics, as Andre will detail. We are outperforming due to a few primary factors. First, our strategy to deliver pragmatic, deployable AI solutions aligned with what clients want is working. This is being driven both by embracing third-party technology partners as well as our own iX suite of products. Clients are over the AI hype and want practical solutions. Our Gartner study recently revealed that enterprises are adopting a digital-first, but not digital-only approach. And our own third-party survey of 450 global enterprises showed a similar sentiment, revealing that 85% of these enterprises expect to increase their outsourcing budget over the next 2 to 3 years. The majority of that increase is expected to be net new investments in supporting their AI agenda. Further, even though the survey was completely blind and independent, enterprises' selection of Concentrix as a partner to build and deploy their AI initiatives was significantly ahead of all other traditional CX companies combined, and it was even higher than many IT services companies. This is clear third-party validation of our recognition as a technology solutions provider in the marketplace. Over the past 18 months, we have made thoughtful investments in our technology and our teams to position ourselves for this exact moment. In Q2, we also launched iX Hero, our Agentic AI-powered application that gives humans superpowers to more accurately and efficiently complete tasks with more consistent outcomes. This complements our autonomous AIS system product, iX Hello, giving clients an array of AI solutions to meet their needs for both full automation and human augmentation. We are delighted with the early market traction we are gaining, and our pipeline of integrated product solutions deals is strong. We believe we are on track for our products to be accretive to the business as we exit the end of the year and believe we can deliver accelerated levels of revenue growth for our products without increasing our spend this year. Within our marketplace, we are also winning on the side of partner consolidation. This is enabling us to grow and win new business that tends to have more complexity as we introduce new adjacent services that can be deployed securely and at scale. In summary, we delivered another strong revenue and cash flow quarter and are on track to exceed our revenue forecast for the year. We are confident that the strategy we implemented several years ago is working. This strategy centered around: one, bringing integrated technology-led solutions to market that align with clients' needs; and two, expanding the value we provide clients across a broader portfolio of business solutions to grow share; and finally, three, keeping our underlying business healthy by automating or divesting in commodity work. The market is evolving as we anticipated. Clients are centralizing spend with partners that have scale, breadth, and expertise to deliver real-world solutions that drive tangible results. We are well-positioned against our competitor set particularly for large-scale programs that combine consulting, IT integration, CX expertise, and AI. We have made and will continue to make the right investments in the business for ongoing profitability. I would like to thank our game changers for their passion this quarter and the clients for their trust. And with that, Andre, I'll turn it over to you.

Well, thank you, Chris. In the second quarter, we exceeded our revenue guidance yet again, delivering revenue of approximately $2.4 billion, an increase of 1.5% year-on-year on both a constant currency and as-reported basis. The growth in the quarter was broad-based across our client base and reflects continued strength in our core AI-led customer experience offerings and ongoing growth in our adjacent AI solutions. These adjacent services are growing at a rate that is faster than the company as a whole, and we continue to believe that as these solutions increase in scale, there is an increasing opportunity for them to contribute to revenue growth. Looking at our second quarter revenue growth by vertical. On a constant currency basis, growth was well balanced across verticals. Revenue from retail, travel, and e-commerce clients grew 3% year-on-year, led by growth with travel clients. Media and communications also grew 3% year-on-year this quarter. This is positive to see as this vertical has been flat to down in the past few years. Revenue from banking, financial services, and insurance clients grew 2%, and our tech vertical and our health care vertical were both relatively flat, reflecting offshore movement. Turning to profitability. Our non-GAAP operating income was $304 million. This is below the guidance range we provided on our last call. As Chris mentioned, in April, some clients paused programs as they sorted through the impact of tariffs on their business. During this time, we kept their program stable with the expectation that the programs will start to resume in May, as they have. We also made elevated investments to support the acceleration of revenue growth in the second half of 2025. Margins improved in May, and we expect meaningful sequential margin improvement in both the third and fourth quarter of the year. Adjusted EBITDA in the quarter was $357 million, a margin of 14.8%. Non-GAAP diluted EPS was $2.70 per share within our guidance range and an increase of $0.01 year-on-year as we benefit from lower interest expense, a more favorable tax rate, and a lower share count as we continue to repurchase our shares. GAAP net income was $42 million for the quarter and GAAP diluted EPS was $0.63 per share. Reconciliations for GAAP and non-GAAP measures are provided in today's earnings release. Adjusted free cash flow was $200 million in the quarter, an improvement of about $240 million sequentially from Q1. We returned approximately $67 million to shareholders in the quarter, which included repurchasing $45 million of our common shares or approximately 920,000 shares at an average price of approximately $49 per share. The remaining $22 million in shareholder return was in the form of our quarterly dividend. At the end of the second quarter, cash and cash equivalents were $343 million and total debt was approximately $4.9 billion, bringing our net debt to $4.5 billion. We also reduced the amount of our off-balance sheet factored accounts receivable with the balance standing at approximately $142 million at the end of the quarter. As previously disclosed, we refinanced a portion of our debt maturities and extended our revolving credit facility on favorable terms in the quarter. Late in the quarter, we made a $150 million voluntary principal payment against our term loan that matures in December of 2026, bringing the balance on that term loan down to $600 million. At the end of the quarter, we had approximately $1.5 billion in liquidity including our $1.1 billion revolver, which is undrawn. Overall, we delivered a strong revenue quarter above expectations with steady growth across verticals. We continue to complement our core CX growth with strong momentum from our adjacent solutions, such as data annotation, analytics, B2B sales, and AI implementation IT solutions. Our pipeline is strong, and the new business we are signing is accretive to margins as these programs scale. Now I will turn to our outlook. For the third quarter, we expect the following: revenue of $2.445 billion to $2.470 billion. Based on current exchange rates, these expectations assume an approximate 140 basis point positive impact of foreign exchange rates compared with the prior year period. The guidance implies constant currency revenue growth for the quarter ranging from 1% to 2%. We expect operating income of $162 million to $172 million and non-GAAP operating income of $318 million to $328 million. This translates into expected non-GAAP EPS of $2.80 per share to $2.91 per share, assuming approximately $68 million in non-GAAP interest expense, 62.7 million diluted common shares outstanding, and approximately 5% of net income attributable to participating securities. The effective tax rate is expected to be approximately 25.5% in the quarter. Our guidance for the full year 2025 is as follows: fiscal year reported revenue of $9.720 billion to $9.815 billion based on current exchange rates which assumes a minimal impact of foreign exchange rate compared with the prior year period. Accordingly, we are increasing our guidance for constant currency revenue growth for the full year to 1% to 2%. We expect operating income of $675 million to $695 million and non-GAAP operating income of $1.300 billion to $1.320 billion. This is within our initial profit guidance for the year and adjusts for the results in Q2 and a currency headwind to profit as compared to our initial guidance. We do expect our non-GAAP profit margin to increase sequentially in both the third and fourth quarters as revenue follows the upfront investments we've made and as our technology suite moves to being accretive to the business in the fourth quarter. Our guidance for non-GAAP EPS is $11.53 to $11.76 per share, assuming non-GAAP interest expense of $273 million, approximately 63.1 million diluted common shares outstanding, and approximately 5% of net income attributable to participating securities. The effective tax rate is expected to be approximately 25% for the full year. And finally, we continue to expect adjusted free cash flow of $625 million to $650 million. Included in this expectation is an improvement in days sales outstanding from current levels, and the expected sequential improvement in profitability and lower integration costs. In regard to capital allocation priorities, as we said in January, we expect our spending on share repurchases to modestly exceed last year, taking advantage of the disconnect between the fundamentals of our business and our current valuation while continuing to pay down debt. We remain committed to maintaining our investment-grade principles. And of course, we will continue to support our dividend, which currently has a yield of approximately 2.4%. In summary, we are seeing a steady acceleration in our growth rate and are confident that our strategy to differentiate Concentrix in the market will continue to drive stronger growth in the second half of 2025 and beyond. We expect margin improvement in the second half and are committed to driving strong year-on-year free cash flow growth. We have made the right investments in the business that are allowing us to outperform and over the long term, position us to generate mid-single-digit growth, we believe this business can deliver. And we are committed to having the right capital structure and continued capital return through a combination of share repurchases and dividends, while reducing our leverage. With that, operator, please now open the line for questions.

And the first question will come from Joseph Vafi of Canaccord.

Great to see another solid quarter here relative to expectations. Congratulations on that. I have a few quick questions. It seems that some of the weaker verticals are improving, and I know you're anticipating some revenue acceleration in the second half. I wanted to explore that further. Is the revenue acceleration broad-based, or is it primarily dependent on a few specific contracts? Additionally, I'd appreciate any insights on where this might be coming from on a vertical basis. I will have a quick follow-up after that.

For sure, Joe. It's Chris. So the momentum is broad-based. As we talked about from a pipeline perspective, we're seeing very solid pipeline building not only from a geography perspective in all of our geographies but also on a vertical perspective. I think banking, as Andre alluded to, tech, and media and comms, we're starting to see some good momentum. Health care, we're starting to get to the end of the offshoring mutation or muting of our growth. And so we're really excited about what we're seeing. And frankly, as we kind of indicated in our comments, the type of deals that we're winning and the solutions that we're winning are the types that we've been after. They're much more stickier, they're more complex, and a big chunk of them use our technology. So we're pretty happy with that.

That's great. Congratulations on receiving market research recognition for your technology. Where are we in this journey now? I think Concentrix has done an excellent job in turning AI into a clear advantage from an unknown over the last year and a half. I know you're launching some stand-alone software products that seem to be helping you gain market share. Could you provide more detailed commentary on how AI is currently performing for you in the market and what we should expect over the next year?

Yes, for sure, Joe. So I'll tackle the question in two parts. The first part is really our own technology. As we talked about sort of two years ago, not frankly many clients were buying real AI. And so we developed a suite of products internally ourselves and are starting to see some very strong benefits. And then the middle of last year, our clients started talking about wanting to deploy what we had basically been showing them internally working. And so that's where we started to commercialize the product and launch the first fully autonomous product late last year. And then the, I'll call it, human augmentation product, iX Hero at the beginning of Q2. What we've been super happy with is not only are we getting clients to think about how to use it internally and are adopting it at sort of a little ahead of where we expected them to adopt it. But also from the size of deployment, we're very happy that we're starting to see some scale. The one thing that we are seeing is the economic model is slightly different than what we expected. We're seeing clients willing to give us more work because of our platform, which we are obviously costing into that, and we're getting economic return from, but it's not necessarily always turning into discrete billing. We are also growing our discrete billing though when a client is deploying it across their enterprise or wants to split how they're buying products and services from us. And so we're super, super happy with how that is going. As we talked about, our expectation is that we'll be accretive by the end of Q4. And as I also mentioned, we expect to be able to accelerate growth on those products without investing more at this rate because we built sort of and took the time to build it into a commercial product at the beginning of the year. So as painful as it was at the beginning of the year, we're starting to see the benefits of that investment and that time taken to build it that way. The second part of the AI discussion is really about our third-party technology partners and our adjacent services. The third technology partners are really coming to us because they've got this technology and they don't understand how to implement it in the last mile that drives value for clients. Many of them had failed POCs or where they can't get growth out of it, and they're coming to us and say, how do we actually implement this and use it and working with the clients to do that. So we're seeing good growth in those implementation services. We're seeing good growth in the pipeline, and we're also selling services around that from a delivery perspective. And then from an adjacent services perspective, the growth in our data annotation, our analytics business, our implementations business, our consulting, our managed services business, and even our B2B business, where we're actually selling AI solutions on behalf of software vendors, as we talked about a quarter or two ago, is now getting to $1 billion and growing much faster than our core business. And so we're seeing all these positives from this AI as we talked about two years ago, despite a lot of people not necessarily believing us at that time, and we're excited to see where the momentum can take us.

Sure. That's great. A lot of color there. Much appreciated, Chris. Congrats on all the progress you and the whole team.

And the next question will be coming from the line of Robby Bamberger of Baird.

Can you maybe provide just a little bit more color on kind of what happened to margins in Q2 that caused you to be about 80 bps below last guide? And then how much of that was due to that pause from tariffs that you mentioned? And then also how much was due to impacts like FX or anything else that's one-off this quarter?

Sure, Robby. Let me provide some insights into the quarter. March aligned well with our expectations, and our growth and pipeline were strong. When the tariffs were implemented, a small number of our clients in logistics and manufacturing were taken aback by their impact. They needed some time to reassess their projects and determine how to proceed, considering whether their returns would meet expectations and if they needed to adjust their supply chains. We communicated with these key clients, suggesting that while we could reduce labor and pause projects, we anticipated that the tariff situation would resolve, allowing for a quick recovery. This could potentially lead to delays of three to four months and other challenges. Ultimately, we decided to maintain our labor and pause projects to safeguard our ongoing investments. By May, we began to see our margins improving, and as mentioned earlier, we expect them to continue rebounding and to be higher year-on-year by the end of Q3. Importantly, our clients appreciated our approach; their supply chains remained unaffected, and they are now seeking to increase their volume with us as their other partners have scaled back, enabling us to accelerate some planned investments. Regarding our earnings guidance, the midpoint reflects held labor and some successful investments this quarter due to that held labor driving increased volume towards us. Andre, would you like to address the impact of foreign exchange?

Yes, foreign exchange has certainly had mixed effects on us. While it provided more of a positive impact than we anticipated at the top line, it created some challenges regarding our profitability. We saw advantages from the strength of the euro and the pound. However, the decline of the US dollar against the unhedged portions of our exposure to the Philippine peso and Indian rupee affected us. Overall, though, these effects were smaller than the issues Chris mentioned.

Yes. That's very helpful there. And then if we look in the back half, we can imply sort of mildly above 2% organic constant FX growth in H2 after about 1.5% in the first half. I guess what gives you confidence in the mild acceleration there? And then is it partly due to the April revenue volumes kind of being a little bit lower because of those clients essentially pausing spend due to the tariffs? And then Q3 guide implies mildly above that 1% sequential that we've seen sort of the past 3 years. Is that due to the tariff impact?

Yes. I wouldn't read too much into the tariff impact. I'll let Andre kind of go through some of the other comments. But just to be very clear, we started seeing the volume coming back in our expectations by the end of May from the volume that was held off in April from the tariffs and that's layered in. If you think about how we've guided for the last two quarters, we've been quite conservative in coming over our guide. And I think that's still our philosophy from a revenue perspective. And so if you extrapolate that out, you can see that we came over the guide even with this pause. We would have probably come in even more over the guide with this pause. Our expectation is that we're going to continue to perform well and accelerate through the back half of the year.

Yes. I think our confidence, Robby, comes from the new business that we've signed so far this year that is ramping as well as the extra share that we think we've picked up because of the actions we took in the second quarter to gain even more traction with some clients. So very confident in our guide. As Chris has said, we've tried to be very conservative very much focused on coming in at the top end of the range for every period that we've given, which would imply a nice acceleration through the second half.

And our next question will be coming from the line of Ruplu Bhattacharya of Bank of America.

Chris, how should we think about the revenue contribution from iX Hello and iX Hero AI offerings this year and beyond? And since it looks like operating margin guide for the full year is now lower by 40 bps on to 13.4% at the midpoint, are you planning to moderate your spending on AI?

Yes. So a couple of things. First, from a comment perspective, as we mentioned, we're spending about $50 million incrementally, $100 million total on internal tools, but $50 million specifically to our iX suite. And when you look at that, we've talked about in Q4, our expectation is that will be accretive, and we're on plan to do that from an economic value perspective. And we've also said that we can hold our spending as is and continue to accelerate revenue on that. And so honestly, our expectation is that we'll continue going into the next year, not guiding for the next year that we'll see continued margin expansion capabilities with it and also tying into growth by client bundling services and technology with us going into the new year. So from our perspective, we're very happy where we're positioning. We're comfortable with that spend. We don't need to increase our spend to continue to see the benefit and are using sort of generative AI tools internally ourselves to drive better value from our development team. So that is all going very, very, very well. We would not, Ruplu, be investing in these suite of products to get a business that just covers our development costs. We see this as a very strategic initiative. We see this as a very differentiated initiative. Our clients are seeing it that way as well. We're getting some great recognition from a number of different analysts around our AI technology and what we're able to do with it. And so over the coming years, we continue to see it as a benefit by taking the strategy.

Andre, I'd like to follow up a little bit more on operating margins. I mean, like fiscal 2Q operating margins were 80 bps lower than the midpoint of your guidance, but revenue was higher than guidance. So when we look at the guide, it's 50 bps higher sequentially to 13.1%, but just on $40 million higher revenue sequentially at the midpoint. So I think that implies like a sequential incremental margin or something like 46%, which is just the change in operating income over the change in revenue. So I'd like to ask you, like what gives you the confidence that you're going to get that level of margin improvement on just $40 million higher revenue sequentially? And you said margins are trending better now. What are the operating margins trending at currently in the quarter?

Yes. So again, I'll start by reminding you that we're very focused on the higher end of our revenue guidance. Therefore, the additional revenue we aim to achieve in Q3 is certainly above $40 million at the midpoint. We expect to see incremental revenue contributing roughly 20% to 25% of flow through, so you can calculate that to see our expectations. We believe the impact from the tariff pause will mostly be resolved as we progress through this quarter, with most of the benefits being one-time effects. This will lead to improvement as we enter Q3, along with other operational enhancements as we scale our programs. Finally, we are moving towards a more favorable outlook regarding the return on our AI investments. All of these factors contribute to our confidence in reaching the midpoint of our guidance.

Okay. Chris, if I can ask you one more real quick. I mean just looking at the general operating environment, can you talk about how sales cycles are trending? And you said that some customers are trying to move their services offshore. What was the impact on revenues and margins? And can you also talk about the Catalyst business? How should we think about revenue growth there? So if you can just give us these details about the operating environment.

Absolutely. Transformation deals are definitely progressing, and while our pipeline may take longer to develop, it's stable and not decreasing. These deals require more approvals due to the level of investment involved, but we are pleased with our pipeline and win rate. In traditional operations, where we help clients achieve savings through our technology as well as third-party solutions, the sales processes usually take one to two quarters from initiation to closing a deal. Typically, it takes another two quarters for those deals to start generating revenue for us, which has been consistent over time. Clients are seeking something innovative and effective, and we believe we fit that demand well. They also want a service provider that can deliver technology, integration, managed services, and execution, and we are well-positioned to provide that, which is evident in our success. Consequently, our Catalyst business plays a significant role in this success. Catalyst revenue is growing alongside our overall business and is fostering additional growth in other areas that we may not classify directly under Catalyst. Expect to see this more integrated as we move forward. Regarding pricing, particularly from a transformation and complexity standpoint, it's healthy, albeit competitive. We are stepping away from commodity-based offerings that are currently very price-sensitive, opting instead to focus on automated solutions. From the perspective of moving work from onshore to offshore, we see a growth headwind of about 1.5% to 2% as work transitions to lower-cost countries. There is often a duplication of costs for about one to two quarters until margins begin to improve after we move operations offshore, even if initial revenue decreases. This challenge should lessen as most new business is now coming from nearshore and offshore instead of onshore. Lastly, around 7% of our revenue comes from commoditized products, though this number is decreasing and is expected to drop to about 5% by year-end. We anticipate this challenge to diminish moving forward, contributing to expected growth in our business. I apologize for the lengthy response, but I hope that addresses all your questions.

Thank you. One moment for the next question and our next question will be coming from the line of Vincent Colicchio of Barrington Research.

Yes, Chris, it's nice to see additional consolidation benefits for the company. Can you give us some color on how these came about? Why you are benefiting from this trend? And if we have legs here into the second half of the additional consolidation?

Yes. So let me start with the last part of your question first. Yes, we have legs into the next part of the back half of the year, and frankly beyond because we do see this trend of clients as a whole wanting fewer partners and they want partners with broader services so that they can obviously boil it down to fewer partners. Really around consolidation comes to three things. The first thing is being top of the stack rank, operational excellence. And we perform and are always focused on trying to be #1 for our clients and where we are #1 for our clients we tend to win from a consolidation perspective. The second thing that's super important to clients is technology to help them automate and improve their delivery. And with our own IX suite of products as well as with third-party products we tend to do very well from that perspective as well. And then the third thing that's important from a consolidation perspective is scale. Scale not only on a footprint perspective but also on a capabilities perspective. And so if you think about a client dealing with three or four partners, one partner for analytics, one partner for some tech, one partner for a CX, one partner for back office, and yet they can come to Concentrix and we can say, 'Look, we can do all this for you. We can help you with your platforms. We can run it. We're very flexible from a commercial perspective.' That really resonates with these clients and that's where we tend to do very, very well. And across those three pillars, we continue to see lots of ability to execute going over the back half of the year and into 2026. And could you give us some color on managed services? Does that continue to grow and sort of what level are you at in terms of managed services as a percent of the business? Yes, we are seeing growth in managed services, particularly driven by AI. This growth is outpacing our historical performance in managed services because AI requires significant maintenance to maximize its efficiency. Currently, managed services represent a smaller portion of our overall business, particularly within our Catalyst segment, which accounts for 8% of our revenue. Despite its size, managed services are one of the fastest-growing areas in our business, and we anticipate this trend will continue as demand for AI-driven managed services increases.

And the next question will be coming from the line of Divya Goyal of Scotiabank.

So thanks a lot for all the color that you provided here in profitability. Andre and Chris, I wanted to get a little bit more color in terms of the elasticity of your headcount as the revenue potentially continues to grow from an automation standpoint and an offshoring standpoint? And obviously, what happened this quarter where you ended up holding on to a lot of labor and staff despite slight weakness. So help us understand how do you potentially see it trending with increasing automation and AI getting more prominent across the revenues?

For sure, Divya. I appreciate that. The first thing that you should appreciate, and I think you know, because you know the industry well, is that we can lower our cost pretty quickly from a headcount perspective if we need to. And we took a conscious decision in April to keep it based on not only the client relationships and where we saw it as a competitive advantage. But if we had not seen that, we could have exited the labor very, very, very quickly and kind of had a different result. But net-net, economically, we think it was better with what we did. From an elasticity perspective of labor, I'm hesitant to give too much detail because I see people coming out with these things, saying like 40% of our work is done by AI, 90% of our work is done by AI, but they're not decreasing their headcount, which is a little dubious. What we find is that our efficiencies, depending on the role and job that is done, is anywhere from about 5% to 40%. And I know that's quite a large range, but it depends on where we're putting it in, it depends on the task that we're doing it in, and it depends on the skill set of the individual. We are seeing some of that elasticity now. We are using some of that for competitive advantage on getting volume from others because we can be more competitive in the space while still maintaining and growing our margins. We also see that as where we are helping our clients be more cost-efficient, and therefore, they're buying our technology to do that. But long term, we do see our ability to continue to grow our revenue without growing our headcount. And if you look at our headcount numbers for the most part, through the course of the year, they haven't really materially changed yet we've grown our revenue.

That's very helpful. But as of now, given the potential increase in automation and AI you don't see a decline in headcount. Like I'm just wondering from a global employment loss standpoint, right, like that's where my head is at. And I'm thinking about how can we best preempt that situation?

Yes. So Divya, our goal is frankly to keep our headcount flat as we grow revenue and maybe possibly decline headcount depending on our growth of revenue. And clearly, we're going to take advantage of as much automation as we can. I think from our perspective, what we look at is kind of our margin profile of our business is accretive to the complexity of the work that we're dealing with. There is some automation; more will come. And as that comes in, we will take the appropriate action. But right now, we do not see a massive decrease. And in fact, if you look at some of the analyst studies like I think Gartner has come out with it and McKinsey just came out with a report recently, and there was an FT column on it. They all expected employment and outsourcing will actually increase over the next 3 years. So it's an interesting phenomenon and goes in the face of some of what the pure tech companies are saying because they might not necessarily understand the dynamics of how to deliver services around their tech.

That's very helpful. I'll just ask one last question here. You briefly spoke about the shift in pricing dynamics out there. Could you talk to us a little bit more about how exactly are you seeing your pricing strategy evolve? Again, with increasing automation, increasing AI, increasing offshoring, are you seeing a shift from time and material to more outcomes-based pricing? And plus with your iX Hello-like solutions, right? Talk to us a little bit about your pricing strategy and how are you broadly competing with the increasing consolidation in mind as well. And that will be all for me.

No problem, Divya. First, we're not seeing a significant change in the size of our business. However, there is growing interest in outcomes-based pricing and transformational deals that reduce costs. Typically, revenue still comes from a transactional unit multiplied by a revenue unit, and we expect that to slowly evolve, although we've mentioned that for the past decade without much movement. It may take another decade for significant change, and we're still discussing it. Our primary focus is on expanding new revenue streams such as our iX product suite. While some of this is bundled into our services, we also generate discrete revenue similar to software SaaS revenue, which we aim to grow. Additionally, we have managed services contracts, where we charge a fixed fee for the entire year while managing the relevant equipment and services, creating a different revenue flow. However, these various revenue streams currently make up less than half of our revenue. To manage expectations, while the margin profile is promising and we definitely want to see growth, we don't anticipate these streams surpassing half of our revenue in the foreseeable future.

Thank you. There are no more questions in the queue. And at this time, this does conclude the conference call for today. You may all disconnect, and have a great evening.