EPAM Systems Surpasses Forecasts with Strong Q1 Performance
EPAM Systems (EPAM.N) has exceeded expectations in the first quarter, projecting a revenue range of $1.16 billion to $1.17 billion, surpassing the consensus estimate of $1.15 billion. The Pennsylvania-based company attributes this success to the increasing demand for its software services, particularly in the realm of AI-linked applications.
The growing trend of businesses developing their AI capabilities has proven advantageous for service providers like EPAM Systems, known for their expertise in AI product deployment. In a parallel trend, Freshworks (FRSH.O) also exceeded Wall Street estimates for fourth-quarter revenue, driven by a notable uptick in demand for its AI-powered customer support and IT services products.
The global landscape of IT spending is poised for a 6.8% growth in 2024, fueled by heightened investments from organizations strategically planning their adoption of generative AI. This broader industry momentum has significantly contributed to the positive outlook for companies such as EPAM Systems.
Looking ahead to the first quarter, EPAM anticipates adjusted profits in the range of $2.26 to $2.34 per share, slightly below the estimated figure of $2.39. Projecting into 2024, the company foresees revenue growth of 1%-4%, aligning with analysts’ expectations averaging around 3.6%.
In terms of financial performance reported fourth-quarter revenue of $1.16 billion, exceeding Street estimates of $1.14 billion. Additionally, the company posted an adjusted profit of $2.75 per share for the quarter ending Dec. 31, surpassing analysts’ projections of $2.50. These robust financial results underscore resilience and success in the competitive software engineering and product development service sector.
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