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    David Grossman • Stifel

    David Grossman's questions to Epam Systems Inc (EPAM) leadership

    David Grossman's questions to Epam Systems Inc (EPAM) leadership • Q2 2025

    Question

    David Grossman of Stifel Financial Corp. asked if the Q4 margin exit rate would be a good baseline for the following year and about the current pricing-wage dynamic. He also questioned the narrative of AI's impact on revenue, seeking insights into the risks and opportunities versus market perception.

    Answer

    CFO Jason Peterson advised against using the seasonal Q4 as a baseline, pointing to the full-year guidance, and noted the pricing environment feels better than six months ago. CEO Arkadiy Dobkin addressed AI fears, stating that the increasing complexity of AI-enabled enterprise systems will drive greater demand for high-quality engineers. He highlighted a trend of clients returning to EPAM after attempting complex AI projects themselves.

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    David Grossman's questions to Epam Systems Inc (EPAM) leadership • Q1 2025

    Question

    David Grossman asked about growth dynamics outside the top 20 clients, the trend of clients returning to EPAM, and the maturity of the India delivery center.

    Answer

    CEO Arkadiy Dobkin confirmed that the trend of clients returning is visible and accumulating. CFO Jason Peterson noted growth outside the top 20 is partly driven by M&A and new logos. Regarding India, Dobkin explained that while its maturity is growing, its talent pyramid differs from established locations, and it now represents nearly 20% of EPAM's capacity.

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    David Grossman's questions to Epam Systems Inc (EPAM) leadership • Q4 2024

    Question

    David Grossman inquired about EPAM's capacity to accelerate growth as demand improves, the potential revenue headwind from geographic mix shifts in 2025, and whether there are unique factors driving its margin compression compared to peers.

    Answer

    CFO Jason Peterson expressed confidence in the company's ability to scale talent across its global delivery locations. He acknowledged a continued, though perhaps lessening, headwind on revenue per headcount from the mix shift to lower-cost regions. On margins, Peterson and CEO Arkadiy Dobkin attributed the pressure to strategic investments in retaining high-quality talent for complex 'change the business' work, which they believe is a larger part of their mix than for many peers, in a challenging pricing environment.

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    David Grossman's questions to Epam Systems Inc (EPAM) leadership • Q3 2024

    Question

    David Grossman of Stifel asked for a distinction between macro-driven demand improvement versus clients getting comfortable with EPAM's diversified delivery. He also sought explicit clarification on the 2025 margin outlook and questioned the sequential growth in non-production headcount.

    Answer

    CEO Arkadiy Dobkin found it difficult to quantify the demand drivers but noted clients are increasingly investing in data and cloud infrastructure to prepare for future tech benefits. CFO Jason Peterson added that some clients are returning due to quality issues with other vendors. Peterson explicitly confirmed that his guidance for 2025 margins to be 'slightly below 16%' is inclusive of the expected Poland R&D benefit. He also corrected the headcount premise, stating production headcount saw the majority of the increase.

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    David Grossman's questions to Exlservice Holdings Inc (EXLS) leadership

    David Grossman's questions to Exlservice Holdings Inc (EXLS) leadership • Q2 2025

    Question

    David Grossman questioned the guidance architecture, which implies a back-half EPS decline, the dynamic of revenue outpacing headcount, a competitor's acquisition, and new client additions.

    Answer

    EVP & CFO Maurizio Nicolelli explained that after a strong first half, the company will increase investments in Data & AI in the second half to drive future growth, impacting short-term EPS. Chairman & CEO Rohit Kapoor addressed the competitive landscape by stating the market is large enough that a single acquisition has no material impact. He also pointed to strong double-digit pipeline growth as a better indicator of demand than the number of new client adds in a single period.

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    David Grossman's questions to Exlservice Holdings Inc (EXLS) leadership • Q1 2025

    Question

    David Grossman questioned the growth deceleration in the Insurance vertical and asked for management's outlook, noting a similar trend from a competitor. He also sought deeper insight into the potential deflationary impact of deploying AI on the existing book of business and how efficiency gains are shared with clients.

    Answer

    Rohit Kapoor, Chairman and Chief Executive Officer, explained that the Q1 slowdown in Insurance was a timing issue and expects the vertical to grow in line with the overall company for the full year. Regarding AI's impact, he argued that proactively cannibalizing revenue to deliver value actually accelerates overall growth by building client trust. He characterized the adoption of AI into the installed base as a gradual, multi-year journey still in its early phases. Maurizio Nicolelli, CFO, added that FX contributed about $5 million to the revenue guidance increase.

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    David Grossman's questions to Exlservice Holdings Inc (EXLS) leadership • Q4 2024

    Question

    David Grossman asked for a deeper explanation of the fundamental business reasons motivating the operating model change. He also inquired about how Generative AI is impacting service delivery beyond code conversion, its pervasiveness, and its expected financial impact on revenue growth and margins.

    Answer

    Rohit Kapoor, Chairman and CEO, explained the operating model change was driven by the maturity of the analytics business and a strategic need to get closer to clients, focus on international markets, and better execute on cross-selling and large integrated deals. He stated that Gen AI is a tailwind to revenue, expanding the size of engagements and access to new buying centers like the CIO. This is evidenced by the 18% year-over-year growth in the Digital Operations business in Q4.

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    David Grossman's questions to Exlservice Holdings Inc (EXLS) leadership • Q3 2024

    Question

    David Grossman requested more detail on the growth drivers within the Digital Ops business, the revenue model for stand-alone digital solutions, and an explanation for the quarter-to-quarter volatility in EBIT margins.

    Answer

    CEO Rohit Kapoor detailed that Digital Ops growth comes from both stand-alone digital solutions (sold as licensed tools with implementation services) and digital capabilities embedded into operations workflows. CFO Maurizio Nicolelli addressed margin volatility, explaining that while quarterly figures fluctuate due to investment timing, the company manages for marginal, incremental AOPM expansion on an annual basis and investors should focus on the annual trajectory rather than quarterly shifts.

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    David Grossman's questions to TriNet Group Inc (TNET) leadership

    David Grossman's questions to TriNet Group Inc (TNET) leadership • Q2 2025

    Question

    David Grossman asked for a review of major year-over-year comparison dynamics for the second half, progress in the broker channel, and more color on the drivers of CIE growth. He also followed up to ask if the outsized claims were related to the Change Healthcare disruption.

    Answer

    EVP & CFO Kelly Tuminelli and President & CEO Mike Simonds reviewed the back-half outlook, noting WSEs are expected to be down but that execution on pricing and retention is on track. Simonds stated he 'fully expects' the broker channel to be additive in H2 2025, with proposal volume already increasing. Tuminelli clarified that the CIE beat was driven more by fewer layoffs than by seasonal hiring. She also confirmed that an investigation found no evidence linking the outsized claims to the Change Healthcare situation, viewing it as an isolated anomaly.

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    David Grossman's questions to TriNet Group Inc (TNET) leadership • Q1 2025

    Question

    David Grossman questioned if the multi-year plan to reprice the underperforming healthcare book could be accelerated. He also asked for more details on the new benefit bundles and their expected impact, and inquired about the size of the Main Street vertical.

    Answer

    President and CEO Michael Simonds responded that the repricing plan remains on a similar multi-year track, balancing retention with achieving appropriate pricing, noting that attritted clients had a significantly higher insurance cost ratio. He explained that the new benefit bundles will simplify plan choices for clients and streamline the sales process, which could improve sales velocity. CFO Kelly Tuminelli clarified that the Main Street vertical represents roughly 20% of PEO worksite employees.

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    David Grossman's questions to TriNet Group Inc (TNET) leadership • Q4 2024

    Question

    David Grossman questioned the long-term potential for TriNet's WSE growth to match peers with different business models. He also asked for details on the strategy to penetrate the benefits broker channel, its current contribution to sales, and the potential financial impact of the ASO model if it gains traction.

    Answer

    CEO Michael Simonds stated he sees no structural reason for TriNet's long-term WSE growth to lag the industry, citing plans to mature the direct sales force and expand the broker channel. He revealed the broker channel already contributes 'well into the double digits' of new business and will be enhanced with new technology. Regarding the ASO model, Simonds positioned it as part of a flexible continuum of high-value HR outsourcing services, viewing it as a potentially exciting growth area for the company.

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    David Grossman's questions to TriNet Group Inc (TNET) leadership • Q3 2024

    Question

    David Grossman of Stifel asked about competitive dynamics for an at-risk PEO, the timing of pricing for October renewals, the impact of a one-time item on Q4 revenue, and the expected workers' comp headwind in 2025.

    Answer

    CEO Mike Simonds expressed confidence that TriNet's at-risk model and enhanced risk management can be a long-term competitive advantage. CFO Kelly Tuminelli confirmed that October renewal pricing was set in early July with adequate data to implement a double-digit increase. She also reiterated the $8 million non-recurring item impacting Q4 professional services revenue and noted that favorable 2024 workers' comp reserve adjustments are not expected to recur in 2025.

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    David Grossman's questions to DocGo Inc (DCGO) leadership

    David Grossman's questions to DocGo Inc (DCGO) leadership • Q4 2024

    Question

    Aidan Conniff, on behalf of David Grossman, asked for additional detail on the assumptions for total operating expenses for 2025. He also inquired about the expected conversion rate of the sales pipeline throughout the year.

    Answer

    CFO Norman Rosenberg projected full-year 2025 gross margins to be around 35%. To achieve the mid-single-digit EBITDA margin target, this implies SG&A will average around 30% of revenue for the year, a significant improvement from the 39.7% in Q4 2024. CEO Lee Bienstock added that pipeline conversion varies by vertical: payer deals tend to cluster at year-end, hospital system deals are more consistent, and the "Project Prime" initiative is designed to smooth out the historically lumpy municipal contract cycle.

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