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IL

IBEX Ltd (IBEX)·Q4 2025 Earnings Summary

Executive Summary

  • Record quarter: revenue $147.1M (+18.2% y/y, +4.6% q/q), adjusted EPS $0.87 (+50% y/y); both beat S&P Global consensus materially (rev $132.9M*, EPS $0.70*) as IBEX gained share in embedded clients and scaled AI solutions . S&P Global values marked with * [Values retrieved from S&P Global].
  • Profit mix improving: digital/omnichannel reached 82% of revenue and offshore grew to 49%, supporting strong gross margin (31.4%) despite higher SG&A and modest y/y EBITDA margin compression (-50 bps) .
  • Guidance introduced for FY26: revenue $590–$610M; adjusted EBITDA $75–$79M; Q1 FY26 revenue $143–$146M, adjusted EBITDA $17.5–$19M; FY25 actuals exceeded the high end of prior revenue and EBITDA guidance .
  • Stock catalysts: clear beat on revenue/adjusted EPS versus consensus, record free cash flow ($22.8M), and “proof-of-concept to full-scale” AI deployments set expectations for continued share gains and estimate revisions higher near term .

What Went Well and What Went Wrong

  • What Went Well

    • Top-line acceleration: “Revenue of $147.1 million, an increase of 18.2%… our highest rate in eleven quarters,” with strength in Retail & E‑commerce (+24.5%), HealthTech (+19.0%), and Travel/Transportation/Logistics (+10.0%) .
    • AI scaled from pilots to production: “This quarter marked the shift from proof of concept for our AI solutions to full scale deployments, setting the table for future growth” — CEO .
    • Mix tailwinds: digital/omnichannel 82% (vs 77% p/y), offshore 49% of revenue, gross margin ~31.4%; record quarterly free cash flow of $22.8M .

  • What Went Wrong

    • Margin pressure: Adjusted EBITDA margin 13.9% vs 14.4% p/y on higher SG&A (payroll, impairments, FX losses) even as dollars grew to $20.5M .
    • GAAP net margin contracted to 6.5% (−140 bps y/y); GAAP diluted EPS down q/q ($0.66 vs $0.73), partially offset by lower share count .
    • FinTech softness: FinTech revenue mix declined to 10.6% from 13.7% p/y; management expects stabilization but it’s a watch item .

Financial Results

Headline P&L vs prior periods and estimates

MetricQ4 2024Q3 2025Q4 2025 ActualS&P Global Consensus (Q4 2025)*
Revenue ($M)$124.5 $140.7 $147.1 $132.9*
Diluted EPS (GAAP)$0.56 $0.73 $0.66 n/a
Adjusted EPS (non-GAAP)$0.58 $0.82 $0.87 $0.70*
Adjusted EBITDA ($M)$17.9 $19.4 $20.5 $17.5*
Adjusted EBITDA Margin (%)14.4% 13.8% 13.9% n/a
Net Income Margin (%)7.9% 7.4% 6.5% n/a

S&P Global values marked with * [Values retrieved from S&P Global].

Notes:

  • Company-reported adjusted metrics are non-GAAP; reconciliations provided in exhibits .
  • SPGI EBITDA estimate appears standardized; company’s primary profitability KPI is Adjusted EBITDA ($20.5M), which may not be directly comparable to the standardized consensus figure ($17.5M*) .

Segment/Vertical and Mix

Vertical/Mix KPIQ4 2025YoY Detail
Retail & E‑commerce (mix)25.3% of revenue +24.5% y/y growth in Q4
HealthTech (mix)14.0% of revenue +19.0% y/y growth in Q4
Travel/Transportation/Logistics (mix)13.8% of revenue +10.0% y/y growth in Q4
FinTech (mix)10.6% of revenue Declined y/y; expected to stabilize
Digital/Omnichannel mix82% of revenue Up from 77% p/y
Offshore revenue share49% of revenue Offshore revenue +17% y/y

Cash Flow and Balance Sheet KPIs

KPIQ4 2025
Free Cash Flow ($M)$22.8 (record)
Net Cash ($M)$13.7
DSOs72 days (quarter-end)
Capital Expenditures ($M)$5.2 in Q4; $18.4 FY25
Weighted Avg Diluted Shares (M)14.491

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
RevenueFY25$540–$545M (as of Q3 FY25) Actual: $558.3M Exceeded high end
Adjusted EBITDAFY25$68–$70M (as of Q3 FY25) Actual: $72.0M Exceeded high end
RevenueFY26n/a$590–$610M New
Adjusted EBITDAFY26n/a$75–$79M New
RevenueQ1 FY26n/a$143–$146M New
Adjusted EBITDAQ1 FY26n/a$17.5–$19.0M New
CapexFY26$15–$20M (FY25 guide) $20–$25M Raised vs FY25 level

Earnings Call Themes & Trends

TopicPrevious Mentions (Q2 FY25)Previous Mentions (Q3 FY25)Current Period (Q4 FY25)Trend
AI/Technology initiativesAdded key AI opportunity wins to deploy in H2; margin-accretive expectation Continued AI progress alongside India entry; raised FY25 guidance -“Shift from proof of concept to full-scale deployments” of AI agents; integrated AI-to-human journey differentiation Accelerating deployment and client adoption
Mix/Profitability driversOffshore growth +14% (Q2), adjusted EBITDA expansion y/y -Offshore growth +19% YTD; adjusted EPS record; EBITDA margin mixed due to SG&A Offshore 49% of rev; digital/omni 82%; gross margin ~31.4% Sustained favorable mix; investment-led SG&A headwinds
Vertical demandHealthTech +31%, Travel +17%, Retail +4% (Q2) HealthTech +20%, Travel +19%, Retail +14.6% (Q3) Retail +24.5%, HealthTech +19%, Travel +10%; digital acquisition strong Broad-based strength; Retail outperformance
Geographic expansion—Strategic entry into India launched with leading healthcare client India cited as growth and margin vector; continued expansion planned New market scaling
Client concentration—Diversifying; share repurchase plan -Largest client <10% of revenue; top 5/10/25 stable Lower concentration risk
Macro/tariffs/regulatory——Acknowledges “fluid market environment”; maintains confidence Watch but not constraining guidance

Management Commentary

  • Strategic positioning (CEO): “This quarter marked the shift from proof of concept for our AI solutions to full scale deployments, setting the table for future growth.”
  • Competitive advantages (CEO): “Having a seamless integrated solution from AI agent to human agent uniquely positions us to support customers along the entire customer journey.”
  • Growth engine (CEO): “Our growth has been driven by operational excellence with our embedded base clients… while our differentiated value proposition resulted in continued new logo wins with trophy clients.”
  • Profit mix (CFO): “Offshore revenue grew 17%… comprised 49% of total revenue, allowing us to maintain our strong gross margin of 31.4%… Digital and omnichannel delivery represented 82% of our total revenue.”
  • Capital allocation (CFO): “We ended the fourth quarter with… net cash position of $13.7 million… reflecting $77.2 million in share repurchases during fiscal 2025, including our $70 million TRGI share repurchase.”

Q&A Highlights

  • Sustainability of sequential Q4 strength: Management characterized growth as “sustainable, annuity-type business,” driven by market share wins within embedded clients, strong digital acquisition, and new logos; no client losses noted .
  • GenAI impact on volumes and business model: Management sees net positive impact; moved to full-scale implementations; differentiation is owning the “AI agent to human agent” journey backed by richer data, creating another growth vector .

Estimates Context

  • Q4 FY25 vs S&P Global consensus: Revenue $147.1M vs $132.9M* (beat ~10.7%); adjusted/normalized EPS $0.87 vs $0.70* (beat). FY25 revenue $558.3M vs $544.2M* (beat); adjusted/normalized EPS $2.75 vs $2.58* (beat) . S&P Global values marked with * [Values retrieved from S&P Global].
  • Implications: Street likely raises FY26 revenue/EBITDA on sustained share gains, AI deployments, and favorable mix (offshore, digital/omni), partly offset by SG&A investment run-rate and FinTech softness .

Key Takeaways for Investors

  • Clear top-line reacceleration with durable drivers (embedded base share gains, digital acquisition, AI deployments), delivering double-digit beats vs consensus and exceeding FY25 guidance high end .
  • Mix tailwinds (82% digital/omni; 49% offshore) underpin margins despite investment-driven SG&A; watch for further AI-led efficiency and margin upside as deployments scale .
  • FY26 guide ($590–$610M revenue; $75–$79M adjusted EBITDA) frames continued growth; Q1 FY26 guide ($143–$146M revenue) suggests momentum carrying into FY26 .
  • Record free cash flow ($22.8M in Q4) and positive net cash ($13.7M) enable ongoing investment and optionality after $77.2M of FY25 share repurchases .
  • Risk checks: EBITDA margin modestly compressed y/y on SG&A, impairments, FX; GAAP EPS down q/q; FinTech exposure declined though pipeline expected to stabilize .
  • Near-term trading setup: Revenue and adjusted EPS beats plus FY26 guide should support positive estimate revisions and multiple stability; any commentary on AI scaling, India expansion, or new-logo wins likely to be incremental catalysts .
  • Medium-term thesis: Differentiated AI-plus-human model, rising digital/omni mix, and expanding offshore footprint position IBEX to outgrow BPO peers and compound FCF through cycles .

Sources

  • Q4 FY25 8‑K and press release, including financial statements and non‑GAAP reconciliations
  • Earnings call transcript (prepared remarks and Q&A)
  • Prior quarters for trend context: Q3 FY25 8‑K/PR ; Q2 FY25 8‑K/PR
  • S&P Global consensus (Revenue, EPS, EBITDA) for Q2–Q4 FY25 and FY25/FY26: values marked with * [Values retrieved from S&P Global].