Business transformation services company Genpact (NYSE:G) reported third-quarter 2025 results that beat market revenue expectations, with sales up 6.6% year-over-year to $1.29 billion. The forecast for next quarter’s revenue was better than expected, with $1.3 billion at the midpoint, 1.2% above analyst estimates. Its non-GAAP profit of $0.97 per share was 8% above analysts’ consensus estimates.
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Revenue: $1.29 billion vs. analyst estimates of $1.27 billion (6.6% YoY growth, 2% beat)
Adjusted EPS: $0.97 vs. analyst estimates of $0.90 (up 8%)
Adjusted EBITDA: $222.1 million vs. analyst estimates of $235.7 million (17.2% margin, 5.7% error)
Revenue guidance for the fourth quarter of 2025 is $1.3 billion at the midpoint, above analyst estimates of $1.29 billion.
Management raised its full-year adjusted EPS guidance to $3.61 at the midpoint, an increase of 1.7%
Operating margin: 14.8%, in line with the same quarter last year
Free cash flow margin: 22.6%, compared to 17.2% in the same quarter last year
Market capitalization: 6.77 billion dollars
Genpact (NYSE:G), originally spun off from General Electric in 2005 to provide business process services, is a global professional services firm that helps companies transform their operations through digital technology, artificial intelligence and data analytics solutions.
A company’s long-term sales performance is a sign of its overall quality. Even a bad business may shine for a quarter or two, but a top-notch business grows for years.
With $5.01 billion in trailing 12-month revenue, Genpact is one of the largest companies in the business services industry and benefits from a recognized brand that influences purchasing decisions.
As you can see below, Genpact’s sales grew at a decent compound annual growth rate of 6.2% over the past five years. This shows that their offerings generated slightly more demand than the average business services company, a useful starting point for our analysis.
Genpact Quarterly Revenue
Long-term growth is most important, but within business services, a half-decade historical view can overlook new innovations or demand cycles. Genpact’s annualized revenue growth of 6.3% over the past two years is in line with its five-year trend, suggesting its demand has remained stable.
Genpact YoY Revenue Growth
This quarter, Genpact reported 6.6% year-over-year revenue growth and its $1.29 billion in revenue beat Wall Street estimates by 2%. Currently, company management anticipates a year-on-year sales increase of 4.5% in the next quarter.
Looking ahead, sell-side analysts expect revenue to grow 5.2% over the next 12 months, similar to its two-year rate. Despite the slowdown, this projection is above average for the sector and implies that the market sees some success for its new products and services.
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Genpact’s adjusted operating margin can fluctuate slightly over the past 12 months, but has generally remained the same, averaging 16.8% over the past five years. This profitability was top-notch for a business services company, demonstrating that it is a well-managed company with an efficient cost structure.
Looking at the trend of its profitability, Genpact’s adjusted operating margin can fluctuate slightly, but it has generally remained the same over the past five years. This raises questions about the company’s expense base because its revenue growth should have given it leverage over its fixed costs, resulting in better economies of scale and profitability.
This quarter, Genpact generated an adjusted operating margin of 17.7%, in line with the same quarter last year. This indicates that the company’s overall cost structure has remained relatively stable.
Revenue trends explain a company’s historical growth, but the long-term change in earnings per share (EPS) points to the profitability of that growth; For example, a company could inflate its sales by overspending on advertising and promotions.
Genpact’s EPS grew at a remarkable 10.6% compound annual growth rate over the past five years, higher than its 6.2% annualized revenue growth. However, this alone doesn’t tell us much about its business quality because its adjusted operating margin didn’t improve.
Genpact Trailing 12-Month EPS (Non-GAAP)
As with revenue, we look at EPS over a more recent period because it can provide insight into an emerging theme or development for the business.
For Genpact, its two-year annual EPS growth of 12.2% was higher than its five-year trend. We love when earnings growth accelerates, especially when it accelerates from an already high base.
In the third quarter, Genpact posted adjusted EPS of $0.97, up from $0.85 in the same quarter last year. This impression exceeded analyst estimates by 8%. Over the next 12 months, Wall Street expects Genpact’s full-year EPS of $3.60 to grow 4.7%.
It was good to see Genpact beat analysts’ EPS expectations this quarter. We’re also glad that its revenue forecast for the next quarter slightly exceeds Wall Street estimates. Overall, we think this was a decent quarter with some key metrics above expectations. The stock rose 4.8% to $40.20 immediately following the report.
Genpact had an encouraging quarter, but an earnings result doesn’t necessarily make the stock a buy. Let’s see if this is a good investment. If you’re making that decision, you need to consider the bigger picture of valuation, business qualities and recent earnings. We cover that in our comprehensive, actionable research report which you can read here; It’s free for active Edge members.
