Capgemini (CAP) Q1 2026 TU earnings summary

Executive summary

• Q1 2026 revenue reached €5.943 billion, up 11.0% year-over-year at constant exchange rates and 7.0% at current rates, driven by robust organic growth, cloud and AI strategy execution, and contributions from WNS and Cloud4C acquisitions.

• Bookings totaled €6.054 billion, up 6.2% at constant exchange rates, reflecting strong commercial momentum, large transformation deals, and over 11% of bookings from generative and agentic AI.

• All major sectors grew excluding acquisitions, with financial services, public sector, and TMT showing strong underlying growth, particularly in North America and the UK.

• Operations & Engineering grew 25.2%, and digital business process services maintained double-digit like-for-like growth, confirming strategic focus on AI-led transformation.

• Major transformational deals and long-term commitments, including a five-year extension with a key global client, supported growth.

Financial highlights

• Revenue grew 7.0% year-over-year on a reported basis and 11.0% at constant currency, with a 4.0% negative currency impact and 6.5 percentage points from acquisitions.

• Book-to-bill ratio was 1.02, slightly above the 10-year average for Q1, indicating solid commercial momentum.

• Headcount increased 23% year-over-year to 421,000, mainly due to the integration of WNS and other acquisitions; offshore leverage at 66%.

• North America and UK & Ireland delivered over 20% growth at constant currency; France declined by 1%, while Asia Pacific and Latin America grew 26.9%.

• Attrition rate at 18.6% in Q1, down 1.2 points year-over-year on a like-for-like basis.

Outlook and guidance

• Q2 2026 expected to deliver around 10% constant currency growth, including 6.5% from inorganic sources.

• Full-year 2026 targets unchanged: revenue growth of 6.5%-8.5% at constant exchange rates, operating margin of 13.6%-13.8%, and organic free cash flow of €1.8-1.9 billion, factoring in €200 million higher restructuring outflows for Fit-for-Growth initiatives.

• Margin improvement expected in H2 as Fit for Growth benefits materialize; H1 margin to be broadly in line with last year on a like-for-like basis.