Exlservice (EXLS) Q1 2026 earnings summary

Executive summary

• Achieved Q1 2026 revenue of $570.4M, up 13.8% year-over-year, driven by growth across all segments and expansion with new and existing clients.

• Adjusted diluted EPS reached $0.58, up 20.2% year-over-year; GAAP diluted EPS was $0.43, up 5.7%.

• Net income for Q1 2026 was $67.1M, up 0.8% from Q1 2025.

• Gross margin improved to 38.9% from 38.6% year-over-year, reflecting operational efficiencies.

• Added 16 new clients and received multiple industry recognitions for AI and technology leadership.

Financial highlights

• Adjusted operating income for Q1 2026 was $117.2M, with a margin of 20.5%; operating income rose 17.1% to $91.8M.

• Adjusted EBITDA was $127.9M, margin 22.4%.

• Net income (GAAP) for the quarter was $67.1M; adjusted net income was $90.7M.

• Cash, cash equivalents, and short-term investments totaled $253.8M at quarter-end, with $206.9M held in foreign jurisdictions.

• Net cash provided by operating activities was $1.7M, down from $3.2M in Q1 2025.

Outlook and guidance

• Full-year 2026 revenue guidance raised to $2,300–$2,330M (10–12% year-over-year growth).

• Adjusted diluted EPS guidance increased to $2.18–$2.23 (12–14% growth).

• Management expects to use operating cash flow to invest in digital and AI capabilities, with planned capital expenditures of $50M–$55M for 2026.

• Existing liquidity and cash flow are expected to be sufficient for the next 12 months, supporting growth, acquisitions, and share repurchases.