Globant (GLOB) Q1 2026 earnings summary

Executive summary

• Q1 2026 revenue reached $607.1 million, exceeding guidance despite a 0.7% year-over-year decline, with strong free cash flow and record revenue per head.

• AI-native services, especially AI Pods, are now central to the business, with AI Pods ARR at $32.8 million as of March 2026 and a $352 million pipeline.

• The company reaffirmed the midpoint of its full-year revenue outlook, narrowing guidance and expressing confidence in sequential growth for the remainder of 2026.

• Strategic partnerships with hyperscalers and AI leaders (OpenAI, Anthropic, AWS, Google, NVIDIA) expanded, reinforcing the AI-native orchestration strategy.

• Announced a new $125 million share repurchase plan after completing the previous program, with disciplined capital allocation and continued investment in high-return AI initiatives.

Financial highlights

• Q1 2026 revenue was $607.1 million, down 0.7% year-over-year but above guidance, with a 400 bps improvement in trajectory from last quarter.

• Adjusted gross profit margin was 37%, impacted by LATAM currency strength and statutory cost increases.

• Adjusted operating margin was 14.1%; adjusted net income was $65.2 million (10.7% margin); adjusted diluted EPS was $1.50.

• Free cash flow was $36.1 million, the first positive Q1 free cash flow since 2019, with a free cash flow to adjusted net income ratio above 55%.

• Cash and short-term investments totaled $200.5 million as of March 31, 2026.

Outlook and guidance

• Q2 2026 revenue expected between $610 million and $616 million, with sequential and potential year-over-year growth.

• Full-year 2026 revenue guidance maintained at $2.462 billion–$2.508 billion, implying 0.3%–2.2% year-over-year growth.

• Adjusted operating margin for the year expected between 14% and 15%; adjusted diluted EPS range of $6.10–$6.50.

• Guidance assumes stable conditions in the Middle East; lower end of guidance reflects potential deterioration in that region.

• Positive FX impact of 100 basis points included in outlook.