EXLS - Earnings call transcript Q1 2022 | ExlService Holdings, Inc.

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Operator

Good day, and thank you for standing by. Welcome to the First Quarter 2022, ExlService Holdings, Inc. Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speakers’ presentation, there will be a question-and-answer session. Instructions]. [Operator like Mr. conference now speaker to hand today, for to would over the your I Vice of Barlow, Steven President Investor Relations. Please go ahead, sir.

Steve Barlow

Good First Results Thank today of Investor Steve [Indiscernible]. morning, for President Thanks you, joining Barlow, for Vice EXL’s Call. Quarter Conference Financial Relations. FYXX I am everyone. us

Release Chairman QX an our issued the Officer. Chief we On Vice We today XXXX opportunity Officer, Executive hope Rohit are Chief call had to Financial our review and Earnings our you morning. Kapoor, and Maurizio this Nicolelli,

We section updated our Investor have Investor also Factsheet of the in Relations EXL’s website.

cause periodic some risks matters today's filed known no Commission results forward-looking. forth are to to assumes these and discussed obligation in uncertainties factors from materially As Such this those include, of time. you or presented to call. call the mind statements this from to, to company's on set forward-looking discuss and and conditions, are unknown know, but by differ general keep that actual and information press EXL in Exchange such expressed the statements. could release the economic those we'll Securities reports risks subject in implied and are Please not other that in time limited update the with documents uncertainties

today, Kapoor, as Rohit. release, Factsheet. over to of measures press call to these on Executive call non-GAAP our financial be useful Reconciliation investors. in now Chief Officer. measures, as reference our I'll our we During certain the the provide GAAP may for which Rohit we turn information believe well found Investor can

Rohit Kapoor

you healthy. your I our to a to that I'm hope EXL start year. families everyone. are Thank all you, Good morning, and QX the XXXX to Steve. earnings strong had report delighted safe call. and of Welcome

and adjusted our quarter. the revenue expectations In outperformed we for EPS, of terms

the XX.X% and year-over-year. revenue first up quarter million, $XXX.X previous Our from quarter, was XX.X% up

quarter, up EPS XX.X% per a was share, $X.XX adjusted the For year-over-year.

total revenue with from expertise XX.X% our accelerated excellent year-over-year. our scale and another growth. accounts and had XX.X% now segment of The us quarter Analytics data has sequentially, our up and $XXX Analytics differentiated competition Our revenue. of maturity million, business XX% Analytics overall of for

quarter financial examples turned the would We've $XXX.X Emerging being clients two, saw these EXL value This up And Our illustrate one larger Digital like customer strong for X.X% segments. double-digit the engineering, industry, to able delivering from engagements. entire the growth driven aspects this quarter-over-quarter, and million growth business revenue XX.X% year-over-year. funds was core added industry-leading relationship and across multiple analytics of Solutions and of verticals also growth few of In our primarily across a in transformation strength initiated our revenue double-digit our enterprise-wide recently analytics, with scalable to share consistent strategic our client, with and largest Insurance up in I data and in us to its Operations drive This leveraged growth chain. rates data management U.S., deploying across our number the industry management. number account by investment data digital are industries. analytics that revenue we that new business, been solutions a two which acceleration. by one, services

win across client is engagement, We driving project. customer higher channels, consumer significant are sets. data leveraging our value. and is the This experiences to the of terms client's This technology better from building of digital larger unstructured to and structured customer non-digital scope deliver also and in industry extract the and insight expertise lifetime this and allowing scale both

to with annualized new $XXX start of revenue a typically While historically, we thousand. relationship XXX would client

our workflows offerings a to U.S. our well of union Thanks, to scale enterprise-wide accelerate annualized with reducing bigger customer allows wanted well revenue is data above included now signing across leading legacy customer recent as initiatives. personalization clients lending challenges million our lack $X improve And process, higher. credit client manual established. of to pace the year is clearly on example or leadership analyst. onboarding. are the to This underwrite complex acquisition in underwriting $X in with slide that products and drive In journey. is by customer new This the EXL example, is us of the work engagement the now this technologies, boarding We in experience particular time such increasingly to An It how turning multiple example larger offer revenue of lending that and million. a the slowed our and prime are transformation first engagements annualized for

entire existing across be segment. EXL helping approach data, the in plug a offerings client leveraging analytics, us base. adding cloud capabilities emerging fashion and partner, expanding our client can out lending lines new digital and analytics, data quarter, designed play the much vertical, digital this extraction platform within by capabilities digital real-time customer strategic in across create and the multiple client now we to also product and response right breadth Each faster of time. offers underlying that This next-generation AI-powered based scalable were to right deployed and logos. the to our secure platform immediately been decisions. and By allows right more This that depth operations and lending a new able on comprehensive digital, products As our our scalable data. EXL business personalized client of lending number wins while more have in This a combining at fully we offer of is customer one increasing helped customer time our our is automate solutions

a transformation become projects. example become of prime our continued has enterprise business Insurance choice we as Our partner evolution, for large-scale of the

party Services Provider leader and Insurance in XX In categories EXL in recently of showcased We for ' including recognitions and Insurance third U.S. overall is fact, and we casualty, year's HFS administration. trial leadership in a a for capability. ISG second all have were industry the BPO. that and this major the announced this Australia, ranked in Top property Lens life,

the straight top third Matrix acquisition have a Analyst as and spot of our Property strengthened understanding recognized the In and approximation the strength capabilities, data and of The operations. addition services on for Casualty of global year, Everest security. foundational clients. announced for insurance our Group's note star engineering, Insurance and our our leader our last Assessment Cloud performer. digital data a For and a partner, of domain acquisition AI enablement, data, expertise a proposition year, PEAK Everest as and the The December depth to strong both manage in with EXL Company. in Services The value design we data Cloud and management, adds team Clairvoyant's capabilities combined Clairvoyant,

added potential truly talent have data. and of a their are unlock enabling for significantly to We clients base to of the more integrated our set our services

last the our of has introduced course prospects. new existing the our Over quarter, team capabilities to and combined customers

response We our are thrilled and the value adoption proposition. of expanded with

successfully business. with customers has significantly several started large across Analytics strategic growth engagements the for joint We of added our all potential overall our have to verticals. This

oriented and space, in inflation wage at sets that both The top Clairvoyant particularly demand We that expectations. analytics past skill increased our is is few our priority EXL. skilled has our data profitability and and meeting in talent we're around for acquisition significantly Balanced are digital, management managing the Cloud, the revenue pleased months.

holistic a comprehensive strategy We a have ensure employee degree adopted XXX to perspective. from and well-being

as First, people. driver helps our and the collaborate that best key culture our brings is a us a out team in

career caring and promoting collegial the programs employees been of strong talent widely. EXL completed entrepreneurial growth, within our training employees includes the pathing - almost XXX,XXX XXXX, help advance our their and and This with. In organically. has engage culture, up focus growing careers. environment, a Our on long - history of skilling developing manner continual to work them embraced from and in which have strong we cherish in our a hours

Second, the we benchmarked the compensation us possible have allows best talent. attract in competitive and marketplace. benefits to be retain our to and This

years, two operating have last we be business terms in chosen the to model. of Over our flexible

align and of together. hybrid employees needs create the to with to and have with innovate policies, our our work We regulatory an environment requirements, client's collaborate expanded best compliance models

on well-being also focus as mental at employee outside is important a We and from focus and EXL have wellness. fast a health growing Recruiting are on significantly accelerated we our physical both pace. with

Our we do business at work world's growth kind provides our universities our a opportunities for Analytics, employees for get advancement and In to models. be The leading and fox new the stimulating is recruiter breaking of challenges technical our for learn, and for technologies we exposed very It and clients employees. helps successful to cutting-edge schools. continue grow, employees. our

people top recruiter for In most our talent assets. important years. been our XX have for We over are our summary, analytical

for incredibly preferred a destination This We to build EXL. to will rewarding an employees EXL time a is career. endeavor make continue for to exciting

we volatile closely geopolitical economic the and are While monitoring environment.

and the navigate to We are changes our enormously agility confident ability in marketplace. in

We are our solutions and of data have strategic deal helped the create great capitalizing past us a over that quarters. on momentum investments several driven

and now We guidance. Maurizio value for I seize clients. XXXX opportunity the are invite performance QX market our create meaningful to well highlight prepared will our to financial and

Maurizio Nicolelli

into this you, will outlook Thank provide for our followed quarter, for performance morning. for joining thanks XXXX. I our us by everyone first insights the And Rohit. revised financial

to organic expansion and mentioned relationships EPS Analytics an lines, XX.X% revenue in Digital down volumes and organic business travel, Analytics had grew better up of year-over-year, client our was Digital basis. annuities, up XX% vertical million, Emerging was Healthcare reportable Solutions defined the lower Healthcare business of year-over-year. revenue client and million sequentially basis. our up All organic by They quarter, million, reported XX.X% currency $XXX.X in year-over-year volumes increased generated our basis. in year-over-year and and banking XXX million in million of in from excluding revenue constant wins in new businesses, year-over-year. transportation, XXXX. analytics grew on Operations basis. Our services growth $XXX.X currency Insurance Payment in of and grew $XX.X XXXX, XX.X% existing consisting up on organic of The clinical million an Clairvoyant an year-over-year of consisting due financial Sequentially client driven integrity, revenue The direct Emerging our life higher and XX.X% XX% client. insurance new year-over-year. due was by This and sequentially, numbers Digital audit from of and businesses up constant of and revenue Analytics strong our million, demand continued and and Analytics businesses, and XX was from client contributed to wins grew by indicating by wins hereafter and in driven logistics are expected This including the survey quarter on as was Solutions higher revenue, year-over-year currency on vertical, XXXX momentum Operations protocol, Clairvoyant and quarter three businesses. $XXX.X Analytics a reported volumes X.X%. up was Operations a segments, revenue with in XX.X of Adjusted for XXXX, X.X% XX% growth growth XX.X% revenue volumes both constant was and marketing, $X.XX. Digital Operations revenue a in fourth transition consisting services. than new driven businesses XX.X%, reported XX.X% year-over-year. constant both $XX.X Revenue Solutions services. year-over-year. of currency Solutions Analytics up fourth

capabilities. increased points digital driven revenue sales of by year-over-year in front end expenses investment SG&A XX by to basis and XX.X% Our

basis down margin by and margin operating XXX wins due lower new operating XX.X%, end points for client investments Sequentially, operating was and sales our XXXX investments adjusted leverage. adjusted front to in ramping points, and in by capabilities. the increased digital Our up basis in quarter XXX driven needed expenses marketing a year-over-year

Our points effective U.S. mainly quarter tax certain XX decrease rate down was was by XX.X%, lower for year-over-year. This taxes the in driven basis jurisdiction.

the quarter on reported up was year-over-year XX.X% for $X.XX, basis. EPS a adjusted Our a

balance remains sheet Our strong.

-- and to of amended Our which cash five-year Subsequent with the EXL XXX quarter, million, for feature position accordion $XXX of credit XXst to an million. debt XX into XXX agreement investment net our March additional we an totaling close at entered and was was a debt short-term amended borrow the an allows million. million, million, $XXX

our million the due This Our which early of first-quarter compared operations were $XX.X April performance cash flow outflow of to received bonus collections first strong inflow quarter payouts to in of $XX.X XXXX. from and to million was an client timing in higher is financial of receivable in the XXXX. due an

we repurchased $XXX,XXX $XX $XXX the During price million. an of at shares quarter, totaling average a

first for guidance the the to the performance our In the quarter spent for XXXX. verticals, $XX on visibility addition, as for are rest on we in in expenditures all long-term business Based increasing year we our we of our million growth. growth and capital continued invest current

of quarters. X% revenue may not occur First-quarter that subsequent includes the onetime in revenue

is XX% in rate Our a XX% a This revised Revenue guidance $X.XXX follows. guidance billion. XX% and an $XX on constant XXXX of $X.XXX billion. $X.XX $X.XX on of basis. This basis to be to to is to expected the previous of from is an at as the midpoint million of increase year-over-year billion to reported currency represents range organic growth XX% the billion

guidance $XX line which million to Our with Clairvoyant $XX guidance. includes in our revenue from previous of is

includes certain such to XXXX. areas AI, as guidance salary and in higher Cloud expenses Our Analytics, compared

course over office the our our in and percentage to working the the of year. to return the from rise started in expect have the employees We manner March phased of a office

model hybrid forward. of going have a We working will

to We work X/X remotely. full time work expect of employees from office our to either or approximately part-time and X/X the

mandating We income million the April Xst. tax of million our to in the issued as the tax gain implications between where X effective around return regulations we is There X to percent significant employees to Philippines, approximately office to uncertainty the net X local and be on employees, government have of the XX% rate definition and the X,XXX approximately exchange of foreign million expect XX%. a the regulations In has range and of rate. interest the required

guidance. been $X.XX on working the in are tax to EPS the these in the our manage we and our from in not be with had to XXXX. any in reported we workforce, to XX% additional adjusted range expect Based included above, $X.XX our one-time comply Philippines While we $X.XX of to expense XX% regulations up the

we capabilities, and areas allocation, insurance digital capital tuck-in the in in healthcare. current growth and of analytics, to to priced our look rates terms revenue at acquisitions In similar continue reasonably business of solutions with

range continue $XX to at our continue expenditures to be addition, to in will In developed of capabilities XXXX. similar internally we to on anticipate million. pace We will program the spend capital expect and $XX a buyback

transformations, EPS will second be one-time XXXX. due quarter the results quarter, to the acquisition-related quarter have return-to-office three lower revenue wage momentum. in of at than first good started return increments starting in the investments Adjusted the as Looking April very in months In with the to higher costs. we gradually to office, due the Xst, to the to first quarter revenue be similar we first expenses digital expect annual we and conclusion, second XXXX

deal Our and of pipeline our clients of opportunities continues to grow expansions with sizes, client wins. larger work new long-term with

on remain XXXX while we drive rest the value. growth, the Based are the enable we addition, we In visibility in will cost structure for our vigilant as to on year, our of shareholder the market addressing volatility. us business have which grows confident

be would questions. your I to and Rohit Now, happy take

Operator

to [Operator Instruction] just compile We'll pause moment for Q&A a the roster.

of line from first Bryan Cowen. comes Bergin question the Your from

is line Your open.

Bryan Bergin

morning. Good you. on outlook here. Start the Thank

the revenue raised you're of XQ top board the XQ XQ. revenue not think mentioned includes, may you strong across that and know X% performance, a Maurizio, that I occur. out here you The FYXX So beat I on outlook

looks drove is dig this three the And you the year. more expectations if can shifted that? approach or you are within margin changed your changes a the What dynamic Just that drop Can it that curious year So months XQ then like into there's about undoubtedly talk something little if more? in about early versus is in it's bit ago? notable would any around the there. going that EPS

Maurizio Nicolelli

Sure, Yeah, Bryan. sure.

not revenue, or and Operations our that foreseen question really first forward, first and Solutions those and volumes the the so categorize We've did that we've Analytics going Digital as higher unexpected volumes businesses we anticipate on some we them expect. not in foresee quarter going one-time So get your did both in don't X% one-time forward.

wanted we this on to that's to why that call. everyone So highlight

are a In into into XXXX. terms mean is the it's year. year. we've months very rest still certain early there level uncertainty of EPS three the the our only There guidance, of of in we're -- I --

And business. seeing want We some of we make certain we amount a managing of for in a inflation properly And forecast our start attrition return sure do critical particularly are we're starting going increase starting Philippines. in to in that expense amount our the the certain areas that's to pieces workforce, see to wage We again, certain to that. -- the year. of office, and our to of go we're to we're that throughout

you EPS So forward as the we being it guidance. as in early to It's we as we year, certain have visibility. categorize a conservative. our raised we'll so our get But go more extent, adjust could guidance still

Bryan Bergin

it workforce, a just so of attrition Is in more? just healthy on And spiking, did to workforce bit just additions follow-up as And that then sense. little any where just you just dig more far headcount than you're you that's Philippines the a where plans spite makes that And occur. can your seeing That have comfort the in as levels remediation. for in the in occurring.

Rohit Kapoor

first of added in attrition largely rate and new existing driven by we're We've the up our the have that that quarter from quarter FYXX XXXX, had. Philippines. did of seeing of a higher driven a growth and in principally being Bryan. and significant amount went We the the the that in clients that clients was Sure. employees attrition that's first we've by

be able for we this got our base very business us won. to talent. feel for recruit, I market in that of amount in to retain to employee the attract our entire delivery Philippines. onboard confident up service and uncertainty a our managed in have and to amongst And think rate strong a it that attrition went positioning We and brand much We've the clients there up and out pretty drove ability that industry for there's considerable the execute the there.

a to invest this our we something our grow core and to significantly part is business and continue very we business. our feel this which add build confident in and is area, and of So ability in

Bryan Bergin

Okay. you. Thank

Operator

line comes Nolan question the Maggie Blair. from of next Your from William

open. Your line is

Maggie Nolan

Hi. dynamics? that you kind talk you're a Thank in amongst out? top account couple those the buckets little of Can you bit What seeing you. your about top break

Rohit Kapoor

Sure, Maggie.

are and growth really down are in of business we of got We've the of existing add concentration that of accounts. as and Our new clients kind strategic our top grow we kind continues our come diversify with that accounts relationships actually relationships. our client continuing rate to client strong to reflected customer existing

top They in XXXX, very to grow continue think to we for number remain to sharply offerings I huge and nicely. will FYXX grew of us. think of in wallet with XX grow service these clients, continues our take well. we that new share the very a that very, The accounts we continue can as opportunity and

clients with penetration continue with ability still our to these grow is to expand these therefore, low. clients high. Our And is very and relatively

different As way. buying we in believe different grow lines, we product continue with top in meaningful engage clients our existing with in different we in to them and our clients geographies, that centers, a can with

Maggie Nolan

And circumstances a clients and you in healthcare provide Thank ops and when you to more the and of you. on transitioning transition -- expect then little business detail like, can timeline impact looks Okay. -- the annualize. the what and that

Rohit Kapoor

side business. type And very business, that's of combined rate terms of which appliance as which happens where client some that in capabilities had This relationship the something the if got the well, The a we the much client in is. to in terrific we into the The you healthy double-digits, analytics the at is them. are on transition despite that of healthcare clinical of and take helping normal can look business. disclosed in this the This side but the That's that is We've Sure. with building up conversion see to growth which on something in all a pretty wanted growth transition. key rate helping thing It’s Healthcare of are pretty the combined terms that them transition. of something we Analytics our work the format. business, of transition captive previously our time. we is our and assist

is So performing very we're with overall happy how actually portfolio the

Maggie Nolan

you. Thank

Operator

next Shirvaikar from comes Ashwin from Citibank. Your the line of question

Your line is open.

Ashwin Shirvaikar

start contracts given higher that out your Thank specific contract, then that trend prepared sporadic? seeing And board? The to results. of you. for just example on about broaden you rate? down just larger towards I'd of sustainably it Good contracts. faster? top-line like to say, growth asking the in was those the more across want larger Does is to also I mentioned ramping to remarks lead are happening the Or Analytics, kind is the but the still road a you've

Rohit Kapoor

Thanks, Ashwin.

very now. right are demand strong in we yes, environment the So seeing marketplace

holistically. We Operations that's us to are at data they our looking large in seeing us manage. and And contracts, and also engaging but only Digital Solutions business. our They're business, clients run not want with in are Digital enterprise-wide much processes analytics because more

months And very XX it's seeing past, So six that deal. been typically Digital also that's the the sales in in for being Today, the XX month speed of sales Operations of helpful. a We're cycle accelerate. about have speed. terms might decision-making to cycle our

larger faster environment to it's we that making, frankly, provide demand many target very contracts, more clients. services rich our So can a now. right And decision

Ashwin Shirvaikar

Are on Where a about longer-term just strategic With like saying do but do return you back? I know see and out? talk the -- call sort the that. Philippines, early playing country, to of it? you it's it out the and workout are to to I Got that that there moving of regulatory question how in categorization And uncertainty just still of days, we there no is coming gotten regards options type the this office. of perhaps employees with see that meet, regards to could sort if with the -- it.

Rohit Kapoor

Sure.

Philippines, office Xst that XXX% I back the have employees effective authorities brought all be was regulatory change April. asked the think of to in and look, for the So to

office, versus needs the something days does in working which working to way the who's what's from categorizes home, the from they getting in are how that remotely. many versus in a However, is terms office clarified defining employee of working an person which be is month in

the stabilized the months. also in all elections place will this will quarter in few get it think are presidential clarified or I get so. Philippines next taking are and There next the over that

that's that alignment new the sort will out. slightly administration So itself the with

make employees also But needs of to as to employees. the we it together we concerned, with flexible with to want clients, collaborate As sure an far the that for our the needs our the ability want we to meet innovate. and are balance requirements, to remain out regulatory and get us to of

balancing really I'm particular the to employee regulatory mix that. regime And coming an thesis it's a out will So sure flexibility, innovating. that months with next We're around customer requirement, over our and and this the stabilize. that and work and together overall collaborating optimal the of going few jurisdiction, towards

Ashwin Shirvaikar

And have question that it more focus the just from clarification, case? as you other the not less was, healthcare. is of Is for the that or part higher -- is work-based Thanks. that Philippines

Rohit Kapoor

which Philippines work do digital Yes, qualified lot nurses of We and the in a in out capabilities. with integrated clinical licensed Philippines, we mind the in do U.S. work do Philippines. and do registered resources case. but the keep in completely waste have We that's there is have now the have we the that our nurses that

So we these work digital, that it's analytics, -- high-end, do lot operations. really leverages of it's into complex data that a

Ashwin Shirvaikar

you. Thank Good point.

Operator

from comes from line question next Your JPMorgan. of Puneet Jain the

Your line is open.

Puneet Jain

a larger talk the in an can work new macro seeing taking the a but contracts, on an be work Rohit, of how slowdown? slowdown? in that's of that And Digital can is event some been Like about and impact my slowdown. Operations question of how for if are it sized defensive nice in event analytics, macro you thanks deals you macro that some there be business if committed, can also to defensive of Hey, was know that

Rohit Kapoor

Puneet. Sure,

in to with we in an need strongly consistently services now, is in for our the where But partnership need optimal a a solutions any there in said economy, cost on growth services. is or the focus environment clients the the that growth. our actually most high and recessionary money them your structure slowdown our they in As investing is optimize resonate help requires and support our that spend have to again, data environment which because environment, organization in leverage and years an several very to manner, really

to we've that of to importance been if because And that everything to as and feel on types better think focusing every business and be for dollar only the to we increases more environment investment that So more drive slowdown able And them, able the outcomes -- the there for -- it environment on business services is even is this of Analytics return our will better we strategic. I generate And clients. multiple and demonstrate be for economic a more return. cycles. has need across our actually becomes spent

important to think it's our continue economic be whether our frankly, So we business environment, clients. services will a growth environment to or slowdown and recessionary the

Puneet Jain

much or can then high talk you of you're areas. I And the cloud you wage wage inflation seeing? in wage Can know talked you about inflation inflation, on seeing wage size digital different to any is This Analytics regions? also, there how higher inflation inflation issue, ' is Philippines year? level wage inflation or mostly Understood. you about about taxes you wage is across in this there? inflation, seeing also last compared there difference And are

Rohit Kapoor

The to wage It work. a as year. employees know, of level, and sketchy that are up the of order significant. where by and had by digital, it's very very compared market around tell employees, talent, competitive, comp. in another put very that's more of is then and because scarce in Puneet, resources previous by And kinds inflation there now varies it on increment all also we significantly a increment to to so typically we are for the is much Cloud definitely tenure new in wage because senior on Al-driven station, and complicated there. complex areas Analytics, technology. typically Those remain year varies we that's What varies we have of matching that our where varies go and October. is in got. can is you The factored April. a by geography, side inflation it is the in we also many of is I'm and is which have first it a incremental which those XX being which more We much very meaningful as salary employees, this first higher cycle salary definitely we've it topic And Right. areas general you we're seeing increment skillet

factored gets of kind in us it how that's So for year. the through

Puneet Jain

Thank Understood. you.

Operator

comes Mayank question of from Needham and the Tandon from line next Your Company.

open. is line Your

Kyle Peterson

Good Kyle Peterson for is Thanks questions. morning. for actually the This Mayank. taking

growth that is being than to Is bit wanted consider demand, -- medium-term for growth? what the the has you in seems you're more year organic coming do like like What what little on share biggest would noticing you you are the is been guys a just your the is stronger factor the the medium-term guidance for actually The think targets year. you biggest driving range, think gains, that that? environment or driver demand is the or healthier really solid. updated outlook do above running touch about growth Just seems

Rohit Kapoor

Yeah.

data on underwriting, strategic on looking our is and all digital up. digital before. of change activities. we've out which the the value a strategic fundamental fashion. focus The is to the has able the and driving resonating two the requirements. in over marketplace. in of terms that are is the we use our find analytics an are with holistic and very a marketplace And of consumer of of which and client's very, is in together adopted meant areas being across endeavors, second meaningful customer And claims pricing, of very multiple factors. the therefore, in spoken much on embrace strongly trying the consumers to company, their definitely helpful several they positioning on is demand One, deliberately on strategically set providing has much been optimize more And really, to Every most client a there thoughtfully end data, single in think acquisition, experience settlement right about and kind their I create of put past and to in the there years, believe to way really partnership and be transformation our more companies address EXL the data to that's

So which consumer to driven and to our and the factor, the it resonate areas and both its highest positioning resonating in by with this to capability adopt seems changing our transformation demand, very be I the growth broadly. aggressively behavior, which wanting quickly. seems the marketplace. the And more set, pull clients say is much more to would much

Kyle Peterson

quick sense And helpful. and just M&A. so on Makes then a follow-up

are the for on with recent you priced noticed tuck-in a deals. that like more evaluations reasonably still guys Have little of the lookout volatility reasonable You where kind mentioned gotten you have or attractive not to market down to of good targets M&A of easier prices market at it's trickled really volatility little a the, probably some find has private and recent the some valuations? the market

Maurizio Nicolelli

market would the as still M&A pretty frothy. characterize I

that in Clairvoyant bigger much looking will But come many we story are change at at digital needs again, it's think valuations reason still be a full-price within we to which transaction healthcare. areas It's insurance different of were weekly it a did, our And for portion become forward. we move that and at on M&A, very to active valuations. strategic the of have really going forward those need be growth us opportunities and basis to solutions we and [Indiscernible] a to capabilities too similar seen a terms now. specifically, But our of haven't that within Analytics. looking way. on I right been fairly high We

Kyle Peterson

quarter. guess, I good

Operator

line Your from question next from Securities. Katri Moshe Wedbush of comes the

Your is open. line

Moshe Katri

specific questions, about remember Two a for out the sure people maybe potentially and bit coming year? be if more if this budget for any color to calendar budgets. for that guys in changed And And that of not in the types coming you or were defensive. BPO IP and to? out helpful. And doing a will be of about not the visibility guidance in Did picture, past, spoke mention you've is past -- about that Thanks. to picture. then one I'm you correctly, and budgets some more back selling big of the economic slowdown, of tend terms there you're talked bit levels year Has question work few margins big these necessarily the operational the of I years were other going a Thanks. one versus ago.

Maurizio Nicolelli

Okay.

the we first margins that backtrack margins be of don't around consistent year from the gave will But we revenue, XXXX. gave, range, on February. XX% on minimum during when We and to year. they few on that XX% in to low -- comfortable feel get So comfortable you XXXX XX% fairly calculation back of terms that a want we the I with guidance I for margins. EPS But margins. with a I to guidance And number get years. uncertainties back feel the you want for our with are to guidance the guidance -- that which take costs at the for question right had in next give range, medium-term fairly for the back XXXX. gave at is for you there we specific When the we get

Rohit Kapoor

response broader the And parcel being alongside and head. Operating the frankly, business visibility IT budgets our and Moshe, Chief continues part in with the mix, of business. to and It's managing think buyer Officer for and I remain the to are of folded running business the defensiveness the in and And the become business. primary question us the

our work and is slowdown. remain and the risk So part if structure. very pricing operational customer analytics there most and we customer clients that do and analytics have because defensive and business Digital a of management, do the we business defensive optimize management, Solutions do a there do acquisition around even do Digital is will their all cost again, think of is Operations helping data the And business

activities needed frankly, even So are be are that of to these going slowdown. event all ongoing a of the in

Moshe Katri

the here. just And last one

cycle through way typically the looking we Is of that much a an longer into a sales got at go we cycles, right impact when getting During we the did These on slowdown. right? get when slowdown, last it?

Rohit Kapoor

Yes.

I think that's correct.

increase going You clients in terms that's in existing timeline, continue time. probably and but to wanting to might right see more the of to think it's business, the I accelerate going do sales cycle probably

Moshe Katri

Thanks. Understood. Helpful.

Rohit Kapoor

you. Thank

Operator

Instructions]. [Operator

Your from line question Colicchio. the of comes next Vince

open. is line Your

Vince Colicchio

to color can new start you rolling new some deals most And Hi. that are if logos of new in logos? you -- your seeing on the the with the out us seeing that you terms stronger give in process of the Rohit, had quarter? mentioned business. the Are

Rohit Kapoor

Yes, Vince.

the are but the one signed we've is of only of the So not quality logos. that new new up, things, the about of which very we logos number happy

We our balanced are and it's happy between that Operations also business. Digital well and Data Analytics Solutions

Some got compared size opportunity and these And scale-up. build the as are larger have tremendous of of years. logos, we to initial the engagement to much us to previous for up believe, be able

new So with frankly, happy the we're very sign-ups. logo

Vince Colicchio

And sure this but already, if have, apologize. mentioned if not you you've I'm I

from in and there You're -- to you? would I've that supply this. the the a offset that you increase Philippines, others in Is the is manage case for that's -- that heard agree attrition, through there's -- despite substantial that

Rohit Kapoor

additional through we talent Philippines not continues when if the comes good high the resources in of perspective, operating to got maintain thing That the to carry we're Frankly, a service be availability of to be particular rate recruiting even strong. that as we high recruiting a and to in quarter. Yes. The processes terms from finding entry-level, systems attrition bench Keep particularly is of our in because the place that we've to the attrition of that manage -- delivery it mind carry. we that business, actually and that challenge is pretty manage periods are one trained very the is at able talent abilities. a in in availability of And able we're true. and and

Vince Colicchio

in locations bubbling of? offshore should issues regulatory other any be there we are other up lastly, aware And

Rohit Kapoor

none think that and business settle operating the bubbled this model, I of No. to continue piece around and up. future future to entire going have to that's likely evolve going work But There's down. the it's

provide And the continue will to place evolve definition operate come they'd that. clients flexibility able take evolve model. with employees, think a thing our to go to so be be every to like is, hybrid that of the of up between jurisdiction is and greater for to this as to to along. the how the -- good industry. to for it's growth And it's overall facilities, for I it's going the allow between own likely And its home good will our advantage of to And going workforce we our

settle how terms might in So we of are optimistic this very, very down.

Vince Colicchio

quarter. nice and you Thank

Rohit Kapoor

Thank you.

Operator

from We question Shirvaikar line of have Ashwin a follow-up Citibank. from the

open. is line Your

Ashwin Shirvaikar

should Thank say is we defense? the you. and on agreement, being optionality the this be well. as or credit and recession How of offense flexibility? and at would rising fears defense The was looking upsizing amended bulking up think more question you're just I careful Offense your M&A, being more

Maurizio Nicolelli

become of It's for facility. a that so terms it in We now two our other for The need the wanted November. it. going really to revolver. forward, in larger have But we capital. current is Maurizio. opportunity things. Ashwin. increase increase having redid of capacity with to flexibility for It's it It Hi, in going to terminate also was of really is was going piece became the M&A terms capital operating -- should It we we

company further add company M&A, really and bit organically want the a about inorganically, to will overall That that can leverage so faster. that both forward. much help on we our capabilities grow that and going the talked we mix us little grow the As much that to also suite we company

future. would bit also an to say for that it leverage opportunity ability should for having of that So that it's capital operational in for then both. it, we I it's M&A a need One comes having capacity the little but

Ashwin Shirvaikar

you it. Got much. Thank

Operator

from from your the -- next of question Grossman comes Stifel. David have line We

Your line is open.

David Grossman

I'm Good morning. wondering just of if margin a could couple Thank the that asked. I been follow-up have questions you.

one the October. cycle, guidance you you in typically one that to you the some planning wage I Xst in think When provided provided today? Xst for in pressure you've have mentioned of incremental have year, a what on you're that think April, the wage relative guidance that you of the about

Rohit Kapoor

David. Yes,

and We have years, factored is guidance. to provided higher salary in increment compared a FYXX for our in as that previous

David Grossman

beyond a gone for what you if whether was think through you've wage the I question, will, the year? currently that planning inflation you're provision, extending Rohit, Yeah, as incremental

Rohit Kapoor

that through October gone that at a few a there's opportunity If increment assess So line. cycle, for April. in We months evaluate I relooking have think to just to down need cycle. the be in we'll us that do the David, that, we've an

point So we six line, months this down do it of opportunity. already. At have for and we've an we adequately it adjusted believe planned the for time,

David Grossman

the of the year? you do or gross course course you trend margins? we expect see the How Should relatively over do to expect And movements year? remain expect the some you the of what over to flat do them them

Maurizio Nicolelli

Keep we we are piece April increment an They'll is of bit going do forward. of smaller there's the quarter, piece the Xst onboard. to today, biggest little expenses on where maybe of a Xst. have a and second in similarly mind October then uptake number trend a coming The

both guidance about that's is similar grow it on it's year, it terms our that usually a an to the certain and extent. rest So talked into it. will And be EPS to that's in affects bit revenue today. where of area margin affecting the of the margin going what I But second a little quarter we as on

David Grossman

want So gross Maurizio, margin how or flat and you of should leverage the -- seeing relatively the forward? most about operating margin us about the expenses? going to we that coming operating remaining in market the think think from Is

Maurizio Nicolelli

-- we've see going on think I fairly just comparable I board. in gross forward, margin overall where of expenses the a you'll got you'll think lot business see a coming

of lot a have We ramp-ups.

-- also to guidance gave to, as we the coming going manage adjusted we increments, I expenses to But overall, margin have we're We onboard. that to returned about and office talked you're on operating within that have year what low focusing margin from that's overall the to to back XXXX. guidance the it XX% for EPS. back because going calculate for in And the gets range, the

David Grossman

to calendar but bookings of around bookings, and and pipeline, on backlog, bookings about and any don't basis about thinking like incremental one the all you're Right. last came on talk Rohit, And pace specifics I you in FYXX? earlier how at a up cadence question then that, question. can and a us about year-over-year color know, give you

Rohit Kapoor

David. Sure,

that in growth So first FYXX, of we've in XXXX, number in something the past, that of strength pipeline so twice, clients and large new very the to all, than we used which up spoken results exist that's feels about revenue pipeline in up more The good. a did previously. sign and gone that's

So that's very been strong.

the Our so convert. our we healthy we win good ability have very in a and rate win rate, is feel to pipeline that about very actually opportunities the

and With and the into the quality the the shortening of backlog, looks of the the pipeline, sales business cycle deals pipeline, larger the coming pretty momentum solid.

qualitative it's healthy. So from a standpoint, very looking all

David Grossman

much. Got Great, very thanks it.

Rohit Kapoor

you. Thank

Operator

Robbie from Last line question Baird Bamberger Capital. of comes from the

Your line is open

Robert Bamberger

outsource Solutions outsourcing trend they that tougher and for guys I hiring a you themselves? can't more Thanks seeing starting to given accelerating are Analytics but selling environment? with attrition seeing taking my question. this deal too, companies because employee Are towards guess Digital you point are big

Rohit Kapoor

Robbie. Yes,

I of which face. clients think most our reality a that's

just talent therefore, their them. leveraging seeing for need seeing becomes business think -- and their enabling scarcity. you getting into data, with a a clients partnering changing for growth like if digital providers clients, necessity and transformation, business EXL models, seeing model, areas, They're and they're a Our with about they're new strong

EXL, becomes that seeing difficult are the our for it and clients, talent of in are markets like Many which to in leveraging recruit imperative take place. operate and particularly our we U.S. yes, finding strategic So them. in Europe, Australia in we UK, the and partner an

Robert Bamberger

Thank just Yes. one And you. on inflation. then follow-up

you've clients raise been new just for your environment? easily able and existing how this to given pricing have inflation So

Rohit Kapoor

which, from of environment, being operated it's the our So and with client obviously this. clients change in the right the can dialogue are them and provide absolutely the We've continue sure necessary raising look, to we an appropriate This of the right previously. But by I this through right something, the be commercial arrangements done entire sustainable talent, pricing with is the that started And important. experience. in so terms them a are with for right industry easy. we skill sets working tenure think, a client. way in It which is and that partner kind making and strong is is never

of management. a it's a bit So change

work that the is clients very are the them for do ability higher Our the we And complexity that our we demonstrate advantages to is spectrum. transparent. value our for that on generating

for an conversation be something is we So easier clients. our increase the with therefore, price asking will hope which

Robert Bamberger

you. Thank Great.

Operator

for you today's concludes call. the all Thank Thank questions. you all conference This joining. for

disconnect. You may now

ExlService (EXLS) 28 Apr 222022 Q1 Earnings call transcript