Earnings call transcript Q3 2022

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Bin Chiang

Good afternoon everyone. Welcome to Grid Dynamics Third Quarter 2022 Earnings Conference Call. I am Bin Chiang, Head of Investor Relations. [Operator Instructions]

Joining us on the call today are CEO, Leonard Livschitz; and CFO, Anil Doradla.

we the remarks, questions. to prepared their will call open your Following note, recorded. being conference Please is today’s

Before I includes earnings the discussion some to will with financial we the that filings and release of contain everyone begin, outlook SEC. uncertainties statements the forward-looking and would your like risks questions. other statements. are answers and Company’s This the our Such and remind business to to subject today’s in described

performance. discuss in certain with non-GAAP non-GAAP release During GAAP this our financial provided to reconciliations of are and call, the supplemental and we’ll the SEC. filed financial measures press the information X-K earnings

I Relations can all website. our You described in have section the of the Investor information find just

our With CEO. that, will to turn I now the call Leonard, over

Leonard Livschitz

and million, well performed and record marked quarter Good for was revenue company’s you, you in XXXX QX, consecutive We areas. afternoon, joining this $XX.X record exceptionally today. Thank revenue of the across of another multiple everyone thank the ninth quarter us Ben. history.

Additionally, to profitability. the guidance our revenue with respect exceeded quarter and third our results

surpassed the we a a basis. EBITDA better-than-expected on non-GAAP time target operating gross as and public margin a company, of couple XX% due was of first to performance The margin model factors. For XX% our

strong robust we wins. and with business. XXXX pipeline second, the we logo quarter, both fourth our during customers, very programs; new recent continued across technology the new as with Notably, large witnessed First, with they we client quarter demand witnessed a and of some momentum on to existing enter ramp the in strong

successfully. increasingly provide of the high-quality strengths digital their with partner company engineering. I’m grow well that Customers believe transformation can seeking Grid scalable, are to a more initiatives, and is to we’re and as for positioned strategic viewed company our confident Dynamics even

locations. elevated, Polish has Poland, leader our talk and a delivery Let’s country, as the business largest our been community. profile second In technology about status in

Gdansk Krakow, Poland, expand Dynamics X and across locations. internships largest function Warsaw, fully cities across the now all Wroclaw. We’re in these Grid

offices, In support substantial addition, great number of Poland’s of our employees. has Ukrainian resulted posting a in Ukraine

During United with Grid Poland and States that highlight corporations, the round discussion This and true during other to of European and business Polish countries. leadership by attracting are Warsaw. a to the to invited high-quality testament institution to academia recognitions recruiting company’s quarter, I’m team lead table happy and U.S. was the Poland to we Ambassador Dynamics talent operating customers, strengths, global visit us is the new such in help in expect who the other

hiring completed are our the payroll. directly we and incorporation on now India, In

augmented couple location delivery the partnered We weeks, Hyderabad with Park leadership one HR, of internships. have our talent. across and of us In for this presence our to expect and of universities in location new our attracting a help office Knowledge in opening and high-quality with the in premium we’re recruiting operations in leading one and

up ramped for others. offer such also in hiring Serbia, each of we In several our We of countries, unique engineering Romania and as countries, advantage growth. these Armenia, global Mexico, talents

our first cities X hired of and office in we expanding while centers relationship group Romania, new and also X we’re we’re with in Romania. quarter, Serbia, the in our the interns During the opening university engineering expanded Armenia in

the thereby a while all we with know, I’m to executed transitioning any proportion continuing delivery couple timely As operate workforce, you past And of over without all significant continue different geography deliver happy disruptions. of geographic manner. spread to our across regions, quarters, a our a flawlessly in projects geographies lowering are we our risks. delivery over in across distributed report model, to Furthermore, projects

forefront the always of has emerging company technologies. Our at been

clients. products the industry, as innovative well and big engineering, large cloud machine data, service IT Within the as one enterprise companies embrace other first of learning we’re offerings to for

our always maintain of keep to our and technology continue the R&D service We at offering. center leadership

transformation team, Officer, support Chief a strategic of number digital growing customer initiatives to Our spearhead with demand. Technical his

have supply as Regarding as we and subject experts life the financial selected in manufacturing, chain, as personnel, well matter science insurance. expertise hired services such verticals to build

made solutions, progress accelerators substantial implementation frameworks, in costs. reduction This initiatives Regarding implementation DevOps, capabilities, such distributed building a targeting demonstrate we’ve industry specific of as IP automation. cloud and customer and Such risks leveraging clearly custom agile, engineering and well the verticals. include as

few you, ones. we witnessed there trends. notable sensitive. quarter, In more the Demand the with that budget to I some share several retail enhanced scrutiny were positive want In of [being] customer clients trends bases with QX, the across

QX. our in invest headwinds. insulated We to in persist expect the majority of to tend programs, more which to macro from revenue-generating Meanwhile, the trend clients continue be

also revenue from in development logo continue QX trends the on expect and new it the based addition, business to In from benefited we QX, our new strength current logos.

commentary. third to segment Coming quarter additional some

Our customers continued the of similar growth, expanded into aggressively our as geographies. support was Technology segment largest QX, our technology largest ramp to quarter, new the to some during and and we the

Financial Our benefited applications. as new wealth tied to healthy, management from grew segment we programs

we discount these a XXX manufacturer, XX another revenues in started specialty retail and chain. a is the control industries, new new Fortune which large one membership-only a contracts climate signed received with is September, that report and X the in third companies. I’m leading automotive quarter, starting logos engagement global consumer to included from We and One we equipment customers added manufacturer; X October. across Logo happy online several momentum, a platform. Fortune

European business expansion.

cybersecurity companies. a progress clients. one During and with number We good our areas. the of is we made Cybersecurity business strategic focus quarter, our a software of European expanded with

In global company. ramp addition, footwear a a with we strong witnessed

large to our manufacturer. new secured truck finally, continued with major home a the Nordic scale improvement we business U.K.-based business with chain. also We And

strong XXXX New business entered across pipeline. We pipeline our quarter non-retail of robust verticals. in demand fourth the and with new logos a

new faster scale as business some are rapidly. customers, front, logo momentum in up, year. witnessing our large willing done new also expect this and more to of logos witnessed we’ve more QX the strong QX they adding On we’re than we in At ramp

our We’re from expect XXXX. programs, contribute expanding within business in and existing meaningfully to we them

to our new our the logos channel. an ability Partnerships. [to role are partnership through In important new attract Partnerships came our] wins increasingly in clients. playing QX,

service We partner also a we’ll largest we [cloud] as our made their AWS, enterprises. Azure, platform, EKS and delivery of the modernization At for IT At specialization launch partners with we’re which Microsoft of on recognized, gold confirm large across number Google [indiscernible] in progress Cloud application, status. have providers. one program, focuses

to with hyperscalers and addition our strengthen cloud digital advanced companies analytics. in we SaaS In and product commerce, data partners, alliances

an component M&A important to our growth be of strategy. M&A. continues

delivery we successfully capital. [concluding] early key September, a raising As locations. In focuses reminder, primary capabilities, our and M&A on customers

of reasons was One M&A. for the raise key this

Our expansion to actively current exploring multiple complemented capabilities, pipeline our geographic is acquisition opportunities robust, with strategy. our and we’re expand

of quarter, intelligence to the some petabytes for reports Dynamics notable on snowflake run During company, we Number implemented projects. global Grid one, and business a proposed, integration delivered data. technology designed

a enhanced met As scalability. and provided resolved data the were management service result, level and agreements users previously acquired data capacity reporting end decisions. large-scale drive This for to capabilities in solution challenges with business the maintenance, all operational company’s observed and

in customer of relevance. through Dynamics dedicated capabilities. dramatically discovery better quality Grid of one BXB tailored key product The cloud leader the increases development in contribution technology to the and experience recommendations global end-to-end products space, suite. Grid tool a conversion then a of core end a was the Dynamics intelligence-driven product and For search product the engineering artificial partner and included onboarding users gives product

we leading a helped modernize At to service firm, primary client the financial the customer portal.

financial modernized unit. provides up more processes The flexibility portal provides and business products to with each integration and and relevant Our also highlights with their a experience services speeds greater end users solution needs. streamlined

helped of information chain system. the about the largest module contractual excessive additional one revenues. module aggregates and in client collecting our and in to service production claims. company, an we cloud-based It’s For stock matches intelligent their manufacturing terms This allows for supply certainly generate management developed against has

let over that, the to Anil? me With details. more will QX Anil, discuss who turn in call

Anil Doradla

Thank afternoon, you, Leonard, and good everyone.

of exceeded on of basis quarter up basis. $XX a $XX.X million X.X% million million on and XX.X% to our and revenue guidance sequential year-over-year range $XX.X third a Our was

our quarter, was pound euro revenue U.S. British dollar. negatively weaker impacted the against the the During by and

currency in largest XX.X% was a represented of constant a on revenues technology strong customers quarter our new vertical, wins. the third basis TMT, basis. revenue and year-over-year where On across growth large across our our basis, recent existing a programs. contribution customers, grew and revenue our from our year-over-year largest we on strength technology better-than-expected grew XX.X% XX.X%, with by XX.X% demand and and of revenue a sequential quarter X.X% our driven basis, logo some witnessed and customer was base The business We respectively. on sequential from

a on more a in with The XX.X% was by macro our second XX.X% Retail, During largely our decreased the grew largest customers, third decline cautious basis revenues of ongoing year-over-year represented X.X% and are concerns. the who vertical some on and basis. sequential driven spending quarter, sequential

these expect of persist in QX to We these some customers. at concerns

the are the mix other of of details Here verticals. revenue

the third The of came XX.X% customer. some on X.X% Our on a grew at at CPG and our in and revenue the basis by from and customers, quarter represented CPG basis. sequential basis growth Manufacturing was and decline year-over-year XX.X% decreased a on sequential our slight a this offset decline largest

across financial a Finance our the of most and finally, basis. witnessed was quarter XX.X% services, banking and our And we other on on sequential X.X% X.X% of revenue, tied and a third a a to sequential basis on sequential grew On XX.X% increased represented growth year-over-year basis. revenue represented customers up of X.X% basis, segment insurance.

employees couple second head the quarter of total a XXXX. a X,XXX and quarter quarter exited reduction of driven was count We X,XXX third count with from the down The of in factors. third by of X,XXX from XXXX head in up

company-wide streamlined a at engineering our First, we bench. level,

basis third said, over partially Second, pace with billable on increased contributed increase the revenue. quarter, second and the to this of moderated align the That demand. to in head a average our in hiring sequential in our the count quarter, quarter

year third XXXX XX% company’s as the head a of on of driven a count end largely was percentage the our mix count year-over-year of second total the quarter from was XXXX, the The of of by and level decline quarter. head and to X% ago remained non-U.S. quarter total down on or the count headcount. greater the At head total XXX compared same of U.S.

Netherlands X,XXX and Eastern UK, locations and offshore, non-U.S. headcount, to XX% Mexico other in which head total was count. Our sometimes or of Central we our as refer Europe, located

XX XX and were XX.X% a customer XX.X%, the top XX.X%, And the concentration respectively. concentration the our In ago, quarter, during was revenues and our from period same XX our quarter, five respectively. five top XX.X%, and and and second top top XX% five In respectively. customers third year XX.X% top was and top customer

the in year of quarter, in quarter. was decline customers a During customers XXX the had which by The XXX business the sequential second ago from our driven December customers XXXX. Daxx, acquired we largely down our and we quarter in commercial total or customers, in XXX

the not a customers reminder, quarter revenue-generating the who customers, As include are the in and only quarter. do inactive count during we

days in in million a or with with our driven as non-GAAP $XX.X sequential basis, or million of third to XXXX $XX.X from in Moving of gross our from or statement, profit year was profit percentage favorable by was income up a from XX.X% in dollar. working $XX XX.X% XX.X%, XXXX million increase The quarter seasonality margin quarter second million combination year-ago quarter GAAP stronger the during XX.X% or ago quarter million or quarter. the of more the the of quarter. $XX.X FX or and and XX.X%, up the in trends from $XX.X the second XX.X% revenue a was million gross up $XX.X the and up On gross

million in levels to from revenue, higher and $XX.X ago of favorable year or sequential of that in in quarter $XX.X second and from stock-based quarter due reorganization, of expenses amortization, or and trends. depreciation expenses of and in terms costs XX.X% a up EBITDA, Non-GAAP million of operating FX flattish EBITDA quarter. revenue million and combination third or of excluded during dollars was increase $XX.X both revenue, XX.X% geographic the XXXX transaction The was related XX.X% compensation, related to the other up the percentage

and or year-over-year million based million GAAP XX ago a GAAP of on per net loss third $X.XX due of loss share $X.X revenue. reorganization of to and $X.XX sequential quarter. XX Our the year levels million shares higher stock-based the in the in levels of a compensation or largely compared and net of on million $XX.X million based in XX quarter was costs, The totaled to $X.XX based per second offset loss share higher shares on of increase by quarter $X.X geographic loss million a or count shares share loss

shares year diluted third sequential XX offset in ago diluted higher million year revenue, ago was the non-GAAP income or were share net net levels share XX diluted the non-GAAP of and for our XXXX million a expenses. quarter non-GAAP higher million million basis revenue a key the higher income million in from shares on the on The was largely of second the comparison in income on increase $X.XX on quarter income quarter quarter. XX diluted the operating levels The net increase levels partially in by reasons to based the based $X.XX non-GAAP expenses. $X.X net flattish operating On per to of $X.XX or of $XX based of in of per non-GAAP shares basis, share compared $X.X diluted or and per million

balance September of our million from in the of to XX, XXXX, fourth in million totaled sheet. and the $XXX.X $XXX.X coming and up up cash second quarter the On million quarter equivalents $XXX Now from cash XXXX XXXX.

During million, $XXX.X quarter, of conducted which share the offering $XXX raised was by a million received company. the and we primary

expectations expect guidance, or million million. on $XX of to $XXX fourth revenue in to revenues this, With our range million the of will the quarter full year to the we to be growth XX% basis. range in million $XXX Coming be XX% a year-over-year $XX to XXXX

EBITDA to be range in XX.X% quarter non-GAAP the in to our million. fourth expect We the or to $XX.X XX% million $XX.X of

million XX million and XX range to XXXX, to share range. share to XQ be million count the XX our basic in the our in diluted XX to For count million be expect we

prepared my concludes take That ready remarks. Bin, to we’re questions.

Bin Chiang

Siegler of Our [Operator Josh Fitzgerald. line Thank you, Anil. Cantor Instructions] comes first the question from from

line Your open. is

Josh Siegler

Thanks And results today. Hi. for question. Yes. taking congratulations my on the

to concerns the your growth you new updated this are new your you logos color slowdown, that ability win provide to specifically on commentary over So are continue uncertain you. demand macro hearing Thank global them driving can from environment, some robust What services? in with to clients environment.

Leonard Livschitz

It’s Josh. be first. you, Thank always to good

right. question, any ask can You

So my multiple revenue growth is of the the that geared industries actually the continues to generation. feedbacks getting toward I we’re in in the expand mentioned dynamics remarks what

kind kind of of or all point to we’re know, we As recession, inflationary other heading pursue a stuff.

about it’s So it where winners all. the more situation, takes

and more partnership that as well vital both – the So we digital engineering, the competition dollar become customer for companies become services we And offer, for product the more fierce. the service revenue securing see those the dollars with at clients. as those for the

Josh Siegler

you as a quarter? us new the Thank that for this expect dive through into color. the we the the And considering margin focus love Excellent. and you of I’d on especially walk out into recent tailwinds geographies. XQ, for deeper your the you strong to building into guidance margin we little saw move fourth Anil, some quarter Can

Anil Doradla

look – you’re really, right? there are We Sure. Well, then there puts when the takes meant quarter, mean, third into right. you fourth were you and quarter, go some and it, at we when had – I – we

the the we pluses, from side, if as the the billable right? FX to some to furloughs. expect of the quarter, on you side, – size continue fewer quarter, having tend see look other we you be On We on to know, tend the Now hours. fourth at tailwinds

seeing going little bit headwinds to be there. you’re So some of a the

going extrapolate actually level of of reason revenue it from onto through maintaining revenue, the other going QX, in when OpEx we the the seeing the conservativeness and basically you have you of there workdays. continue in is Josh, we’re at some of But look to front, that. to And see drop to a the you’re be level of control. kind to could And could see So are – you of some going customers. some terms number EBITDA for flows is QX larger

Leonard Livschitz

If years more wasn’t Josh, is Yes. obstacles very [indiscernible] strange I will than few public to It actually more XX/XX Board and accomplish ago. IPO deal that deliver. just I large, comes heading inspiration that. to growth, add, normalizes, goal X.X companies to the was the by to I giving a and time. QX when The the were can result, the then, of hitting that’s when we guidance want able our the gave stable be, what we community think just show, to When we world where want to were time over bit to where we the we be. a that’s but lot little we a

Josh Siegler

very Thank Great. you much.

Bin Chiang

question. your Josh. you, Thanks Thank for

go of comes Citi. Potter from Next Please question Ryan from line the ahead.

Ryan Potter

instability Thanks infrastructure recent I and blackouts, the of Ukraine seen guys. client taking terms some the for utilization headwinds all? productivity my Hey, Ukraine there plant your want on has by in in with with of have and at conversations start escalations you impacted incremental question. to and that and or situation any touching

Leonard Livschitz

Right.

hurriedness is the it to whole for need the safe. be we But answer the October. when is not activities. the in about the be being too is infrastructure no, season, Months in a which but We, ahead, did So twice have during wood, on bit Russians Ryan. we answer, know we right? Europe, where are lot centralized of simple this would we short people called preparing prepared months There and during been, heating Eastern of time what course, attacks war, knew our more to a knock stressed situation, the advance, little of were

plan throughout over even November, offices end micro Other country. nine Internet to We then services. and supply, up StarLink control more autonomous and which connectivity add the [indiscernible] generators, further them food by are of adding of water supply, providing actually power to the We’re just the

location by of business and we enterprise largest parallel you reduced blessed So at call. Today, comfortable the are There our future. we the business, never start-up we’re number. Ukrainian operation. be little in we by smaller how in are It’s shape. have are driven so acquired greatly the of to know been we businesses from Daxx, we drive of large, happen some by but the from companies, a to people. of say prepared, in what bit dependency size has more – companies, you But more to relatively But what’s look commercial, the the going better still if good smaller

Ryan Potter

of seeing? the Got of on and to in hear. more kind or you vertical, touching kind an industry of is you theme than the led is Retail, it. seeing trends specific the for cost change overall And focus on client you’re TMT like has vertical Retail in any hiring then provide particular, like it the good verticals you’re particular, your that could to TMT, clients? trajectories That’s with just have softness and freezes overview or And

Leonard Livschitz

Well, we’re Retail retail. is immune. not

it lessons stores. lot during the such relationship days we department we and As are took our our seriously. COVID period incredible us for not much as with Majority on stores, learned decline short time of very a of with dependent customers retail of of an early brick-and-mortar

So the bit forget a a we’re savings. the recession planning into so there is X holiday the They close sequential a same years, to years driven And efficient. putting they are cost to more years same there don’t plus, who decline season. is there ago, less little were are ago go are mode, the affected. [indiscernible] time, X suspects restrictions, usual by suspects, At X

Difficulty] but do, very another revenue are again, point Retail, to work scaling we is the related the driven we of businesses. some We period features other we’re it’s majority time, generation. by that to important expect compensating And last [Technical going on

critical faster industry still have. retail intact, we chest the we’re means core in and I you expectations the back, will comes say team gives customers. cases, we But when we rebounce found many particular wouldn’t the in those So more the remains which most supplier –

Ryan Potter

Got it. Thanks again.

Bin Chiang

Thank Ryan. you,

from ahead. comes from Next go Nolan William question Blair. Maggie Please

Maggie Nolan

projects a Hi, of Can maybe of of to terms type thank topic base now type couple working follow-up ago talk in on to your clients it a looked any years you. with client little retail what you’re you’re Maybe of about that in on? that or the you working the last that differences notable bit. like how compares

Leonard Livschitz

Yes.

by well So you communication. now know quite we’ve in been constant and us

client critical management, supply, on the some from So the rebalancing logistics, price the path etcetera, relationship optimization, retail etcetera. pricing, areas factors, of comes chain efficiencies supply analytics key on data

relationship areas general in So of we the those of number brought actually it on and were down in or clients, modernized right? the stores. to reducing distribution from for relationship. a When Europe. impact, comes these the had in time, of we painful both our layoffs, very So their clients, the clients to be tend retail, to during Difficulty] they more [Technical overall U.S. example, the key by COVID of the And the terms shut of revenue minimizing

have distribution think different, notable, people of some number employees let see a Mexico thing, as to a is And which with retailers. particular, had better to is different. subtlety, are base, Indian of with as the fewer such employers, offshore. U.S.-based massive contingent be – Other go started it’s again, but employees. noticed, There Jamaica, We the it. is a but it the product So that. we in we retailers, you’ve comes focus adding don’t we also of nearshoring good from it’s with I it’s and it and again, lower But and cost

from we client relate type to base, of the only So, when prepared base, the but not from product efficiency we clients. cost are the retailer

Maggie Nolan

then That’s a efforts to the And you coming to Thanks. to? these going just engineering bit And little the you very referred follow-up streamline bench, can is then my are Leonard. elaborate continue on what into did helpful, question Anil quarters? as

Leonard Livschitz

Yes.

tools. to the we relates QX some those the catch of some when of kind up exited So, of to was Russia QX bench transition from

So, that one was area.

the other we to We course, to so time, be and a and we a less do matter to to which all subject incredible across others. for us There at, quite it’s Poland, bench storm partnership bit. at The which the is programs, an are Ukraine university We time already Mexico, internship the relevant the skill more continue in development, to Armenia. investments, project have in into be other for for same recession efficient. Romania more invest we signed our that area But much is investment upfront proposals. tend and into preparation sales look perfect There obviously, and innovation with the everywhere our R&D, into believe again, set, we and of countries, India the including expertise.

which So, as on remarks, the question mentioned very group, think the it for winners to it in time, in first business. peer our think where come I to but I one thing reiterate it’s all, our clients was, I our important the answering take is also relevant

organization having keep science one customer So, just capability, stronger capability and efficient like a consultancy adding pharma We great more big more It’s with front-end architecture just and life customer. entry. coming. had

acceleration. have is two an we customers. the Now, doing quite This That’s factor.

when look total the at thing. So, headcount, one that’s you

sense one, were here, also from some We other had it’s former There which to Daxx, because were relevant. the which virtually parties. clients of pre-acquisition is both had time, not relationship but we The continue some were or renaissance made not mutually or headcount. commercial no reduce the relevant decided noticeable several customers, because they to we old which for which replace less

it employees a at you decline. But at a modest overall, relevant the if look bench, So, you if you see has grown. and look billable actually

Maggie Nolan

congrats. you That’s and very helpful. Thank

Leonard Livschitz

Thank much. very you

Bin Chiang

Next question Jain from from Puneet comes JPMorgan.

is Your line open.

Puneet Jain

question. my taking for Thanks

when lag stuff got other projects environment. retail when terms sight, So, of verticals, a the gets a delayed? past that like like experience like line consider Leonard, vertical in delayed typically line of duration on or What’s like the gets work projects given your sight that how your with much those clients macro or in back work, of should maybe like the based on the typically come of the delayed? What’s we

Leonard Livschitz

that. Somewhat savvy with

as which more happens temporarily. few some, term of not So, them Most be there declines, some are may notable longer material.

So, be ourselves because into our because project has keep leadership we get can’t to just but guarantee wait returned, we their the make senior the we to sure continued obviously, not with bench the businesses conversation for miracle will right. continued, want only to

And the provide. we they it’s our to negotiate in But core what to So, area, of projects. retain from past the as And understand earlier, are the mentioned alternative critical we cases, declines, I recessions like more then maintain team. their and that’s There time, workforce. most we continuity. some find some very would customers Puneet, and critical

them of be still If big will as India said, regardless area you we key contentious at from geographies, you shifted pressure are the the of of big your much remain look very many good the one right. the good standard are fairly one sigma of across by all people a to is guys company value are you the discussed perspective, sophisticated it and small client In technically the be other more because words, of to will to will our be the deviation location. of and

some the earn, course, small difficult we be when to cover Dimon about That for a we dollars, confident. distinguished the But little to our the debt we industry of money, is have. regardless very your Jamie color leverage group because So, with they in of how many that challenges, provide discussions bit are we a are gives By debt business. because the would than one that need with small of the dollars world bit was leader, with thinking QX And us into a way, the I by yesterday, was more clients. owe covered there there end we this are to of to entering more all that probably points the my by I be conference approach other to saying which account a ever. ourselves. to resonates United much States our more people, shielded And savings the he able we need period undertake. privileged We and more spend the people with built

Puneet Jain

layoffs is it tech strong How or more growth companies. of And of strong saving Like to like the should doing the the instead like of those be? then tech in some projects you for what’s you about that’s Is that your do that’s projects growth for at prove technology that’s like to the we changing that vertical see news clients, driving around it was impact? clients? of transformation digital flow them cost large just maybe hiring work can vertical, are being for like that despite vertical, do freeze, maybe your like all you the think second, defensive driving type how or within so great nature the it of past. for relevant work defensiveness And the

Leonard Livschitz

to I want anger customers read Well, that They into are my going transcripts well. lot to I go to am a probably details. of don’t big going the as

say the not a am are in kind of [ph]. the world. I best cheap to guys That’s my going So, topic

We very have them. know important past of most of some capable I earnings into I – turns cost kind the days, The guys. part, some team. read savings see tier the from big few don’t and that the most I are other in calls there of high

there, cost capabilities. operational saving the course, Of is mainstream it’s but all about

I where chain about and handsets of when the logistics. talk the headsets articles, – what’s lot works customer, the largest supply it one how a of there So, is produced the and are

of elevated those Also, way elements. very to a kind senior been people. we of very We humbled, been have front have level

growing. contributing because, decision-maker, take to scary again, those project, multibillion-dollar very when and it’s very we they but technically of to are it strategic get large the are elements, elements you this seriously front Sometime

So, I on for would not cost say the a are development we defensive savings.

And relates do. their manufacturing, their logistics, the that’s to think are, I what areas. chain, areas, key elements, optimization again, driving just the which supply necessitate which we e-commerce, today we

still challenges, I So, what elements forever, talk digital involved. very unwavered. which believe are bullish our that can is to these But be all core remains value we there,

Puneet Jain

you. Thank

Bin Chiang

you, Thank Puneet.

go Bryan from question Please from Next comes Bergin line Cowen. the ahead. from

Bryan Bergin

Good guys. and Hi you. thank afternoon

citing that had here am of programs the engaged it are you priorities programs were that relates clients, revenue it logos these in them, existing I you your these new growth different any engagements the there. generation the efficiency momentum curious, are you with versus So, as relative strong and new to typical base those good initiatives? to is with new

Leonard Livschitz

it’s later tried in queue, this to the from several But know answer the respect be I where Bryan, times. Yes, already it. disadvantage to question I coming and I Yes. right.

asking revenue it’s how It’s different. business call We us specific the But very they they beyond was is the for linear I assure to have being have to would their generation. don’t for are generated services sensitive something I – just senior what how because the they different into way those think do I leadership this. revenue is get not revolutionary to are of some the to provide generate portion of from before. divulge you doing a how specifics of very very suppliers the strategies. plenty clients notable because efficiency

what done other as in truly really have it’s So, we businesses well. aligned some

Bryan Bergin

visibility that current have, it business this guideposts? about Okay. year early versus And just then any as year? typical you XQ, different right indications beyond is at in of the you now think any a Any talk the stage

Leonard Livschitz

for Yes. been have prepared I that.

You already in right. asked this question today, earlier conference my

the could We to ask half to of starting next question. I growth sorry, repeat isn’t. year second Anil see – increased will So, a of revenue the pleasure profitability and to the return be the

see we that to say to similar trends. not I But ask you. So, you

modest Again, are variance little reason few it with we from we December season terms out a may variance a a very can have [Technical we of make big to we around company unusual the came impact. Difficulty] and bit the In smaller company in an you’ve the done of is bit for with still QX noticed a furloughs. even us. holiday And QX, have a of there visibility is because sequentially. It’s QX decline

there are in surprising of XX% for very because not, money are will that streamlined, innovations not was about will but Thank I you sales, Anil, we innovation. conservative. that for be but And technology the years, am conservative. I believe, I have battlefield all for was way a mentioned why as useful over with And have I very well, work talking god you SMEs, you XX% It limit M&As, never implying for They some are But our I guys aggressive. the before Leonard optimism, many So, say what well. are we In like now the to the not company QX. quite that believe fight because marketing, Livschitz. better have numbers remain Again, we ground prepared to customers dared XXXX work in more somewhat my makes doesn’t too for year-over-year. guidance, you goals ground for anything do my the and short-term What QX would tactics, this for my both that’s XX% come year-over-year, into tight crazy I very, for as are us. we much our But soon. are. competitive have I

Bryan Bergin

Okay. makes It Thank you, sense. guys.

Bin Chiang

Bryan. Thanks

from Needham. from comes Mayank Tandon Next question

Go is Your ahead. line open.

Mayank Tandon

to some what the to drill see wanted sort Leonard. in demand? And sooner a around see I demand? start have of ramping in quarter? trend all up back improve, just of able when maybe am are utilization. recruiting line we lumped was up couple Anil. to is recruiting Hi do Where in much expecting guess hiring how So, terms What is into to the of in getting maybe start given that be at I of plans. you really you meet do when demand questions ramp utilization Hi, moderation maybe then and you current it I the to

Leonard Livschitz

Right.

answer to numbers, and me right. have the I easy the Anil with Let struggle part

hard So, slowing strategy. areas, for to the It’s continue regional push of not in very modified recruiting has the where been terms we the are ramp just down. growth. There been

the One example of is notable India.

required can they to know for that before You people contractually several job. the stay change are months

being those So, are offers made.

another will believe push So, though of then prep we because down level churn, kind those that good high next quickly. we places example, to out. run we And don’t year, with very people of a want technical we early to Poland continuing we are roll that training. need run and see of obviously, to need for definitely part – I there, expedite is to unintelligent the very

but bit see gap not a insurance, only for hiring you So, we this we little are because of are the bench. planning

become as going a my the we of of Now, inspiration significant become revenue more intelligent bigger, is increase because we company. to the to needed

passes, your the of – to play zone so, of catch in to need long throws, bit right, little we a So, little competitors.

So, we need to run very prepared the new capabilities.

we slowed not So, have the bottom strategic the down on hiring. line

training down of not slowing are We people. on the

readjustment see that in workforce competitive locations scaling You And the hire various is to another of thing before. more just see. are can so of on so better of of hiring, much course, we same we the

three adding We want planned time that I But countries. save sensations yours. the way the of in months, new otherwise floor in Again, ahead will now be we is But too various well. to boring. some locations as

Anil Doradla

Yes.

So, the prepared we utilization billable I Mayank, so went all a up, and Net-net, of headcount did comes my our talk this to about In talked when relative of moving and bench quarter, quarter. the lot it trended it about going utilization comments, to last up that, parts. up.

Mayank Tandon

there side, is Alright. pressures, the talk supply could seems of does some some tend moderation you just supply that, just to given And the then again, demand be to maybe in ease that a about so, where to turning help expectations inflation you that? your might maybe face do ease think wage attrition the maybe today, around slightly also start in And demand? which bit, of profitability little should to slowing

Leonard Livschitz

Again, it’s interesting.

strong. not business, right. continuing be you On at some and behavior is the softness, the starting some demand to during Demand there cyclical QX is the existing QX, slowing. is of look If in

difficult So, of just right. task more than reallocation of assets, there even flat, is that’s right. kind And

well. doing we So, are

the experienced, we’re comfort some some newly with we is for tremendously. hired, of well, terms that is are the little again, a other In reason attrition to helping region, a people no lowest leadership of regions, level, in this. the advanced In we anticipate regions, team. are There run. very supply as people probably places, of one there bit very attrition people voluntary newbies In other certain

to people other different to employers. from us So, walking any if see are of the to we going are be kind

Anil? [Technical feel at do this Anil, comfortable very color any you I So, have on Overall, the Difficulty]. point now.

Anil Doradla

number it, quarters, Last obviously, point involuntary are some from down. of as a of it went voluntary couple directionally, as was voluntary view some but nice this going view, Leonard we out, a a we out to moved from of had not point of of But drop places. So, we quote component, pointed quarter.

Mayank Tandon

taking so for Alright. much Thank my you questions.

Anil Doradla

you. Thank

Bin Chiang

closing the Thank point, Leonard more for the comments. today. in you, will now session queue. That Mayank. Q&A be of the no to all have the for At questions we will pass back this call I

Leonard Livschitz

us Thank on you today. joining everybody call for the

to Our company’s customers solid and and resilience. results performance incredible strong highlight our value

you Our expand track continue Thank continues update see successfully early look will enterprise delivering reputation relationship business company our customers. to next to in giving the that XXXX, complex the with a strong momentum, I we engineering to a is as I of our our of projects provider driving as global you. confident course forward am high-end growth. year. large record and and

Bin Chiang

concludes so participating. this call. Thank for gentlemen, and Ladies today’s you conference much

disconnect. now may You

Grid Dynamics (GDYN) 3 Nov 222022 Q3 Earnings call transcript