EPAM Systems Q1 Earnings and Revenues Beat Estimates, Stock Up

EPAM Systems EPAM reported first-quarter 2025 non-GAAP earnings of $2.41 per share, which beat the Zacks Consensus Estimate by 6.2%. The bottom line decreased from the year-ago quarter’s earnings of $2.46 per share.EPAM’s earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, with the average surprise being 8.32%.The company's first-quarter revenues of $1.3 billion surpassed the consensus mark by 1.37%.EPAM’s top line rose 11.1% year over year, demonstrating an improvement across its business segments, primarily benefiting from its latest technological innovations enabled by Gen AI.Following the company’s stronger-than-expected top and bottom-line results and a solid earnings guidance for the full-year 2025, EPAM shares gained 12.88% in Thursday's trading session.EPAM Systems, Inc. Price, Consensus and EPS Surprise EPAM Systems, Inc. price-consensus-eps-surprise-chart | EPAM Systems, Inc. QuoteEPAM’s Q1 DetailsEPAM’s year-over-year top-line growth was driven by the performance across its industry verticals, such as Financial Services, Software & Hi-Tech, Life Sciences and Emerging, partially offset by softness in Business Info and Travel & Consumer.Revenues from Financial Services (24.1% of total revenues) were $314 million, up 29.3% year over year.First-quarter revenues from Consumer Goods, Travel and Retail (19.6% of total revenues) were $255.5 million, down 1.4% year over year.Revenues from Software and Hi-Tech (14.6% of total revenues) in the fourth quarter were $190 million, up 10.5% year over year.Life Science and Health revenues (11.9% of total revenues) were $155 million, up 10.5% year over year.Revenues from Business Info and Media (12.5% of total revenues) were $167 million, down 2.2% year over year.Emerging revenues (17.8% of total revenues) were $221 million, up 22.8% year over year.EPAM’s non-GAAP gross profit increased 5.7% year over year to $374.2 million while the gross margin contracted 170 basis points (bps) to 28.7%. (Find the latest EPS estimates and surprises on Zacks Earnings Calendar.)The non-GAAP operating income witnessed 1.3% year-over-year growth to $175.8 million. The non-GAAP operating margin contracted 140 bps to 13.5%.EPAM’s Balance Sheet & Cash FlowAs of March 31, 2025, EPAM had cash, cash equivalents and restricted cash of $1.18 billion, lower than $1.29 billion as of Dec. 31, 2024Long-term debt was $25.1 million as of March 31, slightly lower than $25.2 million as of Dec. 31.Cash flow from operations was $24.2 million, while free cash flow was $14.8 million.EPAM’s Q2 and FY25 GuidanceFor the second quarter, EPAM expects revenues in the band of $1.325-$1.34 billion, indicating year-over-year growth of 16.2% at the midpoint.The Zacks Consensus Estimate for second-quarter revenues is pegged at $1.28 billion, indicating year-over-year growth of 10.2%.Non-GAAP operating margin is anticipated to be in the range of 14-15% of revenues. Non-GAAP earnings per share are expected between $2.56 and $2.64 for the second quarter.The Zacks Consensus Estimate for earnings is pegged at $2.27 per share, indicating a year-over-year decrease of 7.7%.EPAM revised its guidance for full-year 2025. It now expects revenues to grow in the range of 11.5% to 14.5% from the previously initiated guidance of 10% to 14%.The Zacks Consensus Estimate for revenues is pegged at $5.27 billion, indicating year-over-year growth of 11.4%.Non-GAAP operating margin is expected in the range of 14.5-15.5% of revenues. Non-GAAP earnings per share are now expected to be between $10.70 and $10.95, up from the previously estimated guidance of $10.45-$10.75.The Zacks Consensus Estimate for earnings is pegged at $10.49 per share, indicating year-over-year growth of 3.4%.Zacks Rank and Stocks to ConsiderCurrently, EPAM carries a Zacks Rank #4 (Sell).Amphenol APH, Juniper Networks JNPR and Upwork UPWK are some better-ranked stocks that investors can consider in the broader Zacks Computer & Technology sector. APH, JNPR and UPWK sport a Zacks Rank #1 (Strong Buy) each at present. You can see the complete list of today’s Zacks #1 Rank stocks here.APH shares have gained 26.4% for the past year. The Zacks Consensus Estimate for APH’s full-year 2025 earnings is pegged at $2.62 per share, up by 4 cents over the past seven days, suggesting a growth of 38.6% from the year-ago quarter’s reported figure.JNPR shares have gained 4.8% in the past year. The Zacks Consensus Estimate for JNPR’s full-year fiscal 2025 earnings have been revised upward to $2.09 in the past 30 days reflecting a year-over-year growth of 21.5%.UPWK shares have gained 38% over the past year. The Zacks Consensus Estimate for UPWK’s full-year 2025 earnings is pegged at $1.14 per share, implying a rise of 9.62% from the year-ago quarter’s levels.Zacks' Research Chief Names "Stock Most Likely to Double"Our team of experts has just released the 5 stocks with the greatest probability of gaining +100% or more in the coming months. Of those 5, Director of Research Sheraz Mian highlights the one stock set to climb highest.This top pick is among the most innovative financial firms. With a fast-growing customer base (already 50+ million) and a diverse set of cutting edge solutions, this stock is poised for big gains. Of course, all our elite picks aren’t winners but this one could far surpass earlier Zacks’ Stocks Set to Double like Nano-X Imaging which shot up +129.6% in little more than 9 months.Free: See Our Top Stock And 4 Runners UpWant the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Amphenol Corporation (APH): Free Stock Analysis Report Juniper Networks, Inc. (JNPR): Free Stock Analysis Report EPAM Systems, Inc. (EPAM): Free Stock Analysis Report Upwork Inc. (UPWK): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks