Concentrix Corporation: Off-shore moves, reallocation of spend impacts F2Q; PO moves lower to $26

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Concentrix Corporation: Off-shore moves, reallocation of spend impacts F2Q; PO moves lower to $26

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Concentrix Corporation

Off-shore moves, reallocation of spend

impacts F2Q; PO moves lower to $26

Reiterate Rating: NEUTRAL | PO: 26.00 USD | Price: 20.60 USD

Navigating a tough operating environment 30 June 2026

Macro and customer specific issues impacted F2Q results. The company saw a Equity

continued acceleration of mix-shift to offshore locations, which now represents 300bps

of headwind (vs. prior expected 200bps). Exiting F26, mgmt now expects 11% of its

Key Changesbusiness could be a candidate to move offshore in the future. Having programs move

offshore initially negatively impacts margins given duplicate costs. We expect this (US$) Previous Current

impact could last into C1Q27 depending on the timing of these moves. Concentrix also Price Obj. 32.00 26.00

saw some clients reallocate spending away from certain end customer segments which 2026E Rev (m) 10,141.5 9,975.3

impacted Concentrix’s revs; however, mgmt sees underlying volumes as mostly stable. In 2027E Rev (m) 10,214.7 10,035.4

our opinion, weak macro and headline risk from potential Gen AI impact remain, while 2028E Rev (m) 10,390.1 10,103.5

the introduction of CNXC’s Gen AI based tools and low valuation multiple help offset 2026E EPS 11.51 10.97

some of the concerns. Reiterate Neutral rating. 2027E EPS 12.50 11.78

2028E EPS 13.49 12.73

Guided lower on accelerated offshoring & spend pullbacks

CNXC guided F3Q rev/EPS to $2.48bn/$2.71 (mid-pt), below our/St prior ests, and Ruplu Bhattacharya

lowered F26 rev/EPS guide to $9.98bn/$11.01 (mid-pt). F26 revs are now expected to Research Analyst BofAS

grow +0.75% y/y in CC at the mid-pt (vs. prior guide of 2.25% y/y CC).