Q2 2024 Globant SA Earnings Call
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No one was founded.
With the idea.
Bring opportunities for people.
<unk> in Latin America, with Great technology, and demonstrate how good they can be 10 years ago or friends, who dreamed of bringing technology from Latin America to the world embarked on a new mission.
Speaker Change: <unk> listed on the New York Stock exchange when he said it the robot.
Speaker Change: Says we like to.
Speaker Change: Really big warehouses.
Speaker Change: Firefox Natus more room.
Speaker Change: And so Oh, probably we are building something different.
It was.
Speaker Change: Something that's kept us like we have very clear in our minds and it was a way of starting showing the brands are so that was right and after years of preparation they were ready to ring. The most iconic bell in New York.
Speaker Change: And finally, what's a very long process. It took four years something like that and in 2014.
Speaker Change: Part of being public and the New Yorker suddenly changed the ferrous technological Latin American company to go public and decide.
The motion that about that.
Speaker Change: That is because we have been building this company with so much love and so much compromised central lunch, we give a lot of us in this company on an everyday basis and it's not something come on in the in the pressurized carrier or finance people to vote.
Speaker Change: Plus processes like that whats next for these great players what other challenging dreams do they have in mind, we will not be happy with less than becoming the best company in the world doing what does it do it for me.
Speaker Change: One thing is Sir this is just the beginning.
Speaker Change: Global technology that bears to delight.
Speaker Change: Yeah.
and Entrepreneurial Culture.
Speaker Change: [music] Good day and welcome to <unk> second quarter 2024 earnings Conference call I Am Arturo Langa Investor Relations officer are going well.
empower us to build long-lasting relationships with our clients. Over the short and medium term, generative AI presents us with a massive opportunity. We haven't seen this scale since the smartphone revolution in the late 2000s.
Speaker Change: All participants on this call will be on listen only mode. After today's presentation there'll be an opportunity to ask questions kindly refrain from racing hands as will aim to address a select number of questions to ensure efficiency.
Back then, users demanded new apps to interact with their preferred brands. Companies everywhere reacted to meet consumers' demands and kick-off multi-year digital transformation programs, many of which are ongoing today.
Speaker Change: Please note. This event is being recorded and stream lives on Youtube by now you should have received a copy of the earnings release.
Have not a copy is available on our website investors <unk> com.
Currently, we see Gen-AI tools quickly being adopted by users. The barrier to entry for building AI has been lowered, but creating enterprise-class solutions that are effective beyond a demo remains a challenge for the industry.
Speaker Change: Our speakers today are multi Amelia co founder and Chief Executive Officer, one of Gary's, Chief Financial Officer, but the DCF armies, Chief operating officer, and the hotels on a global Chief Technology Officer before we begin I would like to remind you. That's all the comments on our call today may be deemed forward looking statements. This includes our business and financial outlook and the answers to some of your questions.
Generative AI has brought significant gains in productivity and efficiency of development. However, history has shown us that after every massive tech breakthrough, user demands more from the brands they love.
Speaker Change: Such statements are subject to the risks and uncertainties as described in the company's earnings release and other filings with the SEC.
Speaker Change: Please note that we follow <unk> accounting rules in our financial statements. During our call today, We will report non <unk> or adjusted measures, which is how we track performance internally and the easiest way to compare to launch our peers in the industry you will find a reconciliation of <unk> and non <unk> measures at the end of the press release, we published on our Investor Relations website announcing this quarter's results.
This pushes companies to go further. The scope of their ambition increases.
and they need to create the expected AI-based experiences that the users demand.
Many of those were impossible before, and they will trigger the next generation of projects and programs.
multimillion arceo: I'd now like to turn the call over to multimillion arceo.
Good afternoon, everyone. It's my pleasure to be back with you Hey, how are Ya digital maritain. Thank you. So much enjoy your holidays I would take it from here.
Global: We firmly believe that the net effect between these dynamics fosters a positive future for our industry. At Global, we acknowledge this and we are ready to adapt and win.
multimillion arceo: Good afternoon, everyone. It's my pleasure to be back with you again.
Global: AI-related revenues are growing close to 130% in the first half of 2024.
I'm, giving it will disturb break through my digital twin and this quarter, we're changing the format of our earnings call, we would be more concise in our remarks.
Global: versus the same period last year. During the first half of this year, we have produced over $150 million of revenue that included AI workloads.
multimillion arceo: And leave more time for discussion with our analyst community.
multimillion arceo: The law remains committed to our long term growth.
Global: far above the hundred million dollars in revenues that we reported in November last year.
multimillion arceo: We continue expanding our market share at this important time for our industry.
Global: This quarter, Globan also presented its own AI agents to enhance the software development lifecycle.
multimillion arceo: We aim to be the leading innovation partner for our customers as AI Revolution continues to expand.
Speaker Change: I will begin with our quarterly results Q2 revenue totaled $587.5 million up 18, 1% year over year, and almost 3% quarter over quarter.
Global: Having invested for years in our range of AI platforms, which include Augur, Magnify, Navigate, GeneXus, they now form the backbone of our new AI agents.
Global: Augmented and supervised by humans, the agents will accelerate each stage of the development process, including product definition, backend prototyping, design, code testing, and code fixing.
Speaker Change: This growth was sure across the geographical regions and industry back the Gulf, where we work.
It included a significant step forward with our top customer and our media sports and entertainment vertical we.
Global: They will assist from designing individual tasks and interactions to understanding users' goals and crafting experiences that seamlessly guide them towards the desired outcomes.
We continue to de lever in profitability forecasting EPS growth, while maintaining a healthy balance sheet.
Global: We're also keen to announce our growth in the marketing technology space.
Speaker Change: We're improving our margin outlook for the ear racing both our adjusted operating income and adjusted EPS.
Speaker Change: At the Cannes Lions International Festival of Creativity this summer, GloVan presented our new GloVanGUT network. It combines our previously acquired advertising organizations with GUT, the award-winning global creative agency.
Speaker Change: Well with tourists and profitability have eroded across the I T services industry in recent years.
Speaker Change: <unk> sustained them, while delivering industry leading growth.
Speaker Change: The new network offers a one-stop shop for marketers, leveraging the best of global creativity, media, and technology. I'm also pleased to announce that IDC recognized Globant as a leader in the latest market scape for the media industry.
This quarter also marks a special milestone for us.
Speaker Change: We have reached our 10th anniversary as a public company.
Speaker Change: Since our IPO, we have delivered over 18, 100% in shareholder returns and Phoenix revenue growth.
Speaker Change: I'm excited to invite you to our annual signature event, Globe and Converge.
Speaker Change: At a compound annual growth rate of 29 point.
Speaker Change: This year, it will take place at the new Intuit Dome of the LA Clippers in Los Angeles. Globan has been behind the technologies that will change how live events are experienced.
Speaker Change: 6%.
Speaker Change: This was made possible through our always in better mindset.
Speaker Change: Our digitally native and into burn area culture empower us.
Speaker Change: It is my pleasure to be back with you again and share my passion for innovation. Recently, I penned a letter to our community to go over our growth vision in greater detail. You can check it out by accessing the QR code on your screen.
Speaker Change: To build long lasting relationships with our clients over.
Speaker Change: Over the short and medium term generative AI presents us with a massive opportunity we haven't seen these scale since the smartphone revolution in the late two thousands.
Speaker Change: But then users demanded new apps to interact with their preferred brands.
Speaker Change: And with that, I'll hand it over to our CTO, Diego Tartara. Diego, please, thank you very much.
Speaker Change: It's everywhere reacted to meet consumer demand and kick off more to ear digital transformation programs, many of which are ongoing today.
Diego Tartara: Thanks, Martin, and hello, everyone. We are focusing our AI expertise on clear and effective use cases to positively impact our clients' businesses.
Speaker Change: Currently we see Jenny I tools weekly being adopted by users.
Speaker Change: This quarter, the AI Reinvention Studio Network has recently closed large deals in Europe and Middle East, connecting directly with CEOs and the broader non-tech C-suite executives. Globent has become a transformation partner not only from a technology perspective, but from an expanding business one.
Speaker Change: The barrier to entry for building AI has been lowered.
But creating enterprise class solutions, they're effectively on a demo remains a challenge for the industry.
Speaker Change: They know that T V. I has brought significant gains in productivity and efficiency of development.
Speaker Change: We continue to lead in our AI offering. Over the past year, we increased the number of data science and AI engineering specialists at Globent by 70% so that we can take advantage of the increasing AI demand.
Speaker Change: However, history has shown us that after every mossy breakthrough user demand more from the brands They love.
Speaker Change: We see an excellent example of these focused capabilities with a leading U.S.-based health research institute.
Speaker Change: These pushes companies to go further the scope of their ambition increases.
Speaker Change: Globent is applying AI and machine learning to improve data quality and make healthcare data research ready. The upcoming phase of the work will be to apply AI predictive models to understand various aspects of patient health journeys.
Speaker Change: And they need to create the expected AI based experiences that the users' demand.
Speaker Change: Many of those were impossible before and they will trigger the next generation of projects and programs.
Speaker Change: We firmly believe that the net effect between these dynamics foster a positive future for our industry and blow them. We acknowledge these and we are ready to adapt and win.
Speaker Change: Among our new AI-powered innovations is Advanced Video Search, a solution we developed with Google leveraging the Google Cloud Platform technology stack.
Speaker Change: Advanced video search detects what is actually being shown in any video on a frame-by-frame basis and provides semantic search capabilities.
Speaker Change: AI related revenues are growing close to 130% in the first half of 'twenty 'twenty four.
Speaker Change: This opens opportunities for industry verticals where Globent is strong, such as media, gaming, sports, and entertainment.
Speaker Change: Versus the same period last year during.
During the first half of this year, we have produced over $150 million of revenue that included AI workloads.
Speaker Change: It's particularly promising for our Sportion division, enabling contextually smart advertising, improving the efficiency and monetization levels for ad companies. Initial projects with clients are already underway.
Speaker Change: Far above the $100 million in revenues that we reported in November last year.
Speaker Change: This quarter globally also presented its own AI agents to enhance the software development lifecycle.
Speaker Change: In our Globens Enterprise Studio Network, we have recently advanced opportunities in the evolution towards SAP S4 HANA that major organizations using SAP are embarking on.
Speaker Change: <unk> been invested for years in our range of AI platforms, which include a war magnify navigate genex's.
Speaker Change: Recently at SAFIRE, SAP's signature event, we announced a partnership with AWS to accelerate businesses migrations to SAP's RISE S4 HANA, their flagship ERP cloud offering.
Speaker Change: They now form the backbone of our new AI agent.
Speaker Change: Augmented and supervised by humans the agents will accelerate each stage of their development process, including product definition, Bakken prototyping design goals testing and cold fixing.
Speaker Change: They also recently chose Globent to co-create an app house, one of their few partner-led additions in the world.
Speaker Change: Our relationship with Salesforce also continues to grow as we were recently certified as one of its few expert-level partners for healthcare and life sciences globally.
Speaker Change: They will assist from the signing individual tasks and interactions to understanding users' goals.
Speaker Change: the first and only expert level partner for its data cloud offering in Latin America, as well as invited to join their global partner advisory board for data and AI.
Wrapping experiences that seamlessly guide them towards the desired outcomes.
Speaker Change: We're also keen to announce our growth in the marketing technology space at the Cannes Lions International Festival of creativity. This summer below 1% at our new global you've got network. It combines our previously acquired advertising organizations, We've got the award winning global.
Speaker Change: In healthcare, Globant is working with a global pharmaceutical company. They came to us because they were looking to establish a unified approach to accelerate AI deployment across all of their business units and regions. We are developing an adoption strategy and an operating model for an AI center of excellence.
Speaker Change: Creative agencies.
The new network offers a one stop shop for marketers.
Speaker Change: a place where they can experiment and test different AI initiatives across the organization.
Speaker Change: Bridging the best of global creativity.
Speaker Change: In the United States, Globant has been named as a digital transformation partner for one of the country's largest privately held companies.
Speaker Change: Media and technology.
Speaker Change: I'm also pleased to announce that IDC recognized globally as a leader in the latest Mark escape for the media industry I'm excited to invite you to our annual see that your event global converse.
Speaker Change: We have blended the expertise of 21 different studios into a complex yet cohesive solution that will execute a multi-year transformation program.
This year it will take place at the new Intuit dome of the Clippers, Los Angeles No. One has been behind that the gala Gs that will change how live events our experience.
Speaker Change: The program will focus on legacy technology and application modernization, cloud infrastructure support, and developing new capabilities to future-proof their business.
Speaker Change: Globant is also advancing our capabilities in providing solutions that bring both business growth and sustainability for our clients. Our offering includes technologies that analyze the potential environmental impact of carbon, water, and waste in corporate decisions.
Speaker Change: It is my pleasure to be back with you again and share my passion for innovation.
Speaker Change: Lee I send a letter to our community to go over our growth vision in greater detail.
Speaker Change: You can check it out by accessing the QR code on your screen.
Speaker Change: They can therefore balance the financial budget and carbon budget of choosing one energy system from another.
CTO gigawatt: And without I'll hand, it over to our CTO gigawatt that will further their.
Speaker Change: This has already been implemented successfully with Rockwell Automation.
Speaker Change: <unk>. Please thank you very much.
Speaker Change: The result is an ESG focus that is quantifiable and impactful and can be melded into the corporate decision-making process.
Speaker Change: Thanks, Martin and Hello, everyone. We are focusing our AI expertise on clear and effective use cases to positively impact our clients' businesses.
Speaker Change: Our Globant G.U.T. network continues to expand. G.U.T. keeps working for some of the most beloved brands and getting rewarded. Their campaign Handshake Hunt for Mercado Libre in Brazil received a Grand Prix at Cannes in June.
Speaker Change: This quarter the AI reinvention studio network has recently closed large deals in Europe, and middle east connecting directly with Ceos and the broader non tech C suite executives globally has become a transformation partner not only from a technology perspective, but from an expanding business one.
Speaker Change: This campaign, where contextual Black Friday discounts popped up on TV screens every time a handshake, which also happens to be Mercado Libre's logo, was shown, is another great example of how technology and creativity are revolutionizing advertising and creating new, effective revenue-driving opportunities.
Speaker Change: We continue to lead in our AI offering over the past year, we increased the number of data science and AI engineering specialists at globin by 70%. So that we can take advantage of the increasing AI demand we.
Speaker Change: GUT won a total of 21 Cannes Lions, confirming another great year for the agency.
Speaker Change: We see an excellent example of these focused capabilities with a leading U S based health Research Institute.
Speaker Change: We are excited to augment the work for Globant Guts array of clients, which include Coca-Cola, Google, Stella Artois, Michael Obaltra, Tim Hortons, FIFA, La Liga, and Mattel, among many others.
Speaker Change: Global is applying AI and machine learning to improve data quality and make health care data research ready.
Speaker Change: The upcoming phase of the work will be to apply AI predictive models to understand various aspects of patient health journeys.
Speaker Change: From two decades in investing at the forefront of technology trends, we are determined to make our mark now that our investments in areas from enterprise to sustainability and AI are coming to fruition.
Among our new AI powered innovations is advanced video search a solution, we developed with Google leveraging the Google Cloud platform technology stack.
Speaker Change: I leave you all with Patricia Pomies, our COO. Thank you.
Speaker Change: Advanced video search detects what is actually being shown in any video on a frame by frame basis and provide semantic search capabilities.
Patricia Pomies: Hello everyone, happy to be back.
Patricia Pomies: Let's start with our clients.
Patricia Pomies: We currently have 19 clients bringing in more than $20 million of annual revenue, and 329 that provide more than $1 million of annual revenue, 16.3% more than one year ago.
Speaker Change: This opens opportunities for industry verticals, where global strong such as media gaming sports and entertainment.
Speaker Change: It is particularly promising for our sports division, enabling contextually smart advertising, improving the efficiency and monetization levels for AD companies initial projects with clients are already underway.
Speaker Change: Our largest client, the Walt Disney Company, grew 11.1% year-over-year and 3% quarter-over-quarter. Among our 20 biggest accounts, the average duration of our client relationships is over 10 years.
Speaker Change: And our global Enterprise studio network, we have recently advanced opportunities in the evolution towards S. E. P. S for Hana that major organizations using S. P are embarking on recently.
Speaker Change: This is testament to Globin's focus on developing true thought partnership with our clients executed through the quality of our delivery.
Speaker Change: Recently at Sapphire SAP E signature event, we announced the partnership with AWS to accelerate businesses migrations to Sap's rise S. Forehand on their flagship ERP cloud offering. They also recently chose globally to co create an App house one of their few partner led editions in the world.
Speaker Change: As of Q2 2024, we see better traction and growth in every region compared to the same quarter in 2023.
Speaker Change: Our best performing region this quarter was Europe, growing 44.7% year over year.
Speaker Change: As we announced in our last earnings call in May, here we were able to land the largest deal in our company's history, made possible by our scale and growth of our delivery network in the region.
Speaker Change: Our relationship with Salesforce also continues to grow as we were recently certified as one of its few experts level partners for health care and life Sciences globally, the first and only expert level partner for its data cloud offering in Latin America as well as invited to join their global partner Advisory Board for data.
Speaker Change: Our new markets region grew by 25.1% year-over-year.
Speaker Change: Latin America, 23.2% year-over-year, and North America grew by 9.7% year-over-year.
Speaker Change: In AI.
Speaker Change: In health care globally is working with a global pharmaceutical company. They came to us because they were looking to establish a unified approach to accelerate AI deployment across all of their business units and regions. We are developing an adoption strategy and an operating model for an AI center of excellence a place where they can experiment in.
Speaker Change: In addition, Globin's global revenue stream is the most diverse it has ever been.
Speaker Change: North America now makes up 56.3% of our revenue, followed by Latin America at 23%, Europe at 16.9%, and the Middle East and APAC at 3.8%.
Speaker Change: First different AI initiatives across the organization.
Speaker Change: Of the eight industry verticals we provide services for, seven are up on a year-over-year basis, and four experiencing double-digit growth.
In the United States globally has been named as a digital transformation partner for one of the country's largest privately held companies. We have blended the expertise of 21 different studios into our complex yet cohesive solution that will execute our multi year transformation program.
Speaker Change: Year to date, all verticals have shown positive growth.
Speaker Change: This quarter, our fastest growing vertical was travel and hospitality, up 58.9% year-over-year. Consumer, retail, and manufacturing grew 38.7% year-over-year. Media and entertainment is up 20% year-over-year.
Speaker Change: The program will focus on legacy technology, and application modernization cloud infrastructure support and developing new capabilities to future proof their business.
Speaker Change: This is on the back of a very strong performance with our top client, Disney, along with our expansion and momentum in sports with work we're delivering in the Middle East.
Speaker Change: <unk> is also advancing our capabilities in providing solutions that bring both business growth and sustainability for our clients. Our offering includes technologies that analyze the potential environmental impact of carbon water and waste and corporate decisions.
Speaker Change: The bank's financial services and insurance verticals showed an 11.6% increase in revenues compared to the same period last year.
Speaker Change: They can therefore balanced the financial budget and carbon budget of choosing one energy system from another this has already been implemented successfully with Rockwell automation. The result is an ESG focused that is quantifiable and impactful and can be melded into the corporate decision making process.
Speaker Change: As of Q2, our total headcount is 29,112 globers.
Speaker Change: up 12.2% year over year. Of this figure, 27,133 are IT professionals. Our utilization rate is currently 79.5%, 20 basis points up quarter over quarter.
Speaker Change: Our global <unk> got network continues to expand Gus keeps working for some of the most beloved brands and getting rewarded their campaign handshake Hunt for Mercado Libre in Brazil received a Grand Prix at Cannes In June.
Speaker Change: As we look forward, our hiring is set to increase to meet our expanding demand.
Speaker Change: Our attrition level over the last 12 months is currently at 8.6%. This is down from 11.6% in Q2 2023.
Speaker Change: This campaign, where contextual black Friday discounts popped up on television screens every time, a handshake, which also happens to be Mercado Libre is logo was shown is another great example of how technology and creativity are revolutionizing advertising and creating new effective revenue driving opportunities.
Speaker Change: Finally, our Be Kind initiative continues to develop and impact our communities.
Speaker Change: As Globent has learned from our work fusing sustainability with our business, we developed GreenIT to guide sustainable software development.
Speaker Change: We crafted a training for Sustainable Design Essentials, which aims to equip our stakeholder ecosystem with the knowledge and skills necessary to create sustainable designs that minimize environmental impact and optimize energy efficiency.
Speaker Change: Got one a total of 21 Cannes Lions confirming another great year for the agency. We are excited to augment the work for global Guts array of clients, which include Coca Cola, Google Stella Artois, Microbe Ultra Tim Hortons, FIFA, La Liga and Martel among many others.
Speaker Change: We have partnered with Udemy, one of the world's largest online learning platforms, to also offer this training to a global audience for free.
Speaker Change: From two decades and investing at the forefront of technology trends, we are determined to make our mark now that our investments in areas from enterprise to sustainability and AI are coming to fruition.
Speaker Change: In July, our corporate investment fund, Globant Ventures, invested seed capital in Asteroid Technologies, a company dedicated to improving the quality of life for people with various disabilities.
Speaker Change: I leave you all with Patricia Pommies, our COO. Thank you.
Speaker Change: Hello, everyone happy to be back.
Speaker Change: Through Áblalo, their inclusive technological platform, Asteroid Technologies facilitates communication for over 400,000 people with speech disabilities worldwide.
Patricia Pommies: Let's start with our clients.
Patricia Pommies: We currently have 19 clients, bringing in more than $20 million of annual revenue and 329 that provide more than $1 million of annual revenue $16, 3% more than one year ago.
Speaker Change: With this investment, we aim to bring these accessibility solutions closer to our clients so that they can provide a more inclusive service to their consumers.
Speaker Change: Our largest client the Walt Disney Company grew 11, 1% year over year and 3% quarter over quarter.
Speaker Change: Thank you for being with us again. With that, I will hand it over to Juan to share our financials. Thank you, Pato. We are very proud of our results today. First, our second quarter results are aligned with the guidance, showing strong growth and profitability.
Among our 20 biggest accounts the average duration of our client relationships is over 10 years.
Speaker Change: This is testament to <unk> focus on developing true thought partnership with our clients executed through the quality of our delivery.
Juan: Second, we see positive trends in the business. Pipeline and bookings have been solid in the first half, while Gen-AI related projects are tractioning strongly, providing optimism about future demand opportunities.
Speaker Change: As of Q2, 2024, we see better traction and growth in every region compared to the same quarter in 2023.
Speaker Change: Our best performing region this quarter with Europe, growing 44, 7% year over year as we announced in our last earnings call. In May here, we were able to land the largest deal in our company's history made possible by our scale and growth of our delivery network in the region.
Speaker Change: Third, we are maintaining a strong outlook for the year, and we are raising our adjusted margin and EPS guide. Let me provide more color.
Speaker Change: Second quarter results were strong across the board. Our Q2 revenues reached $587.5 million, up 18.1% year-over-year, in line with our guidance.
Speaker Change: Our new market region grew by 25, 1% year over year.
Speaker Change: Excluding the negative impact of foreign exchange.
Speaker Change: Latin America 23, 2% year over year, and North America grew by nine 7% year over year in.
Speaker Change: Growth stood at 18.8% year-over-year. We saw a 10% year-on-year revenue growth in organic constant currency terms in Q2. Also, from a quarter-on-quarter growth perspective, the company posted accelerating trends from both a geographic and vertical split.
Speaker Change: In addition, global global revenue stream is the most diverse it has ever been.
Speaker Change: North America now makes up 56, 3% of our revenue followed by Latin America at 23% Europe at 16, 9% and the Middle East and APAC at three 8%.
Speaker Change: Our pipeline remains at record highs, and booking trends reinforce our outlook for the year.
Speaker Change: Bookings in the first half are up 17% compared to the second half of 2023. We closed Q2 with an adjusted gross profit margin of 38.1% and an adjusted operating margin of 15.1%, both of them up 10 basis points quarter over quarter.
Speaker Change: Of the eight industry verticals, we provide services for seven are up on a year over year basis and for experiencing double digit growth.
Speaker Change: Year to date, all verticals have shown positive growth.
Speaker Change: This quarter, our fastest growing vertical was travel and hospitality up 58, 9% year over year.
Speaker Change: This reflects our ability to maintain high profitability levels despite the current context and currency fluctuations.
Speaker Change: Consumer retail and manufacturing grew 38, 7% year over year.
Speaker Change: Our effective tax rate stood at 20.2% for the quarter, resulting in an adjusted net income of $66.9 million, with an 11.4% adjusted net profit margin.
Speaker Change: Media and entertainment is up 20% year over year.
Speaker Change: This is on the back of a very strong performance with our top client Disney along with our expansion and momentum in sports with work with delivering in the middle East.
Speaker Change: Adjusted diluted EPS was $1.51, up 11% year over year.
Speaker Change: The banks financial services and insurance vertical showed a 11, 6% increase in revenues compared to the same period last year as of Q2, our total head count is 29112, Globus up 12, 2% year over year.
Speaker Change: Our balance sheet remains strong, ending the quarter with $180.4 million in cash and short-term investments, or $54.8 million in net cash.
Speaker Change: With $125 million drawn from our $725 million revolving credit facility, we have ample funding for our growth initiatives.
Speaker Change: This figure 27133, our I T professionals, our utilization rate is currently 79.5% 20 basis points up quarter over quarter.
Speaker Change: Also, as usual, given the seasonality of our business, we expect to generate a substantial amount of free cash flow in the second half of 2024.
Speaker Change: As we look forward our hiring is set to increase to meet our expanding demand.
Speaker Change: Looking ahead, for the remainder of 2024, we are reiterating our guide on a constant currency basis and raising our margin and EPS outlook.
Speaker Change: Our attrition level over the last 12 months is currently at eight 6%. This is down from 11, 6% in Q2 2023.
Speaker Change: In organic constant currency terms, we continue to expect approximately 10.1% year-on-year growth for 2024.
Speaker Change: Finally, our be kind initiative continues to develop and impact our communities as.
Speaker Change: Global has learned from our work fusing sustainability with our business, we developed Green I T to guide sustainable software development.
Speaker Change: Recent FX trends, especially in LATAM, imply a slight incremental FX headwind on our top line. However, we will be able to capture some of this cost benefit over the following quarters.
Speaker Change: We crafted a training for sustainable design essentials, which aims to equip our stakeholder ecosystem with the knowledge and skills necessary to create sustainable designs that minimize environmental impact and optimize energy efficiency.
Speaker Change: We project Q3 2024 revenues of $611 million to $617 million, with adjusted operating margins between 15% and 16%.
Speaker Change: We have partnered with you to me one of the world's largest online learning platforms to also offer this training to a global audience for free.
Speaker Change: IFRS effective income tax rate is expected to be in the 22 to 24 percent range. Adjusted EPS for the third quarter is now expected to be in the range of $1.60 to $1.64.
Speaker Change: In July our corporate investment fund global ventures invested seed capital an asteroid technologies, a company dedicated to improving the quality of life for people with various disabilities through.
Speaker Change: assuming 44.4 million average diluted shares.
Speaker Change: For the full year, our revenue guidance is $2,407,000,000 to $2,421,000,000, unchanged at the midpoint when adjusting for foreign exchange fluctuations.
Speaker Change: Although they are inclusive technological platform asteroid technologies facilitates communication for over 400000 people with speech disabilities worldwide.
Speaker Change: We are forecasting 70 basis points of FX headwind in our full year guidance. We anticipate adjusted operating margins in the range of 15 to 15.5%.
Speaker Change: With this investment we aim to bring these accessibility solutions closer to our clients. So that they can provide a more inclusive service to their consumers.
Speaker Change: You for being with US again with that I will hand, it over to Juan to share our financials. Thank you part of we are very proud of our results today.
Speaker Change: 2024 IFRS effective income tax rate is expected to be in the 22 to 24 percent range.
Speaker Change: Finally, our adjusted EPS is expected to be between $6.30 to $6.50, assuming 44.3 million average diluted shares outstanding for the year, improving relative to our previous guide.
Speaker Change: First our second quarter results are aligned with the guidance showing strong growth and profitability.
Juan: Second we see positive trends in the business.
Speaker Change: <unk> and bookings have been solid in the first half while Jen AI related projects, our traction in strongly providing optimism about future demand opportunities third we are maintaining a strong outlook for the year and we are raising our adjusted margin and EPS guidance, Let me provide more color second quarter results were.
Speaker Change: In summary, we remain encouraged for the business with solid bookings, a strong pipeline, progress in AI adoption, and an improving margin outlook while reiterating resilient top-line growth.
Speaker Change: Thank you for your continued support. We look forward to updating you on our progress throughout the year.
Speaker Change: Strong across the board, our Q2 revenues reached $587 $5 million up 18, 1% year over year in line with our guidance, excluding the negative impact of foreign exchange growth stood at 18, 8% year over year, we saw a 10% year on year revenue growth inorganic cons.
Speaker Change: Thank you Juan, and hi everyone, it's good to see you.
Speaker Change: So as we go through the question and answer section of this call, I will first announce your name. At this point, please unmute your line and ask your question, and then please mute your line after your question is done. And also, we kindly ask you to limit yourself to one question, please.
Speaker Change: <unk> currency terms in Q2 also from a quarter on quarter growth perspective, the company posted accelerating trends from both a geographic and vertical split.
Speaker Change: With that in mind, we'll take the first question from today from the line of Tien-Hsing Huang from J.P. Morgan. Tien-Hsing, please go ahead.
Speaker Change: Our pipeline remains at record highs and booking trends reinforce our outlook for the year booking.
Speaker Change: Bookings in the first half are up 17% compared to the second half of 2023, we closed Q2 with an adjusted gross profit margin of 38, 1% and an adjusted operating margin of 15, 1% both of them up 10 basis points quarter over quarter. This reflects our ability to maintain high profitability.
Tien-Hsing Huang: Thanks Arturo, thank you so much.
Tien-Hsing Huang: I'll start on the outlook just with the reiteration of the constant currency guide, put the raise in the margin, just wanted to check the confidence level. Now that we're through the first half, I know the bookings have
Tien-Hsing Huang: are explaining or informing some of the revenue outlook. But how has that changed versus 90 days ago? Can you also rehash?
Speaker Change: <unk> levels, despite the current context and currency fluctuations our effective tax rate stood at 22% for the quarter, resulting in an adjusted net income of $66 $9 million with an 11, 4% adjusted net profit margin.
Speaker Change: was driving up the marches as well. Thank you.
Speaker Change: Thank you for the question. So as you said, you know, we are reiterating our cost of currency growth for the year at 15.9%. In dollar terms, it's going to be 15.2%.
Speaker Change: Adjusted diluted EPS was $1 51 up 11% year over year.
Speaker Change: Our balance sheet remains strong ending the quarter with $184 million in cash and short term investments or $54 8 million in net cash with $125 million drawn from our $725 million revolving credit facility, we have ample funding for our growth initiatives.
Speaker Change: The reason for that was the depreciation in Colombia and Mexico primarily and a little bit in Brazil as well.
Speaker Change: In terms of, I mean, at the same time that this has impacted.
Speaker Change: our revenue guidance from last quarter. It has also benefited us.
Speaker Change: from the cost side, so on the margins.
Speaker Change: Also as usual given the seasonality of our business, we expect to generate a substantial amount of free cash flow in the second half of 2024 looking ahead for the remainder of 2024, we are reiterating our guide on a constant currency basis, and raising our margin and EPS outlook.
Speaker Change: So, basically...
Speaker Change: Part of the increase.
Speaker Change: that we are seeing in our operating margin and our gross margin as well for the second half of the year comes from FECS.
Speaker Change: It also comes...
Speaker Change: from a slightly better than expected revenue per head, which has grown quite nicely this quarter. But the backside of this is on the revenue front, as we said, we have to increase 40 bps the impact of effects for the year.
Speaker Change: Organic constant currency terms, we continue to expect approximately 10, 1% year on year growth for 2024, recent FX trends, especially in Latam imply a slight incremental FX headwind on our top line.
Speaker Change: Yeah, and regarding pipeline, it remains quite strong and bookings too, so we are in good confidence of the guidance that we provided teaching.
Speaker Change: However, we will be able to capture some of this cost benefit over the following quarters.
Speaker Change: We project Q3, 2024 revenues of 611 million to $617 million with adjusted operating margins between 15 and 16%.
Speaker Change: Our effective income tax rate is expected to be in the 22% to 24% range adjusted EPS for the third quarter is now expected to be in the range of $1 60 to.
Speaker Change: Thank you, Tintin. The next question comes from the line of Jim Schneider from Goldman Sachs. Jim, please go ahead. Your line is open.
Jim Schneider: Good evening. Thanks for taking my question. I was wondering if you can maybe expand, Martin, on your comments about Gen-AI projects among corporates.
Speaker Change: The $1.64.
Speaker Change: You mean, $44 4 million average diluted shares.
Jim Schneider: I'm taking longer to scale into large scale beyond proof of concept. Is that more a function of
Speaker Change: For the full year, our revenue guidance is $2.407 billion to $2.421 billion unchanged at the midpoint when adjusting for foreign exchange fluctuations.
Speaker Change: the lack of clarity about how to scale or maybe the lack of data stack comparability or other issues.
Speaker Change: We are forecasting 70 basis points of FX headwind in our full year guidance, we anticipate adjusted operating margins in the range of 15 to 15, 5%.
Speaker Change: In terms of things that need to be resolved on the back end before bigger transformations can be undertaken, can you maybe talk about any of the larger projects you've seen in generative AI and to what extent, how many of those are there and what is magnitude in terms of scale revenue? Thank you.
Speaker Change: 2024, I FRS effective income tax rate is expected to be in the 22% to 24% range.
Speaker Change: Finally, our adjusted EPS is expected to be between $6 and 30.
Speaker Change: Jim, thank you so much for the question. I will answer the first part and then I will let it to Diego to answer. We have seen a pretty good growth in terms of our AI related projects.
Speaker Change: To $6 50.
Speaker Change: Assuming $44 3 million average diluted shares outstanding for the year, improving relative to our previous guide in.
Speaker Change: In summary, we remain encouraged for the business with solid bookings are strong pipeline progress in AI adoption, and an improving margin outlook, while reiterating resilient topline growth.
Speaker Change: As I mentioned, like a 130% growth approximately year over year.
Diego Tartara: The thing about the projects, and many of them are still on, on their, you know, they're, they're still analyzing them, are still trying to kind of generate the lab around AI.
Speaker Change: Thank you for your continued support we look forward to updating you on our progress throughout the year.
Speaker Change: [music].
Diego Tartara: to understand use cases and many of the companies and many of our customers are still in that stage.
Speaker Change: Yeah.
Speaker Change: Thank you, Bob and hi, everyone.
Diego Tartara: The thing is, when you are implementing an AI project for a demo, it really looks great. I mean, for demo on social media, it really looks great and it's very easy.
Speaker Change: So as we go through the question and answer session of this call I will first announce your name at this point. Please limit your line and ask your question and then please mute your line up to your question is done and also we kindly ask you to limit yourself to one question. Please.
Diego Tartara: Now, when you want to take it to enterprise class, as I mentioned, it's disappointingly much more complex.
Speaker Change: With that in mind, we will take the first question from today from the line of <unk> <unk> from JP Morgan and simply.
Speaker Change: And that requires, as you mentioned, data projects on the back. It requires a lot of supervision and after training because of models.
Speaker Change: Yeah. Thanks, So sundar. Thank you so much just maybe on the.
Speaker Change: I'll start on the outlook just with the reiteration of the constant currency guide, but the raise in the margin just wanted to check the confidence level now that we're through the first half another bookings as our.
Speaker Change: tends to be hackable, tends to be a lot of, you know, a lot of the answers that the models give can be very misleading if they are not well curated. So those processes are long by definition, so
Speaker Change: Explaining are informing some of the revenue outlook.
Speaker Change: How has that changed versus our versus 90 days ago can you just also rehash.
Speaker Change: We need to remember when the first...
Speaker Change: What's driving up the marches as well thank you.
Speaker Change: The first app store from Apple, born in 2005, and then only in 2000.
Speaker Change: Sure sure Yeah. Thank you. Thank you. Thank you for the question.
Speaker Change: He said you know we are reiterating our constant currency growth for the year.
Speaker Change: and 9 or 10, the big, you know,
At 15, 9% note, our terms with vendors and 15, 2% and 52%.
Speaker Change: digital transformation projects started to happen. That was very long compared to what I think is gonna be this time. But remember this new technology has only a year and a half in the state that you are.
Speaker Change: The reason for that was the depreciation in Colombia, and Mexico, primarily and a little bit in Brazil as well.
Speaker Change: In terms of I mean at the same time that this has impacted our.
Speaker Change: seeing it right now. So I believe the steel...
Speaker Change: Our revenue guidance from last quarter.
Speaker Change: Also benefited us.
Speaker Change: time for corporations to understand the use cases. Of course, we are helping them in many of the in many of the situations and of course we are starting to see some of them
Speaker Change: From the cost side, so on the margins. So basically part of the increase that we are seeing in our operating margin on our gross margin as well for the second half of the year comes from FX. It also comes from slightly better than expected revenue per head has grown.
Speaker Change: starting to ramp up plans.
Speaker Change: for doing much longer term investments on that. But I don't think it will be an easy process. And I think it will take a lot of
Speaker Change: Nicely this quarter, but the oxides.
Speaker Change: time and understanding on where to apply it before they go full into the investment. But Diego, do you want to complement on that?
Speaker Change: This is on the revenue front US who said we are we hope to increase 40 bps the impact of FX for the year.
Speaker Change: Yeah and regarding pipeline.
Diego Tartara: Yes, sure.
Speaker Change: It remains quite strong and bookings too so.
Diego Tartara: So, one of the things we've been seeing is, I want to separate things between Gen-AI, which is the new Kingdom on the Block, and traditional AI or machine learning. We've seen an increase on the projects, of course, on both sides.
Speaker Change: We are and <unk> got good confidence of the guidance that we provided.
Diego Tartara: There's a positive trend in terms of how we are being approached from our clients. We're now implementing on both sides, of course.
Speaker Change: Thank you Tien Tsin. The next question comes from the line of Jim Schneider from Goldman Sachs. Tim. Please go ahead. Your line is open.
Diego Tartara: Projects that are meant to be you know live and productive. This is not an approach I want to experiment with this and we've done a ton of things from dealing with data for
Jim Schneider: Good evening and thanks for taking my question I was wondering if you can maybe expand on your comments about Jenny I projects about among corporates are taking longer to scale into large scale beyond proof of concept is that more a function of the lack of clarity about how to scale.
Diego Tartara: example, pharmaceutical companies to curate and label that data with AI, and especially with Gen AI. This is actually proactive. A lot of studies are being conducted on top of that.
Jim Schneider: Or maybe the lack of data.
Jim Schneider: Data stack comparability or other issues.
Diego Tartara: to streamline operations on copper and gold mining.
Jim Schneider: In terms of things that need to be resolved on the backend before bigger transformations can be undertaken in can you maybe talk about any of the larger projects you've seen in general is AI and to what extent are you know how many of those are there and what is the magnitude in terms of skilled revenue. Thank you.
Diego Tartara: and now we're doing a 360 sustainability calculator and optimizer with AI models for it. So we're doing a ton of things that are actually productive. I would like to see a lot more. In fact, I didn't mention this, which I think it's great.
Jim Schneider: Jim. Thank you so much for the question.
I will answer the first part and then I will let it to be able to answer.
Diego Tartara: We mentioned that we're working with Asians for software development. We have also implemented Asians for to make sure real estate companies to streamline all their operations. So this is this is not POC. This is actually live, so
Jim Schneider: We have a we have seen a pretty good growth in terms of our AI related projects.
Jim Schneider: As I mentioned.
Speaker Change: Like a 130% growth approximately.
Diego Tartara: Again, maybe in terms of the sheer volume of this, I would like to see much more, but the trend in terms of what we are doing and how we are approached by our clients, I see a super positive scenario.
Speaker Change: Year over year and.
Speaker Change: The thing about the projects many of them are still on there.
There are still analyzing them are still trying to kind of generate the lab around AI.
Speaker Change: Also, I think that you mentioned something about the talent, and I want to, I mean, do you remember that in the last Turing Call, we also...
To understand use cases, and many of the companies in many of our customers are still in that stage.
Speaker Change: The thing is when you are implementing an AI project.
Speaker Change: explained is that we have been upskilling and reskilling most of the globbers and in 2023 we certify all the globbers in the AI.
Speaker Change: The demo it really looks great I mean for demo and social media, it really looks great and it's very easy.
Speaker Change: So I think that it's really important. We are more than prepared for what is coming in terms of the talent and in terms of the recruiting and where we're looking that talent. So I think this is really important for us is that all the companies having this AI mindset and we are following what the clients are needing.
Speaker Change: Now when you want to take it to enterprise class as I mentioned is disappointingly much more complex and that requires a few mention data projects on the back of it requires a lot of supervision and after training because that model tends to be hot Cabo tends to be a lot of it.
Speaker Change: Thank you.
Speaker Change: And all of the answers that the model's Gabe can.
Speaker Change: [inaudible]
Speaker Change: Be very misleading if theyre not well curated so those processes those processes are long by by definition. So.
Speaker Change: Thank you Jim and thank you Bato. The next question comes from the line of Maggie Nolan from William Blair. Maggie, please go ahead.
Speaker Change: We need to remember when when the first.
Speaker Change: The apples the first app store for from Apple.
Speaker Change: Born in 2005, and then only in 2009 or 10, the Big you know.
Speaker Change: Digital transformation projects started to happen.
Speaker Change: Subs by www.zeoranger.co.uk
Speaker Change: but we were able to achieve some low single digit pricing growth.
Speaker Change: Very long compared to what I think is going to be this time, but remember this new technology has only a year and a half in the in the in the state that you are seeing it right now.
Speaker Change: and we combined that.
Speaker Change: with, you know, a different mix in terms of services. We've been growing nicely our GATT creative network.
Speaker Change: So I believe there's still time for corporations to understand the use cases of course, we are helping them in many of the in many of the situations and of course, we're starting to see some of them starting to ramp up plans for doing a much longer term investments on that.
Speaker Change: which has a higher revenue per head as well. And also, you know, with some of the deals that we are delivering in Europe, we were able to also increase our onsite presence.
Speaker Change: So, the combination of those factors is giving you almost 9% year-over-year revenue per head growth.
Speaker Change: It's a tough market, but we're still being able to get some positive pricing in some of our customers and relationships.
Speaker Change: But I don't think it would be an easy process and I think it will take a lot of time understanding on where to apply it before they go. They go you know full into the into the investment, but Diego do you want to complement on that.
Speaker Change: Thank you, Maggie. The next question comes in the line of Brian Bergen from TD Cohen. Brian, please go ahead.
Speaker Change: So one of the things we've been seeing is I want a separate things between Jennie O here, which is the new kid on the block and traditionally I or machine learning.
Speaker Change: The Fiction.
Brian Bergen: Hey guys, thanks. Hope you could hear me. I want to ask about Gen AI and delivery. Can you comment on the latest impacts you're seeing on engineering productivity and really how client discussions are evolving and the appetite around that, particularly if you could include how AI agents and the contracting dynamics around those work?
Speaker Change: We've seen an increase on the prospects of course from both sides. There theres a positive trend in terms of how we're being approach from our clients. We are now implementing on both sides of course are projects that are meant to be you know leave them productive, they're just not unapproachable I want to experiment with this and we've done a.
Juan Urthiague: Juan Urthiague.
Speaker Change: Again, I want to separate things. On the co-pilot side of things, I think there's a ton of public information about that. The actual result, what you see on the field, in productive teams, large teams with large code base,
Ton of things from.
Speaker Change: Dealing with data for example, pharmaceutical companies.
Speaker Change: To curate and label that data with AI, and especially with Jennie O. This is actually proactive a lot of studies are being conducted on top of that to streamline our operations on a copper.
Speaker Change: It's actually the impact is a lot less than what it's being communicated at the very beginning, like 50% of the code is being generated by AI, but the impact definitely is there.
Speaker Change: Copper and gold mining company.
Speaker Change: Company and know we're doing a 360 sustainability calculator and optimizer with AI models for it. So we're doing a ton of things that are actually productive I would like to see a lot more and in fact I didn't mention this which I think it's great.
Speaker Change: The second aspect, which is Asians, this is actually super new and it has different type of impacts depending on the task
Speaker Change: you're wanting to automate. Remember that agents fully automate flows, so it's not about helping one individual and making that individual more efficient.
Speaker Change: We mentioned that we were working with patients for a software development. We have also implemented <unk> for it to make sure real estate companies to streamline all their operations. So this is this is not a POC is actually life. So again.
Speaker Change: On the ancient side of things, we're seeing with...
Speaker Change: super early tests that we've been conducting.
Speaker Change: Pretty amazing results like what we've been developing. We're seeing results that are above the benchmarks. We are seeing in the market
Maybe in terms of the sheer volume of this Ah I would like to see much more but the trend in terms of what we are doing and how we our approach for clients are you see a super positive.
Speaker Change: So we are
Speaker Change: Super, super confident that this will bring very nice results for teams, especially for some type of tasks, like bug fixing, as an example. Too early to commit to a number, but so far it looks very promising.
Speaker Change: Scenario.
Speaker Change: Also do you think that the most.
Speaker Change: Something about its islands and I went to I mean.
Do you remember that in the last earnings call. We also explained is that we haven't been upskilling and Reskilling most of the clubs and intend to 'twenty three we certify all the clubs in the AI. So at the end that is really important we are more than prepared for what is coming in terms of the talent and in terms of their recruiting and then when.
Speaker Change: Thank you, Brian, for the question. The next question comes from the lines of Jason Kupferberg from Bank of America. Jason, please go ahead.
Jason Kupferberg: Thanks guys. I just had a two part question on headcount. The first part is, do you expect positive growth in billable heads in the second half of the year? I think first half was kind of flattish.
Speaker Change: Well, we're looking at talent, so I think.
Speaker Change: That is really important for us is that all the companies having this a a mindset and we're following what the clients are needing.
Jason Kupferberg: And then the second part is just on the second quarter headcount numbers, just looking quarter over quarter. I think India was up quite a bit, high single digits. U.S. was actually down about 10%, so I was just curious if there were any call-outs for those regions.
Speaker Change: Thank you Jim and thank you. The next question comes from the line of Maggie Nolan from William Blair. Maggie. Please go ahead.
Speaker Change: Hi, how are you.
Maggie Nolan: Thank you for taking my question. So you mentioned that revenue per head is improving our head ground maybe year over year its pricing power strong right now are you experiencing any competitive dynamics.
Speaker Change: There's a...
Speaker Change: Yes.
Speaker Change: We are expecting to continue with sequential growth in terms of headcount, you know, in second quarter IT professionals grew by about 200, you know, net additions
Speaker Change: The pricing environment, maybe just overall, how would you characterize the environment compared to historical.
Speaker Change: and we expect, you know, to continue having positive net additions for the rest of the year.
Speaker Change: In terms of regions, we have seen, we are seeing Argentina, Colombia.
Speaker Change: Oh.
Speaker Change: But we weren't able to achieve.
Speaker Change: Some low single digit pricing growth.
Speaker Change: and India as well, showing good growth.
Speaker Change: We combine that with you know.
Speaker Change: A different mix in terms of services, we've been growing nicely and where it got created network.
Speaker Change: And it's a reflection, you know, of our position in those markets and, you know, us being the, you know, the most relevant player in Latin America. And with all the geopolitical noise that is happening around the world, Latin America continues to be.
Speaker Change: Which has a higher revenue per head as well and also.
Speaker Change: With some of the deals that we are delivering in Europe, we weren't able to also increase our onsite presence. So the combination of those factors is giving you almost 9%.
Speaker Change: a great place to be and, you know, we are, you know, the company that somehow leads in that market.
Speaker Change: Year over year revenue growth.
Speaker Change: The case of the U.S., you know, it's out of a small base, and it varies, you know, by quarter, but there's nothing really to call out.
Speaker Change: It's a tough market, but we're still so being able to get some positive pricing in some of our customers and relationships.
Speaker Change: Thank you.
Speaker Change: Thank you, Jason. The next question comes from the line of Jonathan Lee from Guggenheim. Jonathan, please go ahead. Your line is open.
Speaker Change: Thank you Maggie and the next question comes from the line of Bryan Bergin from TD Cohen, Brian. Please go ahead.
Jonathan Lee: Great. Thanks for taking my question. Can you help unpack what you're seeing in the top five customer cohort given some of the sequential softness in the quarter, and how are you thinking about the trajectory of that customer base for the remainder of the year and perhaps into 25?
Speaker Change: Yes.
Speaker Change: Hey, guys. Thanks, I'll break it here I'm, a I wanted to ask about your NII and delivery can you comment on the latest impacts you're seeing on engineering productivity and really our client discussions are evolving and the appetite around that particularly if you could include how AI agents and the contracting dynamics around those work.
Speaker Change: which was the cohort, Jonathan, that you were talking about? The top five. Okay, so when you look at the top one, which is Disney, it showed really good numbers. I mean, sequential growth.
Speaker Change: Sure.
Speaker Change: also like 11% year-over-year growth.
Speaker Change: So.
Speaker Change: And actually, we're expecting a strong second half of the year. So on the top one, definitely, you know, good news.
Speaker Change: Again, I want to separate if things are on the pilot side of things I think there's still a ton of public information about that the results. The actual results what you see them on the field in productive teams large teams with large codebase is actually the impact is a lot less than what is being communicated.
Speaker Change: When you look at 2 to 5, there is actually one customer in the professional services sector that, you know, as we spoke several times over the last few quarters, professional services sector.
Speaker Change: was one of the laggards among the different industries that we have.
Speaker Change: A very beginning like 50% of the coldest being generated.
Speaker Change: And what you see in that...
Speaker Change: But the impact definitely used there.
Speaker Change: cohort of 225.
Speaker Change: It's actually explained by that. But then if you look at six to 10, if you look at 11 to the end, you're also going to see, you know, a better, better numbers over there. So nothing in particular to be really concerned. It's just one customer within.
Speaker Change: The second aspect, which is Asia, it's actually a super new and.
Speaker Change: And it has different type of impacts depending on the task you were wanting to ultimatum remember that Asians are fully ultimate flows. So it's not about are helping one individual in making that individual are more efficient.
Speaker Change: One industry that we have been saying for quite a while that still not recovering as we would like
Speaker Change: Thank you, Jonathan. The next question comes from Divya Goyal from Scotiabank. Divya, please go ahead. Your line is open.
Speaker Change: On the agency those are things, we're seeing with Super early tests that we've been conducting.
Speaker Change: Amazing results like what we've been developing we are seeing a result of that.
Divya Goyal: Good evening, everyone. Patricia, you provided some color on different verticals and the growth across different regions. Could you provide a little bit more color as to how do you see the travel and hospitality segment broadly transitioning and which are some of the verticals where you anticipate growth in a go-forward basis? Thank you.
Above the benchmarks, we are seeing in the market. So we are.
Speaker Change: Super Super confident that this will this will bring our.
Speaker Change: A very very nice results for team, especially for sometimes a type of task like a bug fixing as an example.
Speaker Change: Too early to commit to a number but so far it looks a.
Divya Goyal: Hi.
Patricia Pomies: Thank you for your question. Yes, we are seeing, I mean, many of the verticals that we have in Globe and are growing really fast. And of course, hospitality and travel has been one of the of the biggest ones that is growing. Also, we are seeing in media and entertainment growth there also and many others. But the most interesting thing is that
Speaker Change: Very promising.
Speaker Change: Yeah.
Speaker Change: Thank you Brian for the question.
Speaker Change: The next question comes from the lines of Jason Kupferberg.
Jason Kupferberg: From Bank of America, Jason. Please go ahead.
Jason Kupferberg: Thanks, guys.
Patricia Pomies: We are having, it's cutting off, can you hear me okay?
Jason Kupferberg: Two part question on head Count. The first part is do you expect positive growth in billable heads in the second half of the year I think first half was kind of flattish and then the second part is just on the second quarter head count numbers, just looking quarter over quarter, I think India was up quite a bit high single digits U S was actually down.
Speaker Change: sorry oh okay, sorry
Speaker Change: What we are seeing probably, is that in many of the industry, the clients that we have there, we have been a relationship with them, with the main top customers, for more than 10 years in many of the industries. So what we are dealing with there is a,
Jason Kupferberg: About 10%. So I was just curious if there were any call outs.
Speaker Change: is an experience together on how they want to change.
Jason Kupferberg: For those regions.
Speaker Change: the contact with their customers and experience. So we are getting very deep in that expertise and with the studios that we have, the re-invention and the AI studios, we have been working very closely with the clients in terms of identifying what are their needs and how we can help them. So as we were mentioning before, I mean, the seven industries where we are, we are seeing many change going on and growing and we continue to go in most of the industries of where we are.
Speaker Change: So yes, we are expecting to continue with sequential growth in terms of head count you don't.
Jason Kupferberg: In the second quarter.
Speaker Change: Professional grew by about 200.
Speaker Change: Net additions.
Speaker Change: We expect to continue having positive net additions for the rest of the year in terms of regions we have seen.
Speaker Change: We are seen Argentina, Colombia.
Speaker Change: And.
Speaker Change: Filmed.
Speaker Change: India as well showing good growth and it's a reflection.
Speaker Change: Let me add a couple of comments. We are growing strongly on the, specifically on the trial and hospitality vertical that you mentioned.
Speaker Change: Of our position in those markets.
Speaker Change: You know us being the most relevant player in Latin America, and we owned the geopolitical noise that is happening around the World Latin America continues to be.
Speaker Change: because of mainly two things, one is you know we close and we've been mentioning this big transformation and deal for a large airline in Europe.
Speaker Change: A great place to be and you know we are.
Speaker Change: That's one of the key drivers. Our airline studio is actually super, super solid in the segment. And the second one has to do with connected experiences. That's the latest AI re-invention studio that we launched.
Speaker Change: The company that somehow lead in that market.
Speaker Change: The case of the U S.
Speaker Change: <unk>.
Speaker Change: It's out of a small base.
It varies by quarter, but there's nothing really to call out.
Speaker Change: Thank you.
Speaker Change: And a lot of the business we have in MENA is actually from the hospitality vertical. So that explains the growth, but it's super tied to how solid Globan is in those specific verticals.
Speaker Change: Thank you Jason next question comes from the line of Jonathan <unk> from Guggenheim. Jonathan. Please go ahead. Your line is open.
Jonathan: Great. Thanks for taking my question can you help unpack, what you're seeing in the top five customer cohort given some of the sequential softness in the quarter and how are you thinking about the trajectory of that customer base for the remainder of the year and perhaps into 'twenty five.
Speaker Change: media entertainment, you're also going to see, you know, further growth as Disney continues to perform, as well as our, you know, business within sports.
Jonathan: Which ones are the cohorts, Jonathan you were talking about a five.
Jonathan: Okay. So when you look at the top one which is this mean it showed really good numbers I mean sequential growth.
Speaker Change: We are also seeing good momentum in consumer and retail, that has been also delivering good growth.
Speaker Change: Also like 11% year over year growth.
Speaker Change: We are expecting a strong second half of the year. So on the top one definitely you know good news.
Speaker Change: And on the BFSI, you're also going to see some growth. The two only industries that, I mean, professional services, as we said before, that's not showing growth.
Speaker Change: When you look at 225, there's actually one customer and the professional services sector that.
Divya Goyal: and technology and telecommunications has actually stabilized. I mean, we did show some growth in Q2, but basically coming out of several quarters of underperformance. We can say, you know, this is the second quarter that we see some positive news there. So technology and telecommunications have stabilized, Divya.
Speaker Change: Who spoke several times over the last few quarters professional sectors.
Professional services sector was one of the laggards among the different industries that we have and what you see in that cohort of 2% to five sexual explained by that and then if you look at six to 10, if you look at dealer into the and you're also going to see you know.
Speaker Change: Thank you Divya. The next question comes from the line of Arvind Ramani from Piper Sander. Arvind, please go ahead.
Speaker Change: Better better numbers over there so nothing in particular to be.
Speaker Change: Really concern it is one customer within one industry that we have been saying for quite a while.
Arvind Ramani: Thanks for taking my question. You know, just one quick, discrete question I wanted to ask was,
Speaker Change: Still not recovering as we would like.
Speaker Change: Organic constant currency.
Arvind Ramani: target for the year that you have now versus organic constant currency you had three months back but just just a discrete question but the bigger question I have is also on the you know overall market right like I mean now it's been you know two or three years now where
Speaker Change: Thank you Jonathan the next question.
David <unk>: The line of David <unk> from Scotiabank.
Speaker Change: Please go ahead your line is open.
David <unk>: Good evening everyone.
David <unk>: It's Michelle you provided some color on different verticals and the growth across different regions could you provide a little bit more color as to how do you see the travel and hospitality segment broadly transitioning and which are some of the verticals, where you anticipate growth in a go forward basis.
Arvind Ramani: You know being able to grow in idiosyncratic way right like in the rest of the industry is kind of languished Vibrating at like plus three four percent minus three four percent, but you know global
Arvind Ramani: It's been like three years now where you've been able to art.
Speaker Change: really outpaced that that growth and while I'm not looking for any kind of guidance in 2025, you know, what is the view of the industry growth rates starting to improve, right, or are we going to be in this permanent sort of zero to five for the broader industry?
Speaker Change: Hi, Thank you for your question, Yes, we are seeing I mean, many of the verticals that we have in global and they're growing really fast and of course after dial it in and travel has been one of the of the data is one that is growing although we have seen in media and entertainment.
Speaker Change: So I'll take the first part and then I'll ask Martin to complement, you know. Basically, the number, organic constant, the growth, you know, in terms of organic constant currency growth for that we get.
Speaker Change: Growth there also and many others, but the most interesting thing is that.
Speaker Change: But we are having.
Speaker Change: It's got to know you'll hear me okay.
Speaker Change: Sorry.
Speaker Change: Thank you.
Speaker Change: What we are seeing probably is that in many of the industry. The clients that we have there we had been a relationship with them with the main top class customers for more than 10 years and many of the industry. So what we are dealing with that is that if the travel is then is an experience together on how they want to check.
Speaker Change: Thank you.
Speaker Change: <unk> the contact with their customers and experience. So we are getting very deep in that in that expertise and with the studios that we have the reinvention NDA studios, we have been working very closely with our clients in terms of identifying what are their needs and what how we can help them. So as we were mentioning before.
Speaker Change: Thank you.
Speaker Change: Rachel, Rachel on Thank you. Rachel.
Speaker Change: Okay, we're back. Juan, if you don't mind starting from the beginning, what could I please do for any of you?
Speaker Change: Sure I mean, the seven industries, where we are we have seen many changes going on and growing and we continue to go in and in most of the industry. The way we are.
Juan Urthiague: Yeah, I will, I will start again. So when you look at our constant currency growth for the quarter, sorry, for the year, we we are at 10.1% constant currency growth, organic growth, which is the same number that we provided back in May. When you look at the total, the total growth number, this quarter for the year, we are guiding 15.2%, with 70 basis points of impact back, so 15.9% constant currency growth.
Speaker Change: Let me add a couple of comments, we're growing strongly on the specifically on the travel and hospitality verticals that you mentioned Ah.
Speaker Change: Because of mainly two things one is you know we close in we've been mentioning this a big transformational deal for a large airline in Europe.
Speaker Change: That's a that's one of the key drivers our Airlink studio is is actually Super Super solid in the segment.
Juan Urthiague: Back in May, we guided 15.6 percent.
Speaker Change: The second one has to do with our connected experiences. That's in latest Oh, you already mentioned to you that we launch.
Juan Urthiague: with 30 basis points of impact. So basically the change is 40 basis points of additional effects impact, which is aligned with what is happening in Mexico, Colombia, and a little bit in Brazil.
Speaker Change: In a.
Speaker Change: A lot of the business we have Amanda.
Speaker Change: Actually from a the hospitality vertical so that explains.
Speaker Change: The growth, but it's super tied to how solid global little niche in those specific verticals.
Juan Urthiague: The good part of that impact is that we were able to increase
Juan Urthiague: our operating income guidance for the year. You know, we moved out of 14 and a half
Speaker Change: Media and entertainment you are also going to see.
Speaker Change: Further growth <unk> continues to perform as well as our business.
Juan Urthiague: to 15.5%, we are now at 15 to 15.5%
Juan Urthiague: for the year and also the guidance for the third quarter and basically the same one for the fourth quarter, the implied guidance there.
Business within sports.
Speaker Change: We are also seeing good momentum in consumer and retail.
Speaker Change: That has been also delivering good growth and on the Reefer side Youre also going to see some growth the two only industries that I mean.
Juan Urthiague: is 15 to 16 percent. So that's the overall picture in terms of FX impacts in this quarter. And I don't know, Martin, if you want to talk a little bit. The main reason I think why the industry is, let's say,
Speaker Change: Professional services as we said before that's not showing growth.
Speaker Change: On technology and telecommunications are factually stabilized I mean, we did show some growth in Q2, but basically coming out of several quarters of underperformance.
Martin: plus 2, minus 2, or minus 5.
Martin: and we're still growing, you know, at very healthy rates is that the decisions that we took in the past. I mean, when we say that the vision we have is to try to leverage our relationships and being able to sell every day more things.
Speaker Change: We can say this is the second quarter that we see some positive news there so technology and telecommunications have stabilized.
Speaker Change: Yeah.
Martin: to our beloved customers.
Thank you. The next question comes from the line of Arvin Rahmani from Piper Sandler. Please go ahead.
Martin: This is extremely powerful when you take it in the long run.
Speaker Change: Oh, Hey, Thanks for taking my question just one quick other question I wanted to ask was.
Martin: and we have been executing that in a pretty consistent manner. The second reason is that we have been expanding into markets in which
Speaker Change: Organic constant currency.
Martin: We were not present before, so now we are entering, you know, a big time into the Middle East.
Arvin Rahmani: <unk> target for the year did you have now versus organic constant currency you had three months bank.
Martin: into some other countries in Oceania, in Asia.
Speaker Change: So just three questions.
Speaker Change: But the bigger question I have is also on the.
Speaker Change: Overall market right now it's been two or three years now where no one's.
Martin: And that is providing us like an additional, you know, fuel for growth.
Martin: that we didn't have before.
Speaker Change: Being able to grow an idiosyncratic way right like in the rest of the industry is kind of languished right reading.
Martin: So when you add up those two things, plus the organic growth of our largest customers, which is still very healthy, then you have a performance which is...
Speaker Change: Plus three 4% minus three 4%, but globally, it's been like three years, now where you've been able to fill.
Martin: pretty different from the rest. Another way to understand that could be...
Speaker Change: Clearly outpacing that growth.
Speaker Change: And while I'm not looking for any kind of guidance in 2025, what is your view of the industry growth rates starting to improve right or are we going to be in this permanent.
Martin: to say that Globan is...
Speaker Change: gaining market share.
Speaker Change: Well, the market is not growing and you're still growing, then you're
Speaker Change: winning market share. And this is extremely important for us and also the revenue per head. When you see the revenue per head that Juan explained before, you see it increasing to very good and very healthy levels. That is a testimony of the value that we are delivering to our customers.
Speaker Change: Zero to five but for the broader industry.
Speaker Change: So I'll take the first part and then I'll ask Martin to complement.
Basically the number organic constant growth in terms of organic constant currency growth for.
Juan Urthiague: On top of all that...
Speaker Change: But we can.
Speaker Change: A very strong growth on the AI space that we have been preparing for the last 10 years. So I think that's a good summary of the reasons why Globan is growing.
Speaker Change: fueled by a very powerful culture.
Speaker Change: by a very high ambition of reinvent the way.
Speaker Change: that technology is being created. We invent a way that we connect with our globals, with our customers, with all our stakeholders. So we're extremely happy with the performance and we'll keep on, you know, hopefully driving that kind of performance for next year too.
Speaker Change: Yeah.
Speaker Change: [music], especially what's the signal.
Speaker Change: Thank you. And just one quick one, if I can, is also you had Booking's growth of 17% which is faster than the kind of organic constant currency revenue growth.
Speaker Change: Okay.
Speaker Change: Hum.
One if you don't mind starting from.
Speaker Change #100: Wasn't able to hear you.
Speaker Change #101: Yeah, well I will start again, so when you look at our constant currency growth for the quarter sorry for the year. We were at 10, 1% constant currency growth organic growth, which is the same number that we provided back in may when you look at the total not the total growth number.
Speaker Change: And I know bookings come with various durations, but the faster sort of bookings, does that suggest that next year you should be seeing acceleration in the business on the revenue side?
Speaker Change: I think it's still early, you know, to talk about 2025.
Speaker Change: in detail. I mean, there is a lot of things going on around the world.
Speaker Change #101: This quarter for the year, we are guiding 15, 2% with 70 basis point.
Speaker Change: and a lot of things that we have.
Speaker Change #102: Impact Buck so 15 nine constant currency growth back in May we guided 15, 6% with a 30 basis points of impact. So basically the change is 40 basis points of additional FX impact which is aligned.
Speaker Change: Somehow an impact.
Speaker Change: I think that it's good to see sequential growth.
Speaker Change: into Q3, into Q4, and also of course during Q2 as well. So I think we need to focus on that while we continue to complement, to increase, to strengthen our service offering, to keep on expanding globally, to be able to tap into new markets.
Speaker Change #102: What is happening in Mexico, Colombia, and a little bit in Brazil.
Speaker Change: and I think that will help us to continue delivering industry-leading growth. But, you know, let's wait a little bit to put numbers for next year.
Speaker Change #103: Would part of that impact is that we were able to increase our operating income guidance for the year, we moved out of 14, and a half to 15 and a half where now at 15% to 15, 5% for the year and also the guidance for the third quarter.
Speaker Change: Thank you, Arvind. Just as a reminder, please limit yourself to one question, please. The next question comes from the line of Sean Kennedy from Mitsuho. Sean, please go ahead.
Sean Kennedy: Hi, everyone. Thanks for taking my question.
Speaker Change #103: And basically the same one four for the fourth quarter the implied guidance there is 15% to 16% so.
Sean Kennedy: So there were reports that a large sports organization was looking to raise a significant amount of money to enhance and expand its direct-to-consumer streaming service. So my question is, broadly speaking, is that a theme that you're seeing in digital experiences across your customers, a second investment wave in TTC streaming?
Speaker Change #103: That's the overall picture in terms of FX impacts in this quarter and I know Marty if you want to talk a little bit.
Speaker Change #103: The main reason I think why the industry is let's say.
Speaker Change #103: Last two minus two or minus five.
Sean Kennedy: Welcome back everyone. Sierra here to the fold for you. We'll get started in exactly one minute and I'll give you a minute to go ahead and start the live stream. So this is awesome. sorry about that so so um I mean other blah blah
Speaker Change: We are seeing a lot of things happening in the entertainment space. There's a lot of companies trying to reinvent the way they connect with their consumers. And we're seeing that.
Speaker Change #104: And we're still growing at very healthy rates is that the decisions that we took in the past I mean, when when we say that the vision. We have is to try to leverage our relationships and being able to sell every every day more things to our beloved customers is.
Speaker Change: Specifically on the subject that you mentioned, I have no specific answer to give you.
Speaker Change: But yes, in general, on the media and entertainment space, a lot of things are happening. I don't know, Diego, if you want to add up on that. Sure. Direct to consumer within the media and entertainment, you know, it's a trend. Disney is doing exactly that.
This is extremely powerful when you when you take it in the long run and we have been executing that in a pretty consistent murder. This the SEC.
Speaker Change #104: <unk> recently is that we have been expanding into markets in which.
Speaker Change #104: We were not present before so.
Speaker Change #104: Now we are entering you know a big tying into the middle East.
Diego Tartara: even though they are also consolidating different channels. Within the sports, yes, direct-to-consumer.
Speaker Change #104: Is there some other countries and in Oceania in Asia, and that is providing us like an additional you know fuel for growth that we didn't have before so when you add up those two things plus the organic growth of our largest customers, which is still very healthy then.
Diego Tartara: It is a trend. This is actually a public. Many different sports organizations are exploring that. FIFA, of course, being one of them and is one of our clients.
Diego Tartara: Formula Formula 1, 2. So yes, direct to consumer. It's that my my only.
Speaker Change #104: Then you have a performance, which is pretty different from the rest another way to understand that could be to say that globally.
Diego Tartara: Question mark on that, and this is actually, we still have to see, is that the month looks for consolidation, and so we'll see how those things play together.
Speaker Change #105: Gaining market share while the market is not growing and you're still growing then you're winning market share and this is extremely important for us and also the revenue per head when you see the revenue per head that slogan that one explained before you see it increasing to two very good I'm very healthy levels that is a testimony of the buyer.
Speaker Change: Great. Thank you. Nice job on the quarter.
Speaker Change: Thank you very much.
Speaker Change: The next question comes from the line of Surrender Singh from Jeffries. Surrender, please go ahead, your line is open.
Speaker Change #105: That we're delivering to our customers.
Speaker Change #105: On top of all that.
Speaker Change #105: Very strong growth in the AI space that we have been preparing for the last.
Surrender Singh: Thank you. Diego, this question is for you, actually. Just following up on earlier commentary about just kind of the productivity improvements and some of your internal AI initiatives.
Speaker Change #105: 10 years, So I think that's a good summary of the reasons why globally is growing fueled by a very powerful culture by.
Surrender Singh: You mentioned the disconnect between what's kind of in the public space between what you're seeing
Speaker Change #105: And at very high ambition of reinvent the way that technology is being created.
Surrender Singh: Can you provide any incremental color there in terms of what estimates or measurements that you've done? I mean, I remember when we talked about it last year, you talked about potentially getting to about a 15% productivity improvement, so just any color would be okay.
Speaker Change #105: Reinvent the way that we connect with our globus with our customers, where they will all our stakeholders. So we're extremely happy with the performance and we will keep on.
Speaker Change #105: Hopefully.
Speaker Change #105: Driving that kind of performance for next year too.
Speaker Change: Yes, that is correct. So, but actually, when I say those numbers, I was, like everyone was looking for, like everyone else is saying 50% now, everyone is talking about around those numbers for a productive environment. So, I don't want to...
Speaker Change #106: Okay perfect. Thank you and that's it.
Speaker Change #107: One quick one if I can as I'm looking at bookings growth of 17%, which is faster than.
Speaker Change #108: Organic constant currency revenue growth.
Speaker Change #109: And bookings comes with various duration, but but.
Speaker Change: technical and bore everyone, but there's not only
Speaker Change #110: The faster sort of bookings does that suggest that that next year, you should be seeing acceleration in the business.
Speaker Change: It's not only a measurement of a performance of the individual, increased performance of the individual. It's like collective performance and what it means for the teams. We've seen improvement
Speaker Change #109: Revenues.
Speaker Change #109: I think it's still early.
Speaker Change #109: Regarding 2025.
Speaker Change #109: In detail I mean, there's a lot of things going on around the world <unk> rates and a lot of things that will have somehow an impact I think that it's good to see sequential growth into Q3 into Q4.
Speaker Change: major improvement in more junior type of developers and more senior type of developers.
Speaker Change: not quite relying on those tools so heavily.
Speaker Change #111: And also of course during Q2 as well and so I think it's a we need to focus on that one we continue to complement to it to increase to strengthen our service offering to keep on expanding globally to be able to tap into new markets.
Speaker Change: But the problem with junior developers is that it brings
Speaker Change: very good quality code compared to what they would have done without those tools.
Speaker Change: But if you see it as a unit, it's like a car spare part, it looks super good, but it doesn't fit the car. So it's kind of tricky. What's important to us is overall team performance.
Speaker Change #111: And I think that will help us to continue delivering industry leading growth.
Speaker Change #111: That's where the leery to put numbers for next year.
Speaker Change #112: Thank you Robyn just as a reminder, please limit yourself to one question. Please.
Speaker Change: It's not individual and we're measuring like things that when you put all of that together they don't necessarily add up
Sean <unk>: The next question comes from the line of Sean <unk> from Mizuho. Please go ahead.
Speaker Change: I think, with regards to that, Asians play...
Speaker Change #114: Hi, everyone. Thanks for taking my question. So there were reports that a large sports organization I was looking to raise a significant amount of money to enhance and expand its direct to consumer streaming service. So my question is broadly speaking is that a theme that you're seeing in digital experiences across your customers.
Speaker Change: play better as they fully optimize complete flows, and which is what we're actually trying to do and what's interesting.
Speaker Change: Numbers, like I said, I can confirm that it's
Speaker Change: for developers, which is typically...
Speaker Change: What you're trying to explore for code generation, the tooling will give you an improvement around, it's actually even lower than 15%, tools such as Copilot. But for some individual tasks, such as unit testing, it's super high, like 40% improvement for that specific type of task.
Speaker Change #114: Second investment wave in TTC streaming.
Speaker Change #114:
Speaker Change #114: We are seeing.
Speaker Change #115: Like a lot of things happening on the entertainment space, There's a lot of companies trying to reinvent the way they connect with their consumers.
Speaker Change #115: And we're seeing that.
Speaker Change #116: Specifically on the on the subject that you mentioned I have no specific answer to give you, but yes in general on the media and entertainment space a lot of things are happening I know deal. If you want to add up on that sure.
Speaker Change: So, yes, I can confirm what we started talking a few quarters back.
Speaker Change: Still, I think there's a lot of room for improvement towards the future. We'll see how it develops. We're pretty confident that we're headed in the right way, in the right direction, sorry.
Speaker Change #117: So I'm sure you remember within the media and entertainment.
Speaker Change #118: It's a it's a trend Disney is doing exactly exactly that.
Speaker Change #118: Even though they are also consolidating different channels within the sports, yes, the direct to consumer.
Speaker Change: Thank you very much, Sarinder. The next question comes from the line of Leonardo Olmos from UBS. Leonardo, please go ahead.
Speaker Change #119: It is a trend.
Speaker Change #120: This is actually.
Leonardo Olmos: I have real and congrats on the great results.
Speaker Change #121: Our public many a different sports organizations are exploring that FIFA of course, being one of them and us.
Leonardo Olmos: So my question is regarding the utilization rate. We saw another improvement quarter on quarter And also an impressive reduction on the attrition rate, right? What we've been seeing with several of our other companies you cover here such as Accenture is an improvement overall in IT services
Speaker Change #121: One of our clients so.
Formerly a formula one two so yes direct to consumer is that my my only question Mark on data and this is actually.
Speaker Change: Do you think there could be, at some point, could be...
Speaker Change #122: It's Oh, we still have to see is that the month looks for consolidation.
Speaker Change: an increase back again on the attrition rate or the demand for for developers? How is your idle capacity regarding that? What do you expect for for the second half of 2025 in that sense? Thank you.
And so so we'll see how those things play together.
Speaker Change #123: Great. Thank you nice job on the quarter.
Speaker Change #124: Thank you very much.
Speaker Change: Yes, sorry. Well, what we are seeing right now in terms of the attrition, as you mentioned, is...
The next question comes from the line of Surinder Singh from Jefferies, Sir and there. Please go ahead. Your line is open.
Speaker Change: is pretty low right now. Of course, it has been raising a little from the last quarter, but
Speaker Change #125: Thank you.
Surinder Singh: This question is for you actually just following up on earlier commentary versus kind of the productivity improvements and some of your internal AI initiatives. You mentioned the disconnect between what kind of in the public space between what you're seeing.
Speaker Change: We're still in very low rates.
Speaker Change: What we're seeing is that the demand is still very very high for us, so we continue hiring in many of the countries that Juan explained before. We are very strong in La Tama, as we have been in the last couple of years, and of course India is another of the of the places that where we're growing.
Surinder Singh: Can you provide any incremental color there in terms of what they're saying Mercury measurements that you've done I mean, I remember when we talked about it last year, you talked about potentially getting to about a 15% productivity improvement so just any color.
Speaker Change: In terms of the people, even what we are seeing for the rest of the year is much pretty stable numbers and probably, I mean, we, of course, the market is still growing, as you mentioned, but we have a great culture. The people that stay in with, they're very happy in all the polls and the interviews that we're making with our glovers and the culture that we have is really appealing for the new generations and the engineers and talent and designers. So I think that from global perspective, I mean, these numbers are pretty stable and we continue doing different kind of things in order to have the same kind of numbers that you are seeing now.
Yes that is correct, so so, but but actually when I say those numbers I was like.
Speaker Change #127: Like everyone was looking for like everyone else is saying, 50% now everyone is talking about around those numbers for a productive environment. So I don't want to.
Speaker Change #128: B Super technical and bore everyone. But are there is there is there is not only.
Speaker Change #129: It's not only a measurement over performance of the individual increased performance of the individual is like collective performance and what it means for the teams we've seen improvement a major improvement in our more junior type of developers and a more senior type of developers now quite rely on.
Speaker Change: Thank you Leo. The next question comes from the line of Thiago Kapuskis. Thiago, please go ahead.
Thiago Kapuskis: Hi guys, thanks a lot for the question. I have a follow-up on the AI part.
Speaker Change #130: Those tools are so heavily but the problem with junior developers is that it brings very good quality cold compared to what they would have done without those tools, but if you said Oh say units like a it's like a car spear, but it looks super good but it doesn't fit the car.
Thiago Kapuskis: Just to get it clear.
Thiago Kapuskis: My guess from what you guys said is that it's a long cycle, right?
Speaker Change: You have data migration, you have...
Thiago Kapuskis: task approving, etc. I just want to understand a little bit better how you envision the cycle. Is it like a
Speaker Change #131: So so it's kind of a it's kind of tricky what's important to us each overall team performance. So not the individual and we're measuring like are things that when you put all of that together they don't necessarily add up Ah I think with regards to that Asian supply play.
Thiago Kapuskis: three years, a five year cycle. How, what needs to happen for the budgets to ramp up? Is it just about testing and getting a concept, a hypothesis proven, and then there's a ramp up?
Speaker Change #100: is it a data like kind of bottleneck like the data bottleneck is as bad as it was in the previous cycle I don't know if you could provide us some details there just to get a little bit better framework of the cycle there it would be great.
Speaker Change #131: You better have the fully optimize our complete flows and which is what we are actually trying to do and what's interesting.
Speaker Change #132: Numbers like I said I can't confirm that it's for developers, which is typically a what do you. What are you trying to exploring cogeneration Ah. The tooling will gave you unimproved around it's actually even lower than 15% tools, such as our co pilot, but for so.
Speaker Change #100: I would take the first part and then I will let Diego. Look, these projects, I think the most time now is being spent on finding the use cases.
Diego Tartara: and finding and validating the use cases. Once the use cases are validated.
Speaker Change #133: Individual tasks such as a unit testing is super high like 40% improvement both for that specific type of task. So yes, I can confirm.
Diego Tartara: Then it takes a little bit longer than everybody expects regularly using ChatGPT, right? I mean, but it takes much longer to have an enterprise-grade application based on that information.
What are we started talking a few quarters back and.
Speaker Change #133: Steel.
Speaker Change #134: I think theres, a theres a lot of a room for improvement are towards the future. We'll see how it develops we're pretty confident that we're headed in the right way.
Diego Tartara: Also, data projects are projects that
Diego Tartara: For many years has been delayed and everybody was talking about AI but really not getting real effects on that. So I think
<unk> sorry.
Speaker Change #101: Data projects are being accelerated these days.
Speaker Change #135: Thank you very much there in there. The next question comes from the line one another almost from UBS.
Speaker Change #101: I don't think they're a bottleneck. I think it's more like a maturity process that needs to go through a corporation until the use case is detected, the use case is proven, and then the use case is scaled.
Speaker Change #135: Please go ahead.
Speaker Change #136: Hi, everyone and congrats on the great results. So my question is regarding the utilization rate, we saw another improvement quarter on quarter.
Speaker Change #101: and that may take, you know, maybe one year, two years. We don't know exactly.
Speaker Change #137: And also an impressive reduction on the attrition rate right.
Speaker Change #138: What was being seen with several of our other companies you cover here such as Accenture is an improvement overall in AG services.
Speaker Change #101: Um...
Speaker Change #101: Following other cycles, it has taken much longer, but I think these cycles will be much shorter than that. But still, it's unclear when those things are going to start to happen at a larger scale.
Speaker Change #139: Do you do you think there could be a at some point could be an increase back again on the attrition rate or the demand for for developers. How is your idle capacity regarding debt. What do you expect for for the second half of 'twenty five in that sense. Thank you.
Speaker Change #101: We are ended up using AI in pretty much everything we do. And we have been using it in the past.
Speaker Change #101: and now even more with the agents, with the acceleration platforms that we have.
Speaker Change #101: with the automation of...
Speaker Change #140: Yes, I'm sorry.
Speaker Change #101: many of the staffing processes that we have at Globan, how to connect people with projects. So I think in the same way we are doing at Globan, there must be...
Speaker Change #139: Sorry.
Speaker Change #141: Well, we are seeing right now in terms of the attrition is actually lower manganese is pretty low right now.
This has been raising a little from the last quarter, but whereas helium in in very low rates and what we're seeing is that the demand is still very very high for us. So we continuous hiring in many of the countries. That's why I explained before we are very strong in Latam as we have been in the last couple of years and of course at <unk>.
Speaker Change #101: And by the way, we launched AI Reinvention Studios for many of the industries in which we operate. And the aim of these AI Reinvention Studios is very simple and clear, which is...
Speaker Change #101: We need to provide to our customers proactively a list of how to use AI in every single area of that specific industry.
Speaker Change #142: India is another of their of the places where we're growing in terms of the that people. Even what we are seeing for the rest of the year is much pretty stable numbers and probably I mean, we of course had the the market is still growing as you mentioned, but we have a great culture that people are staying with it.
Diego Tartara: And that's a mandate we have in our company. That's a mandate that Diego has as a CTO of the company to keep on creating those use cases and to accelerate our customers to be more productive the sooner the better. But Diego, do you want to expand on that? Yeah, sure. So going back to the original question, there's a yes when it comes to...
Speaker Change #143: They have been in in all the then then the pulse in the interview that we are making with our collaborators and the culture that we have is really appealing for the new generations and their engineers and talent and designers. So I think that in from a global perspective, I mean, these numbers are pretty stable and we continue doing different kinds of things.
Diego Tartara: data, not as a blocker, but as a first step.
Diego Tartara: towards actually embracing more AI-related projects. Lots of our clients are actually taking care of that.
Speaker Change #144: Are there too to have the same kind of numbers that you are seeing now.
Diego Tartara: So we've been seeing an increase on the data architecture demand and this is for covering their their whole data strategy I think it was lots of companies did not
Lou: Thank you Lou.
Telco Costless: The next question comes from the line of Telco Costless, though.
Speaker Change #147: Please go ahead.
Diego Tartara: take good care of that aspect, and they are now identifying the need, so that's the first thing.
Speaker Change #148: Hi, guys. Thanks, a lot for the question I have a follow up on the on the AI part just.
Telco Costless: Just to get it clear I My guess from what you guys said is that it's a long cycle right. So you have data mcgrane migration you have passed approving et cetera, just wanted to understand a little bit better how you envision that the cycle is it like a three year, it's a five year cycle.
Diego Tartara: them
Diego Tartara: Also, lots of customer engagement. We've been talking about that. And when we used to say, you know, the POCs, exploratory work, etc., etc.
Speaker Change #102: It had to do a lot with newer technologies, like Gen AI. How do I use this? I see that it's super powerful. How do I make it?
Speaker Change #102: a productive tool, an enterprise-grade tool, and that for that we have a solution and an approach and a go-to-market approach. But the most interesting thing is actually what Martin said, which is identifying industry solutions.
Speaker Change #149: How what needs to happen for the budgets to ramp up is it just about testing and getting our cost up the hypothesis proven and then there's a ramp up is it a data lake kind of bottleneck like the data bottleneck is as bad as she wasn't the previous cycle I don't know if you could.
Martin: What are the things, I mean, given this technology, if I think on...
Martin: a certain vertical landscape, what are the opportunities there? What can I optimize? How can I capture more clients? How can I change my loyalty program? How can I optimize my marketing campaigns? How can I change my acquisition funnel?
Speaker Change #149: Provide us some details there just to get a little bit better framework of the cycle there it would be great.
Speaker Change #149: Yeah, what I would take the first part and then I'll, let you.
Speaker Change #150: Look these projects.
Speaker Change #151: I think that the most time now is being spent on on finding the use cases.
Speaker Change #103: There's a lot of things in every single industry has a ton of problems, right? They spend a lot of money I don't know, pharmaceutical companies spend a lot of money in research and attrition for experimentation and
I'm, finding and validating the use cases once the bulk the case they use cases are validated.
Speaker Change #152: Then it takes a little bit longer than then with everybody expects using regularly using chat CBD right I mean, but it takes much longer to have an enterprise grade.
Speaker Change #104: we can now address those industry pains with AI solutions. This is a very powerful tool. So that's what we're doing.
Speaker Change #153: Application based on that information also data project or projects that.
Speaker Change #153: For many years has been delayed and everybody was talking about AI, but really not getting real effects on that so I think data projects are being accelerated these days.
Speaker Change #105: Excellent. Thank you so much.
Speaker Change #105: Thank you very much, Tao. So that will be all for the Q&A section today. Thank you all for joining, and now I will hand it off to Martin for some closing remarks.
Speaker Change #154: I don't think they are a bottleneck I think it's more like in maturity process that needs to go through a corporation until they use cases detected they use cases proven and then they use cases for scaled and that May take you know, maybe one year or two years.
Martin: So thank you very much. Thank you very much, everyone. Thank you for support and coverage. I'm looking forward to see you next quarter. Cheers, bye bye. Thank you. Bye. Bye.
Speaker Change #106: Special thanks to all these amazing people Thanks to Diego Tartara, Patricia Pomies, and Paul Angy Major훍иберфиэр móșlan
Speaker Change #154: We don't know exactly.
Speaker Change #154: Following other other cycles. It does take much longer but I think this cycle will be much much shorter than that.
Speaker Change #106: Thank you for watching
Speaker Change #154: It's unclear when those things going to start to happen at a larger scale now.
Speaker Change #155: We are ended up using AI and pretty much everything we do is we have been using it in the past and now even more with the agents with the acceleration platforms that we have with the our donation of many of the of the staffing processes that we have a global work how to connect people with projects. So I think <unk>.
Speaker Change #155: Same way, we are doing at Logan the must be.
Speaker Change #106: [inaudible]
Speaker Change #155: And by the way we launched.
Speaker Change #106: that
Speaker Change #155: AI revenge and studios for many of the industries in which we operate and the aim of this AI reinvention studios is very simple and clear which is.
Speaker Change #106: [inaudible]
Speaker Change #107: Unknown Interpretation
Speaker Change #107: And we have this guy.
Speaker Change #107: really a very failed state who's had a terrible career.
Donald Trump: I mean you have him saying they're weird. No, he's a weird guy and She's weird in her policy who wouldn't want to have strong borders. Who doesn't want to have lower taxes, you know all my life I've watched as politicians campaigned and I've always been on you know for the most part on the other side on the side that these people are on and They always talked about we're going to reduce taxes
Speaker Change #155: We need to provide to our customers proactively.
Speaker Change #155: At least.
Speaker Change #155: How to use AI in every single area of that specific industry.
Speaker Change #156: And that's it that's a Monday, we have in our company that's embodied the Diego has as the CTO of the company to keep on creating those use cases and two accelerated our customers to be more productive L. A the sooner the better but David do you want to expand on that yes, sure. So going back to the original question Theres a theres a yes when it comes to.
Donald Trump: This is the only campaign I've ever heard where they're saying, we're going to increase your taxes.
Donald Trump: And then people say they're going to vote for her? I don't know. So I don't think so. I don't think people know who she is yet. When people, because really people didn't know.
David <unk>: Data not as a blocker, but as a first step towards.
Donald Trump: You can ask the man on the street.
Speaker Change #157: The worse, Oh actually embracing more AI AR related projects a lot of our clients are actually taking care of that so we've been seeing an increase on the data architecture of the month and this is for covering their their whole data strategy.
Speaker Change #109: I saw it on one of the shows today. They asked the man in the suit, what's the last name of Kamala? Nobody knew. It's Harris. Nobody knew the last name.
Speaker Change #109: I don't even use it because nobody knows who I'm talking about. People don't know who she is. She's a radical left socialist. But beyond that, I mean, she's way beyond socialism. Who's going to destroy our country? And
Speaker Change #158: It was a lots of companies did not.
Speaker Change #158: Take good care of that aspect in there now identifying the need so that's our that's the first thing.
Speaker Change #109: When they find out, I think you're going to see something. But right now, even not knowing her, and with all of the... like the cover of Time magazine...
Speaker Change #158: Then Oh, there's also lots of customer engagement, we've been talking about that and when when we used to say to you know the POC as exploratory work etcetera etcetera. So it has to do a lot with the newer technologies like a journey of how do I use. This I see that is super powerful how do I make it a proactive too.
Speaker Change #109: They didn't put a picture, they got a great artist to do it. What was that all about, you know? What was that all about? The whole thing is crazy. I just want to win for the country.
Speaker Change #109: Some people say, oh, why don't you be nice? But they're not nice to me. They want to put me in prison, just so you understand. They tell me I should be nice. They want to put me in prison. It's never happened before in the history of our country. I did nothing wrong.
Martin: Enterprise grade tool in that for that or we have a solution and an approach and a go to market approach, but the most interesting thing is actually what Martin said, which is identifying industry solutions. What are the things I mean, given this technology, if I think on a certain.
Speaker Change #109: I have crooked judges, I have crooked prosecutors, and they're all Democrats, all Democrat areas other than in Florida where you had a brilliant judge.
Speaker Change #160: Berke vertical landscape what are the opportunities there what can I optimize how can they capture more clients how can I change my loyalty program, how it how can I optimize my marketing campaigns, how can I change my acquisition funnel. So theres still a lot of things are in every single.
Speaker Change #109: who ruled in my favor. I won the case, the documents case, won it in its entirety. And Jack Smith, deranged Jack Smith.
Speaker Change #109: suffered a defeat. But in New York City, everything's clubhouse. I know it very well. I grew up there. I know it very well. And we have a very crooked system, and it's one of the reasons that New York is dying. Nobody wants to come in. No companies want to come in because the courtroom system is so corrupt.
Speaker Change #161: Industry has a ton of problems right. They spend a lot of money I don't know pharmaceutical companies spend a lot of money in our research and our attrition for experimentation and.
Speaker Change #109: both at a federal level and at a state level and a city level.
Speaker Change #110: and they put you into an area where you have 3% Republican vote. It's all a rigged deal, just like Fannie. F-A-N-N-I, Fannie, with her boyfriend.
Speaker Change #162: We can now address those industry pains with AI solutions. This is a this is a very powerful tool. So that's what we're doing.
Speaker Change #111: And I think that's been discredited, too.
Speaker Change #163: Excellent. Thank you so much.
Speaker Change #163: Thank you very much so so that will be all for the Q&A section today.
Speaker Change #111: a little bit nasty. They want to put me in prison, me. They want to put me. It's never happened before in the history of our country. It's happened in third world countries.
Speaker Change #164: Thank you all for joining and I'll hand, it off the market from some for some closing remarks.
Speaker Change #111: But it's never happened here and they're in danger because you create a precedent for doing that and once that happens, that's a That's a really bad thing. You know when and the years before and I've said this a few times not too much but with Hillary she
So thank you very much. Thank you very much everyone. Thank you for support and coverage and looking forward to see you next quarter Cheers Bye bye. Thank you bye bye.
Speaker Change #164: [music].
Speaker Change #111: was subpoenaed by Congress to give everything she's got.
Speaker Change #111: and she burned it, she acid washed it.
Speaker Change #111: Bleach Pit, they call it.
Speaker Change #111: totally scrubbed it, and then they broke everything with hammers.
Speaker Change #111: with fire, they burned it.
Speaker Change #112: And then she said, I don't have anything. Well, it turned out that she had a lot to give.
Donald Trump: and everybody said, lock her up, lock her up, and I used to go easy, just easy, easy, then we won.
Donald Trump: And I said, wouldn't it be terrible? And you know, I lose, some people are upset when I did this, but you have to look at it maybe differently now. I say, wouldn't it be terrible?
Speaker Change #164: Yeah.
Donald Trump: to put the wife of the President, former President of the United States, into a prison. Now think of that. Hillary Clinton, she was Secretary of State, she was the wife of...
Donald Trump: a President of the United States who used to be a friend of mine before I ran for you know for politics He was a friend of mine used to play my golf course all the time I have a great golf course right next to their home in Westchester used to be there all the time is his favorite course But you know what?
Speaker Change #113: I could have done that very easily. She was so guilty.
Speaker Change #113: and I said to my people, wouldn't it be terrible to put, I don't know, wouldn't it be terrible to take, and we won the election, wouldn't it be terrible to take a former Secretary of State who was the wife of the President of the United States and put her into a prison?
Speaker Change #113: But that's what they want to do with me, and I did nothing wrong. It's all crooked politics and really crooked judges.
Speaker Change #113: Do you know I have a gag order? Do you know I can't even talk about it right now? Do you know that I have a judge?
Speaker Change #113: who has a gag order. He doesn't want me to talk and the reason he doesn't want me to talk is because what I say is so devastating.
Speaker Change #113: and so horrible for him.
Speaker Change #113: But think of it, I have a gag order, there's never been a politician in history, I mean probably for any politician for a city council office.
Speaker Change #113: I'm the leading candidate.
Speaker Change #113: to be president.
Donald Trump: I won virtually unanimously and I beat everybody the quickest it was the quickest primary in history there's never been one that was done so early
Donald Trump: I had people that were very talented people and I beat them by 45, 50, 60, 70, 80 points. There was never a close race. Nobody was even close.
Donald Trump: Good talent, they weren't close. And I'm running.
Donald Trump: against the Democrats. So it's a two-party system whether we like it or not. Republican, I'm the Republican and I'm leading but let's say I'm tied but I'm leading. I believe I'm leading by a lot more than people think and I believe we'll be leading by a lot more.
Donald Trump: and I have a judge who put a gag order on me. So when you ask me a question or when you ask me a question,
Donald Trump: I can't give you an answer because if I give the answer they want to put you in jail. He said we'll put him in jail if he talks beyond the gag order. And this is in a state where unfortunately the laws have been very bad and they haven't been upheld.
Speaker Change #114: by the appellate divisions generally, although I have one case where we
Speaker Change #115: Judge, a certain judge, I won't use names, but the Attorney General case where we won
Speaker Change #115: Five appeals on the same case, the most ever, it was a ridiculous, horrible decision where you have a very, very biased voting population and a judge whose hatred of Donald Trump was beyond belief.
Speaker Change #115: and we won the case, but he ruled a ridiculous amount of money, civil case. Ruled ridiculous. Now this is a, what they're doing is interference with an election.
Speaker Change #115: They want to interfere. Look at the one thing they want to sentence right before the election takes place. Let's sentence him Because who's going to vote for him if we sentence him? Let's sentence him right before. Now, this is interference
Speaker Change #115: with a presidential election at a state level and it's a state that always goes
Speaker Change #116: Democrat. It's interference and as you know the Supreme Court ruled recently on immunity and I'm immune from all of this stuff that they charged me with.
Speaker Change #116: But isn't it a terrible thing? And yet Hillary Clinton, when it came time to make a decision, I said, I don't want to put the wife of the President of the United States in prison. I want the country to come together and to be unified.
Speaker Change #116: And here it is a few years later, and these people...
Donald Trump: Say, let's put him, why? Because I challenge an election? Because I want to challenge an election?
Donald Trump: some other reason. It's a really disgraceful thing. It's a shame. And it's a very dangerous thing for both parties because once they start that ball rolling, once they started rolling, that's a that's a nasty ball. Yes, please.
Speaker Change #117: Nikki Haley told our Bret Baier that Republicans need to stop whining about Kamala Harris. Focus on courting those independents, those suburban women.
Speaker Change #118: the moderates out there. What do you think of that strategy and would you consider having Nikki Haley on the campaign trail with you? Sure, I think that we've done very well.
Speaker Change #119: I think that we're hitting a nerve. I think this is a different kind of a race. All we have to do is define our opponent as being a communist or a socialist or somebody that's going to destroy our country. You know, I fought Nikki very hard. I beat her in her own state by...
Speaker Change #119: legendary numbers, and I get along with her fine. I appreciate that she endorsed me and all of that. No, I think that
Speaker Change #119: I think relatively to what they're doing and how radical they are and how in many ways how sick they are I think I'm doing a very calm campaign. I mean we're here. There's no shouting now You'll say he ranted and raved but not you but some of you will say he ranted and raved I didn't rant and rave. I'm a very calm person believe it or not if I wasn't
Speaker Change #120: probably wouldn't be around anymore you know probably wouldn't be around but no I think I appreciate her advice I have to do it my way you know I ran against her
Speaker Change #120: and I did it my way. People said I should maybe do it a different way, but...
Donald Trump: I won in South Carolina by numbers that nobody's ever seen before, you know, it wasn't even close.
Donald Trump: and I think she's a good woman. I'd love to have her support. Yeah, she gave me support, but I'd love to have her go around and campaign.
Speaker Change #121: You mentioned this in your remarks, Vice President Kamala Harris wants to put a ban on price gouging. Do you think that the federal government should be responsible for determining food prices? Well, not only responsible, they probably can't do it legally, and that will drive up prices.
Speaker Change #122: She wants no fracking. Now she may go and change that, I think she's already changed it, but she wants to have no fracking. I want no fracking.
Speaker Change #123: but for her whole life.
Speaker Change #124: She said that. No fracking. Then about, I don't know when, a couple of months ago, all of a sudden, when she started looking at polls. Remember this, she all of a sudden says fracking.
Speaker Change #124: I don't think any... I won Pennsylvania and I did much better the second time. I won it in 2016, did much better the second time. I know Pennsylvania very well. I don't think there's any way in hell...
Speaker Change #124: That's somebody that's intelligent, living in Pennsylvania, is going to vote for somebody that basically will eventually end fracking, end fossil fuel.
Speaker Change #124: So, whether it's Oklahoma or Texas or Pennsylvania, a big energy state, people don't realize that 350,000 people work in that industry. But maybe more importantly, they don't want to pay $9 a gallon for gasoline.
Speaker Change #125: So, no, I think that she's made statements. I don't know how you get out of it. I don't know how you can say for 10 years, there'll be no fracking. I mean, we have tapes of her laughing at the stupidity of the question.
Speaker Change #126: Of course I'm not going to allow fracking. Then all of a sudden a few months ago, she comes out in favor of oh, yes I'd allow fracking.
Speaker Change #126: I don't think anybody in Pennsylvania will be... I think she's going to do very badly in Pennsylvania.
Speaker Change #127: You have to frack. We need the energy and Pennsylvania needs the jobs, but Pennsylvania needs the energy also. That energy is going to support our new system for AI and all of the other modern things that that need massive amounts of electricity and energy, massive.
Speaker Change #128: So it's a very good question actually, but we have to we have to unify as a country We have to come together and I think we can you know I get that question oftentimes and I used to think maybe there's no way because you know Some people want a border or some people don't want a border. Most people do want a border
Speaker Change #128: But there's such a difference in people.
Donald Trump: But just before COVID coming out, so three years, we went a long period of time, and we had an economy going, the likes of which no country had ever seen before. I think you would agree there's never been anything like it. And people were coming together.
Donald Trump: People were calling me very, I would call them radical left.
Donald Trump: But I would say very liberal people, very progressive people. They came to me. We would like to get together. In fact, we worked out criminal justice reform. I was the only one that could have done that. I won criminal justice reform and I got that for black leaders that came to see me. Criminal justice reform.
Donald Trump: Obama couldn't do it.
Donald Trump: Biden wouldn't even try, but nobody could do it. I got that done and I got conservative votes to get it done. They needed at least five very conservative votes. It was very hard to do. I got that done.
Donald Trump: Our country was coming together and, you know, I can tell you the story of criminal justice reform. When you do that, that means that's a big step.
Speaker Change #129: But I was seeing people that were not seeable, that I wouldn't want to see them and they wouldn't want to see me.
Speaker Change #129: And all of a sudden we were having, I was having lunch with people that, if I told you who they were, you wouldn't even believe it. Our country was coming together.
Speaker Change #129: Success was bringing our country together.
Speaker Change #129: and it can be done. Success will bring our country together again.
Speaker Change #130: It can be done. It was an amazing phenomenon. And I used to say, I don't know, it's awfully tough to get it together. I've never seen anything like it. Like, for instance, me getting criminal justice reform done. And I did that with Democrats and some very conservative
Speaker Change #130: Republicans who said it's very unfair where people are staying in jail for 35 40 years and today they wouldn't even be charged with a crime for what they did and we got it done and I was very proud of it but our country was coming together
Speaker Change #130: The black population had the best numbers they've ever had on jobs, on income, on everything.
Speaker Change #130: The Hispanic population had the best numbers, Asian population, men, women, young people with diplomas from
Speaker Change #130: the best schools, Harvard, MIT, the Wharton School of Finance, they're all coming together. And everybody was happy. And young people without a high school diploma.
Speaker Change #130: The best MIT students and people without a diploma were all working. They were making more money than they've ever made. There wasn't one group that wasn't doing better than it was.
Donald Trump: the year before, two years before or ten years before. It was the best our country had ever do and we were leapfrogging China. China didn't have a chance. I took in hundreds of billions of dollars in tariffs.
Donald Trump: from China. Hundreds of billions of dollars. No president ever took in ten cents. And what happened was an amazing thing. We had a great successful country and our country was unifying. It was the first time anyone's seen it, but our country was unifying.
Speaker Change #131: Some of the polling out there, I know you're saying that you're leading in some polling, but there is other polling out there. A Fox News poll out just yesterday has you up by just one point. How do you break away? And Fox News has always been my worst poll.
Speaker Change #132: Believe it or not and even Fox News had me up by one or two points yesterday came out. I think two points one point
Speaker Change #132: I also think, you know, I tend to poll low.
Speaker Change #132: In some cases, really low. You know, in 2016, I was polling low because people didn't want to say who they're voting for. I don't know if that's supposed to be a good thing or a bad thing, but it is what it is. And we did very well in 2016, and we did much better in 2020. Much better, but bad things happened.
Speaker Change #133: Through COVID, bad — very bad things happened, so we're not happy about that. Yes, I've seen you around a little bit, so go ahead, please. The Press Thank you, Mr. President. The President Thank you. Thank you very much. The Press Thank you. So, you talked about how COVID from China was a fence too far. What's your plan for holding China accountable if you get reelected?
Speaker Change #133: Well, I want to get along with China
Speaker Change #133: I had a great relationship with President Xi. We made a fantastic trade deal. $50 billion of farm products and manufacturing products they had to buy here and they were adhering to it. They don't adhere to it anymore because they don't respect Harris or Biden. But as you know, we signed a trade deal with China.
Speaker Change #133: And it was actually better than even the USMCA. It was a great trade deal. China had to buy $50 billion, not $15 billion, not anything else. $50 billion.
Speaker Change #133: and it was a great trade deal. I think that that's one of the underrated things. I think we'll have a great relationship with China. I hope we're going to have a great relationship, but it's got to be a fair relationship. China was taking advantage of the country for years, but so was every other country in all fairness to China. Every single country was taking advantage.
Speaker Change #133: United States. I can't think of one country where
Speaker Change #133: We were doing better than them. Japan was taken. Abe was my dear friend, one of the great men, great leader. But all of these countries were... I used to say, who signs these agreements? Actually, it's amazing that we economically survived.
Speaker Change #133: because we had such bad negotiators, or...
Speaker Change #133: people were getting paid off. I actually looked at some deals. I'd say nobody could be so stupid to sign a deal that's one so one-sided. Whoever made this deal has been paid off. And then I'd look into it a little bit. Yeah. And all of a sudden he's working as an agent for that country.
Donald Trump: Three years later, five years later, now we change a lot of those deals. South Korea, we changed the South Korea deal. We made it from a horrible deal to a good deal. I changed the Japan deal. But I made a great deal with China. They had to buy $50 billion worth. They never bought anything like that.
Donald Trump: In fact, it was a misunderstanding.
Donald Trump: When I said to people in negotiating, what number are we talking about?
Donald Trump: They said 15. I thought they said 50. So when they came back to me, they said, sir, we're all set to get it going
Donald Trump: I said, good, what's the number? 15. I said, you told me 50. Why are we going down to 15? They said, no, we said 15. I said, you told me 50. Actually, I heard them wrong.