Business transformation services company Genpact (NYSE: G) announced better-than-expected revenue in Q2 CY2026, with sales up 7.1% year on year to $1.34 billion. The company expects next quarter’s revenue to be around $1.38 billion, close to analysts’ estimates. Its non-GAAP profit of $0.88 per share was 8.9% below analysts’ consensus estimates.

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"Q2 was another strong quarter for Genpact, demonstrating our flywheel is accelerating, and our pivot to Agentic Operations is taking hold faster. Given the tremendous momentum we are seeing, we now expect Advanced Technology Solutions revenue to grow at least 25% for the full year," said Balkrishan "BK" Kalra, President and CEO, Genpact.

Company Overview

Originally spun off from General Electric in 2005 to provide business process services, Genpact (NYSE: G) is a global professional services firm that helps businesses transform their operations through digital technology, AI, and data analytics solutions.

Revenue Growth

A company’s long-term performance is an indicator of its overall quality. Even a bad business can shine for one or two quarters, but a top-tier one grows for years.

With $5.25 billion in revenue over the past 12 months, Genpact is one of the larger companies in the business services industry and benefits from a well-known brand that influences purchasing decisions.

As you can see below, Genpact grew its sales at a decent 6.6% compounded annual growth rate over the last five years. This shows its offerings generated slightly more demand than the average business services company, a helpful starting point for our analysis.

Long-term growth is the most important, but within business services, a half-decade historical view may miss new innovations or demand cycles. Genpact’s annualized revenue growth of 7% over the last two years aligns with its five-year trend, suggesting its demand was stable.

We can better understand the company’s sales dynamics by analyzing its constant currency revenue, which excludes currency movements that are outside their control and not indicative of demand. Over the last two years, its constant currency sales averaged 6.6% year-on-year growth. Because this number aligns with its reported revenue growth, we can see that foreign exchange has not had a meaningful impact on topline.

This quarter, Genpact reported year-on-year revenue growth of 7.1%, and its $1.34 billion of revenue exceeded Wall Street’s estimates by 0.8%. Company management is currently guiding for a 6.5% year-on-year increase in sales next quarter.

Looking further ahead, sell-side analysts expect revenue to grow 7.4% over the next 12 months, similar to its two-year rate. This projection is noteworthy and implies the market sees success for its products and services.

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Adjusted Operating Margin

Adjusted operating margin is a key measure of profitability. Think of it as net income (the bottom line) excluding the impact of non-recurring expenses, taxes, and interest on debt - metrics less connected to business fundamentals.

Genpact has been an efficient company over the last five years. It was one of the more profitable businesses in the business services sector, boasting an average adjusted operating margin of 16.9%.

Looking at the trend in its profitability, Genpact’s adjusted operating margin rose by 1.8 percentage points over the last five years, as its sales growth gave it operating leverage.

In Q2, Genpact generated an adjusted operating margin profit margin of 17.4%, in line with the same quarter last year. This indicates the company’s overall cost structure has been relatively stable.

Earnings Per Share

Revenue trends explain a company’s historical growth, but the long-term change in earnings per share (EPS) points to the profitability of that growth — for example, a company could inflate its sales through excessive spending on advertising and promotions.

Genpact’s EPS grew at 10.4% compounded annual growth rate over the last five years, higher than its 6.6% annualized revenue growth. This tells us the company became more profitable on a per-share basis as it expanded.

We can take a deeper look into Genpact’s earnings to better understand the drivers of its performance. As we mentioned earlier, Genpact’s adjusted operating margin was flat this quarter but expanded by 1.8 percentage points over the last five years. On top of that, its share count shrank by 11.4%. These are positive signs for shareholders because improving profitability and share buybacks turbocharge EPS growth relative to revenue growth.

Like with revenue, we analyze EPS over a shorter period to see if we are missing a change in the business.

For Genpact, its two-year annual EPS growth of 10.7% is similar to its five-year trend, implying stable earnings power.

In Q2, Genpact reported adjusted EPS of $0.88, in line with the same quarter last year. This print missed analysts’ estimates, but we care more about long-term adjusted EPS growth than short-term movements. Over the next 12 months, Wall Street expects Genpact’s full-year EPS to grow 12.2% from $3.80 to $4.26.

Key Takeaways from Genpact’s Q2 Results

It was good to see Genpact narrowly top analysts’ revenue expectations this quarter. On the other hand, its EPS missed and its revenue guidance for next quarter was in line with Wall Street’s estimates. Overall, this quarter could have been better. The stock traded down 3.2% to $35 immediately after reporting.

Genpact’s earnings report left more to be desired. Let’s look forward to see if this quarter has created an opportunity to buy the stock. What happened in the latest quarter matters, but not as much as longer-term business quality and valuation, when deciding whether to invest in this stock. We cover that in our actionable full research report which you can read here (it’s free).