ExlService Holdings, Inc.

Ladies and gentlemen, thank you for standing by, and welcome to the second quarter 2022 EXL Service Holdings, Inc. Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1-1 on your telephone. It is now my pleasure to introduce Vice President of Investor Relations, Stephen Barlow.

Thank you, Andrew. Good morning, everyone. Thanks for joining our second quarter conference call. I'm Steve Barlow, EXL's Vice President of Investor Relations. On the call today are Rohit Kapoor, our Vice Chairman and Chief Executive Officer, and Maurizio Nicolelli, our Chief Financial Officer. We hope you've had an opportunity to review our Q2 2022 earnings release we issued this morning. We've also updated our investor fact sheet in the Investor Relations section of EXL's website. As you know, some of the matters we'll discuss in this call are forward-looking. Please keep in mind that these forward-looking statements are subject to known and unknown risks and uncertainty that could cause actual results to differ materially from those expressed or implied by such statements. Such risks and uncertainties include, but are not limited to, general economic conditions. Those facts are set forth in today's press release, discussed in the company's periodic reports and other documents filed with the Securities and Exchange Commission from time to time. EXL assumes no obligation to update the information presented on this conference call. During our call today, we may reference certain non-GAAP financial measures, which we believe provide useful information for investors. Reconciliation of these measures to GAAP can be found in our press release, as well as on the investor fact sheet. I'll now turn the call over to Rohit Kapoor, EXL's Chief Executive Officer. Rohit.

Thank you, Steve. Good morning, everyone. Welcome to our Q2 2022 earnings call. I hope all of you are doing well. I'm pleased to report another great quarter following our strong performance in Q1. Our second quarter revenue was $346.8 million, up 5.3% from Q1 and up 26.1% year over year. For the quarter, adjusted EPS was $1.50 per share up 31.6% year over year. Our growth was driven by our analytics business, which generated $161.3 million in revenue for the quarter, up 8.2% sequentially and 44.8% year over year. Analytics now accounts for 47% of our total revenue. Our digital operations and solutions business saw strong growth this quarter, with revenue of $185.5 million, up 2.9% quarter over quarter, and 13.3% year over year. This was led by double-digit revenue growth from our emerging business segment, which generated year over year growth of 32.4%. Our data-led approach is unique and is resonating well in the marketplace. Our clients need to respond much faster with the most relevant service offerings to their end customers in this new world of increased volatility and higher expectations from the consumer. Our data-led approach allows for precision-based targeted responses, better business decisions and improves operational processes in a systemic way. This has led to an accelerated growth of our overall business and we are very pleased with the business results so far. I want to spend a few minutes today talking about the current macroeconomic environment and how we see it impacting our business. A combination of high inflation, talent scarcity, and global supply constraints has created significant uncertainty and volatility in the economic environment. With continued geopolitical risks, rising interest rates, and a low growth environment, these threats are likely to be persistent and acerbate. However, In the current environment, it becomes more important than ever for businesses to invest in technology, automation, and data-led transformation to stay relevant for their customers. We expect that the demand for our services will likely remain strong while the composition of these services might undergo a change. Cost management is likely to become more important along with managing delinquencies and prevention of fraud, which tends to rise in slow growth environments. EXL is very well positioned to help our clients navigate this turbulence and be a value-added strategic partner. Our data analytics and digital solutions help our clients drive workflow efficiencies, create hyper-personalized customer engagement, and mitigate their risk. Our capabilities are mission critical for our clients and are a fundamental lever for them to address their most significant challenges. And finally, our geographic mix of business is well situated to deal with the global uncertainty and volatility. As we continue to create new data-led business solutions for our clients, we are proud to announce our recent joint venture with Oliver Wyman and Corridor Platforms. This new solution delivers a turnkey risk decisioning system in real time for regional banks and credit unions. It is based on enterprise risk analytics, governance, and automation solutions that EXL, Corridor, and Oliver Wyman are currently delivering for some of the world's largest banks. This new solution brings all of those capabilities together as a hosted solution on the cloud. We call it risk decisioning as a service, and it is being offered on a usage-based pricing model which aligns cost with demand on the platform. This variable cost structure is intended to make our proven institutional-grade risk and governance solutions accessible to smaller financial institutions. As more retail bank customers turn to digital lending alternatives, such as point-of-sale financing and digital loans, this solution will play a key role in helping smaller financial institutions keep pace with changing trends in customer demand. In a similar vein, in order to further enhance our capabilities around being a data-led business, we have been investing in upstream data management capabilities. We are working on a number of high profile global data transformation projects to help clients redesign their data management capabilities and drive their shift to the cloud. Our 2021 acquisition of Clairvoyant is helping drive our scale and success with these initiatives in one example with a uk general insurer exl leveraged its enterprise data management analytics machine learning and ai capabilities to enhance their growth trajectory through a data and analytics led transformation roadmap we help the client orchestrate a cloud optimized analytics-ready enterprise data platform that unlocks significant business benefits across the insurance value chain. We enabled data science as a service capability for delivery of advanced analytics use cases like image analytics-based underwriting, ML-based fraud detection, and quote, manipulation detection. With these types of data-led transformation projects, of course, comes a huge demand for highly skilled talent. To address the challenges of the current talent scarce market, we've redoubled our efforts over the past several quarters to position EXL as a destination for top talent. Our ability to provide work that matches the aspirations of highly capable people our culture of constant improvement, our relentless investment in learning, and our consistent growth are factors that help us attract the best people. We crossed a milestone of 40,000 total employees in June with close to 50% growth in analytics talent from the first half of 2021 to the first half of 2022. Also, More than 70% of our current hiring is for complex skills which are aligned with our data-led and digital solutions delivery for our clients. In fact, this quarter, in a market with high demand for talent, our employee engagement increased to the highest level we've ever recorded. Our world-class talent, resilient business model, and robust pipeline make me confident in EXL's ongoing growth prospects. We will continue to closely monitor our client base and the broader macroeconomic environment for signs of headwinds. However, we remain confident that the strong demand for our services combined with the critical role we play for our clients' businesses, will position us well. I will now invite Maurizio to highlight our Q2 financial performance and revised 2022 guidance.