Genpact Limited

Good day ladies and gentlemen and welcome to the 2023 fourth quarter GINPAC limited earnings conference call. My name is Michelle and I will be your conference moderator for today. At this time all participants are in a listen only mode. We will conduct a question and answer session towards the end of this conference. As a reminder this call is being recorded for replay purposes. The replay of the call will be archived and made available on the IR section of GenPAC's website. I would now like to turn the call over to Roger Sachs, Vice President of Investor Relations at GenPAC. Please proceed.

Thank you, Michelle, and good afternoon, everybody, and welcome to GenPAC's fourth quarter and full year 2023 earnings conference call. We hope you've had a chance to read our earnings press release posted on the IR section of our website, genpac.com. Today we have with us Tiger T. Adarajan, our outgoing president and CEO, BK Kalra, our incoming president and CEO, and Mike Wiener, our chief financial officer. Tiger will start with a high-level overview of our performance for the full year 2023. BK will then speak to our strategic priorities and outlook. And finally, Mike will cover our financial performance and outlook in greater detail before opening the floor to your questions. Please also note that during this call, you will make forward-looking statements, including statements about our business outlook, strategies, and long-term goals. These comments are based on our plans, predictions, and expectations as of today, which may change over time. Our actual results could differ materially due to a number of important risks and uncertainties, including the risk factors in our 10-K and our 10-Q filings with the SEC. And during this call, we will discuss certain non-GAAP financial measures. We have reconciled those to the most directly comparable GAAP financial measures in our earnings press release. These non-GAAP measures are not intended to be a substitute for our GAAP results. And finally, this call in its entirety is being webcast from our investor relations website. An audio replay and transcript will be available on our website in a few hours. And with that, let me turn the call over to Tiger.

I was on mute. Thank you, Roger. Good evening, everyone, and thank you for joining us today for our fourth quarter and full year 2023 earnings call. I will start with a brief overview of our 2023 financial results and then hand the call over to our incoming CEO, BK, to take you through our strategic priorities and outlook for 2024. For the full year 2023, we delivered total revenue of $4.48 billion, up 2% year over year, and 3% on a constant currency basis, driven by data tech AI services revenue of $1.99 billion, up 2% on both an as reported and constant currency basis, and digital operations services revenue of $2.48 billion, up 3% year over year as reported, or 4% on a constant currency basis. Gross margins of 35.1%, which was flat year-over-year. Income from operations margin of 14.1%, up 260 basis points year-over-year. An adjusted operating income margin of 17%, up 50 basis points year-over-year. and diluted earnings per share of $3.41, up 81% year-over-year, and adjusted diluted earnings per share of $2.98, up 9% year-over-year. Bookings for the full year reached $4.9 billion, up a strong 26% on a year-over-year basis, as we signed a record 14 new large deals, each with total contract value greater than $50 million. Inflows remained healthy, resulting in a high-quality pipeline that reached near record levels as we exited the year. Win rates increased to 60% versus 51% in the prior year, and we added 91 new logos. Sole source deals represented 40% of bookings below our typical 50% level, reflecting the much higher number of large deal wins, which tend to be more competitive. Throughout the year, we made progress on our key initiatives for 2023. First, revenue from priority accounts grew 4% year over year and expanded to 63% of total revenue. Second, we strengthened and expanded relationships with key cloud technology partners to co-innovate and develop joint IP solutions. Third, we opened and scaled three new operating centers in tier three cities in India. Fourth, we continue to drive non-FTE commercial models with non-FTE deals reaching 20% of total revenue in the fourth quarter and 17% of total revenue for the full year. Fifth, investments in our large deal team generated the strong bookings and pipeline that I described earlier. And finally, for the fourth consecutive year, our global workforce completed approximately 10 million trading hours on Genome, our on-demand learning platform. Finally, before I turn the call over to BK, I want to take a moment to reflect on Genpact's major accomplishments during these last 12 years. During that time, we grew total revenue at a compounded annual growth rate of 9%, driven by a number of important strategic pivots, including our decision to double down on a chosen set of industry verticals, services, and geographic markets, our decision to extend beyond business process management with significant investments in data, tech, and AI. And finally, our move over the last five years to the middle and front office with our emerging service lines in supply chain, risk, and sales and commercial services. All of our success would not be possible without the tireless efforts of the Genpak team. Their constant passion and focus on driving client outcomes and value and that insatiable curiosity and desire to learn has become our cultural foundation and has been a source of endless inspiration for me. It is my daily interaction with them that I'll miss the most as I transition to the next phase of my journey. With regard to BK, our board could not have picked a better person to be Genpak's next CEO. His deep understanding of our business, the trust and relationships he has built with our clients, and his strategic leadership with a strong bias for technology and AI has been a key driver of our success, driving the significant expansion of our consumer healthcare and financial services verticals that collectively generated $2.8 billion in revenue in 2023. I am very excited to see him lead this next evolution of GenFact. And finally, I want to sincerely thank our board for being such great stewards of the company through multiple cycles and on so many occasions being my and my lead team's guide and mentor. With that, let me turn the call over to PK.