Globant S.A.

Good day and welcome to Globant's 4th Quarter and Full Year 2024 Earnings Conference Call. I am Arturo Langa, Investor Relations Officer at Globant. All participants on this call will be on listen-only mode. After today's presentation, there will be an opportunity to ask questions. Kindly refrain from raising hands, as we'll aim to address a select number of questions to ensure efficiency. Please note this event is being recorded and streamed live on YouTube. By now, you should have received a copy of the earnings release. If you have not, a copy is available on our website, investors.globant.com. Our speakers today are Martin Migoya, Co-Founder and Chief Executive Officer, Juan Urteague, Chief Financial Officer, Patricia Pomies, Chief Operating Officer, and Diego Tartara, Global Chief Technology Officer. Before we begin, I would like to remind you that some of our 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. Such statements are subject to the risk and uncertainties as described in the company's earnings release and other filings with the SEC. Please note that we follow IFRS accounting rules in our financial statements. During our call today, we will report non-IFRS or adjusted measures, which is how we track performance internally and the easiest way to compare Globan to our peers in the industry. You will find a reconciliation of IFRS and non-IFRS measures at the end of the press release we publish on our Festival Relations website, announcing this quarter's results. I'd like to turn the call over to Martín Migoya, our CEO.

Welcome, good afternoon and hello everyone. We're facing a major transformation. It is a revolution that Globan has not only anticipated, but has been shaping for many years. With advance in AI, the lines between technology and business are fading. Today, it's not just a tool, but the core of enterprise reinvention. While many technology players are jumping on the AI revolution, branding themselves as experts without having made any real investments in the field, Globan has been investing in AI for the past 10 years. This long-term commitment means we are not merely riding the wave of the latest trends. We have developed deep proven expertise in the field. Creating technology that dares to delight is not just about writing code. It is about creating meaningful value in a world powered by AI agents, industry-specific intelligence, and human touch. We were building software with purpose, shaping experiences, driving impact, and pushing the boundaries of what technology can achieve. Many doubted, but this was not our guide. Vision was. Along the journey, we have worked on projects that redefine the user experience, from game face ID technology at the new LA Clippers into Dome, to the digital ecosystem of Qidiyah in Saudi Arabia, to the next generation passenger experience at one of the top airlines in the UK. Our momentum is undeniable. We are no longer just scaling. We are orchestrating an ecosystem of AI agents that automate complex processes, not only in operations, but across digital, front-end, back-end, digital branding, creativity, and enterprise functions. At the heart of this transformation are our AI studios. These studios are not just another business unit. They are the epicenter of our reinvention strategy. They are designed to embed AI deeply within industries, leveraging company-specific data, insights from ERPs, CRMs, and other transactional systems, and generating synthetic data to train models to learn, adapt, and evolve. They represent the boldest expression of what we believe the future holds, a future where AI doesn't just support business, it drives them. Powering this entire ecosystem is our global Enterprise AI platform, the orchestration software that seamlessly integrates and manages all these AI agents. Enterprise AI provides LLM model independence and stability. ensuring that our clients are not locked into a single technology provider. More importantly, it delivers complete traceability of AI-driven processes, offering transparency, accountability, and the ability to monitor and pivot strategies in real time. Enterprise AI is the backbone that supports our AI studios, enabling us to offer robust, adaptable, and scalable AI solutions to enterprise around the world. The platform is being implemented to accelerate the software development lifecycle in most of our current projects. We have seen an outstanding growth of AI-related projects at Globant. In 2024, they contributed over $350 million to our revenue, up 110% from 2023. But technology alone isn't enough. Combining branding with technology creates products that are not just functional, but emotionally resonant and culturally relevant. In a world where widespread access to technology leads to commoditized look-alike products, we advocate for merging creative storytelling with tech development to build products that stand out. At Globan, we believe that brand is tech's prompt. A strong brand should be the foundation for technology, ensuring it reflects the company's core values and creates meaningful connections. This approach ensures that technology doesn't just solve problems, it tells stories, evokes emotions, and builds lasting loyalty. This has been the mission driving the growth of Globangat, our creative marketing network of studios. smart marketing campaigns with brands ranging from Coca-Cola to Mercado Libre to Verizon. Today, our global GATT network represents close to 10% of our total revenue and is showing a strong and sustained growth year over year. All these efforts are combined with global entrepreneurial culture. We want to inspire every Glover to feel like they own the place. I'm sure that this is what was behind our performance in 2024. While our peers reported stagnant growth, we broke new records. Annual revenue reached $2.4 billion, up 15.3% over previous year. Margin also improved. Adjusted operating profit was up by 20 basic points, and adjusted diluted EPS grew 11.5% year over year to $6.40. As we close 2024 and looking back at our first 10 years as a listed company, Globan delivered a 28.3% compound annual growth rate from 2014. In Q4, total revenue reached $642.5 million. This represents an increase of 10.6% year over year and 4.5% quarter over quarter. This growth is not just a testament to our resilience, but a reflection of a vision and transformation that goes beyond our competitors. It is the embodiment of our strategy, our relentless pursuit of reinvention, and our ability to see opportunities where others see obstacles. Even if we build this AI-powered future, we know that AI requires continuous leadership, technical talent, and a mindset that embraces reinvention as a constant state, not an occasional need. Our people define the goals, guide the agents, and pivot strategies in an environment of constant change. For over two decades, we have challenged the status quo, often seen as outliers in an industry obsessed with the next quick win. We were not building for the next quarter. We were building for the next paradigm. Today, we are creating a company that is both an established force and an agile changemaker. We have proven that we are capable of reshaping industries and redefining business models. We are not here to follow the curve. We're here to bend it. Now, I'll hand it over to Diego for our technology focus.

Thank you very much. Thank you, Martine, and hello, everyone. As Martin mentioned, coupling generative AI with agentic solutions will benefit Globant both as a solutions developer and as a business consultancy. In November, CodeFixer, the AI agent developed through Globant Enterprise AI to fix bugs and already in use by Globers globally, ranked first in the renowned SWE BenchLight evaluation, confirming its exceptional performance. AI agents are being leveraged big time by our industry-specific studios to enhance our value offering and are integral to our partnerships. Over the past six months, Globant has successfully implemented Salesforce AgentForce across multiple industries, driving AI-powered automation and efficiency. For example, we partnered with Spain's top flight sports organization to enhance fan engagement, with a real estate developer to optimize transportation bookings, and with an employee benefits management company to improve real-time order tracking. With Google, days ago we presented a new GenAI solution for retail. AI Retail Search and Recommendations allows customers to interact with their beloved brands using semantic searches and images as references for what they are looking for. Using Vertex Retail API and Gemini, AI Retail Search and Recommendations is designed to enhance personalization, drive conversions, and improve customer services. Also with Google, we recently signed a three-year strategic partner agreement that has positioned us among top 10 Google regional system integration partners. Through this collaboration, we are co-developing solutions and go-to-market strategies for key industries, including media, retail, HLS, airlines, and finance. Now let me share some of the work we are doing for amazing companies around the world. In Mexico, Globe and Gut began a strategic partnership with Diageo aimed at revolutionizing its e-commerce business. We are integrating technology, data analytics, and creative content to enhance the online shopping experience and boost brand visibility. The 360 scope includes a dedicated data team to ensure campaign relevance, a content team to optimize product visibility on digital platforms, and a retail media strategy aimed at maximizing advertising ROI. This partnership is not just about maintaining leadership, but about innovating the retail experience through technology and creativity. In our vibrant New Markets division, Globant has partnered with Red Sea Global, one of Saudi Arabia's most ambitious tourism destinations that will be home to 50 resorts, 8,000 hotel rooms, and 1,000 residential properties by 2030. we will create an advanced digital program designed to transform the connected visitor experience. It will be based on an ecosystem that integrates artificial intelligence, IoT, and data analytics. This connected visitor experience will provide intuitive, real-time interactions tailored to individual preferences, ensuring a truly memorable stay. This partnership will pioneer new benchmarks in digital engagement, revolutionizing how travelers interact with destinations. In the health and life sciences sector, we are proud of our growing and transformative partnership with Hollister, a global medtech company. Globant enabled a successful go-live for Hollister's Canada business and looks forward to a continued partnership to implement a global business transformation, including a migration to SAP S4 HANA. Ultimately, this means faster database interaction, real-time insight into business operations, and advanced process automation and efficiency. In Japan, we are working with Rizona Bank Group, one of the country's largest retail banks with 16 million individual customers. They chose GeneXus to support the migration of most of the business operations currently performed through ATMs and financial terminals at brick-and-mortar branches to computers and other electronic devices offering a better and easier experience to their customers. Rizona Bank Group was able to reduce half of its financial terminals through a lean and quick project. As shown by our work around the globe, Globant is leveraging all significant technologies while exploring new ones on the horizon. I suggest you take a look at Globant's latest Tech Trends report to learn about synthetic humans, quantum computing, invisible experiences, and robotics and more on our vision over AI-agentic solutions. Adding to what Martin mentioned, Globant is in a unique position to craft a new reinvention of the industry with amazingly talented people, an evolving technological offering, and an agile and disruptive culture. I leave you all with Patricia Pommies, our COO. Thank you very much.