Globant S.A.

Good afternoon and welcome to Globant's second quarter 2025 earnings conference call. I am Arturo Langa, Investor Relations Officer at Globant. All participants on this call will be in listen-only mode. After today's presentation, there will be an opportunity to ask questions. 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.globent.com. We will begin with remarks by our Chief Executive Officer, Martin Migosha, our Chief Financial Officer, Juan Ortiaga, and our Chief Technology Officer, Diego Tartara. This will be followed by a Q&A section. Before we begin, I would like to remind you that some of 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. Such statements are subject to the risks 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 Globant 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 published on our Investor Relations website, announcing this quarter's results. I will now turn the call over to Martin Migosha.

Good afternoon, everyone, and thank you for joining us once again for Globan's quarterly earnings. It's always a pleasure to connect and share how we are continuing to evolve and improve. For us, innovation and reinvention are not occasional events. They are part of our DNA. And right now, we're building on that tradition with a clear and steady focus on the future. In the second quarter, we delivered revenue of $614.2 million, representing 4.5% year-over-year growth. Our pipeline is at all time high, 3.7 billion, up 25% from last year. Although the macro environment has extended sales cycles, our teams are laser focused on converting this pipeline into signed work in the coming quarters with large potential deals in healthcare, financial services, CBG, and gaming, among others. These large engagements, many already in advanced stages, position us well for conversion in the coming months, reinforcing our focus on high-value clients with strategic impact. Internally, we're fine-tuning the organization to be not only more efficient and profitable, but also more nimble and better aligned with the needs of the next generation of business models. Our aim is to ensure Globant is structurally agile and positioned to compete and win in an evolving landscape while continuing to deliver strong results for our shareholders. Juan will walk you through the details shortly. Globant's AI pods, which I introduced last quarter, are the virtual teams for the digital workforce. They are powered by agentic AI and orchestrated by our experts. The way companies access our AI pods is unique in the industry through our monthly subscription model. It is a consumption-based, outcome-aligned pricing that provides guaranteed time and cost savings shifting the value proposition to concrete results. After just one quarter, we already have 18 clients who have chosen this new model and our subscription model accounts for a significant portion of our recent pipeline growth. We look forward to expanding this in the future. The AI world is moving at incredible speed, and there are two major races going on. The first is over who builds the best foundational models or agents, and that race is OpenAI, Anthropic, Meta, XAI, and other. Every week, new models, frameworks, and tools emerge. But this is not our race. The second is about who applies AI better, faster, and with greater return on investment on specific business cases for every company in every industry. For companies, the expansion of all these new foundational models presents an immense opportunity, but also a challenge of determining the right combination of models, tools, and and approaches for their specific needs while managing data privacy and compliance. It is more like entering in a dense and constantly changing forest where familiar paths disappear and new ones open overnight. In that environment, you need not just a map, but an experienced guide who knows how to adapt the route as the terrain shifts. At Globan, we take on that role, helping our clients find the safest and most effective path forward. We remain 100% client-centric while leveraging our deep partnerships with all major AI leaders to ensure our clients get the best of each ecosystem. This means we can select or combine the most advanced models and capabilities available in the market, integrating them in ways that are tailored to each unique task and business context. Global Enterprise AI is the toolkit we bring into that complex forest. It is a golden path for our customers' generative AI adoption and impact. Offering seamless access to all major LLMs, it provides traceability, auditability, and granular access and cost control. It includes a library of hundreds of industry-tailored plug and play business processes, and state-of-the-art retrieval augmented generation pipeline optimized for proprietary corporate data, delivering faster, more relevant, and contextual precise insights. Enterprise AI integrates with major enterprise platforms, Manages AI-driven workflows across departments, connects human teams with intelligent agents, and is fully compatible with A2A protocols and MCP servers. The platform uses a token-based execution model to align AI usage to measurable business value. We launched the 2.0 version of Global Enterprise AI. Diego will go into more detail on this shortly. When you combine that with the industry-specific expertise of our AI studios, you get a fully integrated engine for transformation across the entire AI value chain. We go beyond offering AI services. We architect and connect every layer of the AI stack, then deliver it as scalable subscription-first solution. Our AI studios continue to drive deeper engagement with major global clients, unlocking cross-selling opportunities and deploying specialized talent from across our global network and restricted by regional boundaries. Part of growing is partnering with the best. A couple of weeks ago, we announced a multi-year collaboration with OpenAI as one of their few global services partners. By combining their world-class models with our engineering capabilities, we're delivering secure, responsible, and scalable AI adoption worldwide. We're already integrating GPT-5 across all layers of our enterprise AI platform and embedding it into our AI pods processes. Along a similar line, days ago, we took a big step forward by becoming one of the few global partners to sign a strategic collaboration agreement with Amazon Web Services. Diego Tartara will expand on this later. We have teamed up with La Liga, Spain's premier football league, on a multi-year transformation program through Sportian, our sport-tech joint venture. This is not just a technology project, it is a game changer. By embedding our AI pods at the heart of their operations, we will unlock the full power of AI agents in sports to boost team performance, deepen fan engagement, and drive operational excellence across the league. It is a clear example of how global enterprise AI is helping world-class organizations to embrace AI at scale and win in the most complex high-profile arenas. We have strengthened our position in the robotics and AI ecosystem by investing in InOrbit, a leading robotics integration company. This expands our capabilities, enabling advanced orchestration of different fleets of robots and autonomous systems across industries. It ensures we can integrate physical automation into enterprise workflows at scale, connecting AI agents not only to digital process but also to real-world robotic operations. Today, our revenue mix is more diverse than ever. North America remains our largest market with 54.1% of our revenue. Latin America accounts for 19.7% and is showing strong recovery with new records in bookings. Europe represents 19.6% and is our fastest growing region sequentially, up 8.1% with major wins in aviation and financial services. New markets grew an impressive 84% year over year and is currently 6.6% of our total revenue. The Middle East leads this surge. driven by our work on several Giga projects. Our 100-square program continues to gain momentum with our client base growing and diversifying. And Diego will share more on recent client wins and large-scale engagements that illustrate this strong momentum. 49 clients now generate more than 10 million in annual revenue, up from 39 a year ago. 339 clients generate over 1 million annually, up from 329 last year. Over the past 21 years, we have earned a unique position in our industry. by fusing advanced technology, human creativity, and a deep understanding of our clients' needs. In 2025, the complexity of the environment is matched only by the scale of the opportunity, as AI redefines business models, value chains, and competitive advantage. Our mandate is to help clients navigate this change with precision and foresight, capturing value across every layer of the AI stack. With AI pods, our subscription model, AI studios, and the 100 square approach, we're delivering Globanz as a full-stack AI company, one that designs, builds, and integrates technology platforms and industry-specific expertise into scalable solutions. This integrated model ensures we remain not just relevant but indispensable as enterprises embrace the AI-powered future. We're as energized by the challenges ahead as we are by the opportunity. And with this team, I have no doubt we will capture them all. Thank you very much.

Hello, everyone. I'm happy to be back. I want to expand on the offering of Globant's Enterprise AI 2.0 version that now includes MCP and Asian to Asian and the marketplace of Asians for its users, among other new features. It enables a full AI adoption addressing three core needs of our clients. First, governance. Organizations need to be in control of their own AI journey, with strong security, risk management, traceability, and guardrails for both models and conversations. Global Enterprise AI provides leaders with the control they need to map their exposure to both cost and risk. Second, build capability. Companies need the tools to create and deploy solutions connected to the enterprise systems. Global Enterprise AI Platform is home to the lab for agent creation, orchestration, and ensuring interoperability. As of this quarter, the lab now supports the model context protocol and the agent to agent protocol. These enhancements allow seamless integration of agents and tools from across the AI ecosystem like Google Cloud, Azure AI Foundry, and Amazon Bedrock. And third, impact. The ability to explore, combine, and share solutions and to operate them so they can generate measurable business outcomes. This is where AI moves from pilot to scale adoption, ensuring that investments translate into tangible value across the organization. In this layer, we have recently launched a specific module for our clients called the Station. It offers a curated searchable library of in-house built AI agents tailored to diverse business and industry needs, streamlining discovery while removing friction. With just a few clicks, users can now deploy agents via intuitive orchestration tools, speeding time to experimentation and value. Organizations using Global Enterprise AI have reported an 80% reduction in legacy systems modernization times and a 50% increase in software development costs. Global Enterprise AI also powers a lineup of hundreds of industry specifications, along with three flagship patients tailored to each of our core studios. Globe and Coda is our agentic suite for our digital studios, a key component of how we reimagine software development life cycles and how we deliver value. Navigate is for our enterprise studio. It optimizes business operations and performance. Infusion from GAD Studio launched at Cannes Lyons this year. It enhances full funnel marketing, communications and advertising. It streamlines processes from content creation to campaign optimization. Now let's discuss our work with some fascinating clients as we partner with them on their re-invention journey. In gaming, we're working with one of the leaders in producing real-time 3D content to deliver interactive solutions to high-growth sectors, including digital twins, automotive, healthcare, life sciences, and manufacturing. By employing our global delivery network, we will be helping this company to expand to new commercial markets, unlocking new business for them. On the technology side, we will be integrating their products into enterprise technology stacks, supporting new go-to-market strategies and co-developing tailored solutions. Our sustainable business studio is proud to be collaborating with the Worldwide Fund for Nature. Together, we are developing tools that link tree civility with carbon footprint assessments. This initiative engaged multiple stakeholders, including national agribusiness entities, industry leaders, and civil society, facilitating the transition towards more sustainable meat production practices. The complexity and the time-sensitive nature of the challenges the WWF faced led them to enlist our low-code GeneXus platform. This collaborative effort will accelerate the adoption of sustainable practices support regulatory compliance, and empower producers globally. We're excited to announce a partnership with a world leader in premium spirits to develop a generative AI-powered commercial insight station. This innovative tool will provide our clients' employees with immediate access to critical data insights, streamlining decision-making in product development, marketing, sales, and strategy. By automating data retrieval, we are helping them to reduce the time and costs of traditional business intelligence workflows. allowing the teams to focus on strategic initiatives. The Asian will enhance efficiency through self-service decision support and tailored recommendations. This initiative is just the beginning, as the Commercial Insights Asians will lay the groundwork for future applications in brand planning, commercial forecasting and innovation. we are redefining the potential of AI-powered enterprises and unlocking new growth opportunities. Regarding our partnerships, days ago we advanced our relationship with AWS by establishing a strategic collaboration agreement to accelerate AI adoption and enable Globan to provide clients in specific industries with enhanced support for cloud migration, generative AI adoption, industry-specific solutions, while helping them to optimize their cloud usage and manage expenses efficiently. We're collaborating with Salesforce to deploy AsianForce and Data Cloud across multiple industries, automating their teams and enhancing their ability to support their customers, tailor marketing journeys, and better segment their clients. as Globant's creative industry pillar, got advanced on large-scale projects for top brands, including Progressive, Procter & Gamble, DoorDash, and more, as well as new projects for Havaianas, Rimowa, among others. Thank you, everyone, for joining us again.