Epam Systems stock drops after profit, revenue outlook cut due to clients have become more cautious
Shares of Epam Systems Inc. (EPAM) sank 5.4% in premarket trading Monday, after the engineering software company cut its profit and revenue outlook, citing "further deterioration" in near-term demand. For the second quarter, the company now expects adjusted earnings per share, which excludes nonrecurring items, of $2.33 to $2.40 and revenue of $1.16 billion to $1.17 billion, which are below the FactSet consensus for EPS of $2.43 and for revenue of $1.21 billion. For the full-year, the company cut its guidance ranges for adjusted EPS to $9.80 to $10.20 from $10.60 to $10.80 and for revenue to $4.65 billion to $4.80 billion from $4.95 billion to $5.00 billion. "In the weeks since our Q1 earnings call, we have seen our clients become even more cautious with spending specifically in the 'build' segment of the global IT services market," said Chief Executive Officer Arkadiy Dobkin. "After careful assessment of changes in our May and June forecast data, we have come to understand that pipeline conversions are occurring at slower rates than previously assumed and we are also seeing some reduction in the total pipeline." The stock has tumbled 15.1% over the past three months through Friday while the S&P 500 has gained 5.9%.
-Tomi Kilgore
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06-05-23 0612ET
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