EPAM Systems, Inc. (NYSE:EPAM) Q2 2018 Earnings Conference Call - Final Transcript

Aug 02, 2018 • 08:00 am ET


EPAM Systems, Inc. (NYSE:EPAM) Q2 2018 Earnings Conference Call - Final Transcript


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Greetings, and welcome to EPAM Systems Second Quarter 2018 Earnings Call. (Operator Instructions) As a reminder, this conference is being recorded.

I would now like to turn the conference over to your host, David Straube, Head of IR.

David Straube

Thank you, operator, and good morning, everyone. By now, you should have received your copy of the earnings release for the company's second quarter 2018 results. If you have not, a copy is available at epam.com in the Investors section. With me today are Arkadiy Dobkin, CEO and President; and Jason Peterson, CFO.

(Forward-Looking Cautionary Statements)

Additionally, all references to reported results that are non-GAAP measures have been reconciled to GAAP and are available in our Q2 earnings materials located in the Investor section of our website.

With that said, I will now turn the call over to Ark.

Arkadiy Dobkin

Thank you, David, and good morning, everyone. Thanks for joining us. Let me begin with a few financial highlights. We delivered a strong second quarter with revenues of $445.6 million, reflecting 27.7% year-over-year growth or 27.1% in constant currency terms. Our revenue growth was broad based, both geographically and across all of our industry verticals. In addition, we delivered a strong non-GAAP earnings per share of $1.01, which represents 26% growth from Q2 of 2017.

Let me provide you with a brief update across the key dimensions of our business. Looking at our capabilities and offerings. Last quarter, we talked about enriching our offerings across digital transformation programs and connected digital platforms, which continues to be our key areas of focus with accelerated development of capabilities in intelligent automation, RPA, machine learning and IoT.

Additionally, we also talked about expanding our horizons with new offerings around physical product innovation with close connectivity into software controlled ecosystems as well as strengthening our design thinking and business consultancy skills. Finally, we talked about our aspiration to integrate, at different levels, EPAM consulting capabilities across business, experience and technology disciplines into our mainstream delivery offerings, and as a result, to significantly elevate the overall value of the solutions we build for our clients.

In Q2, we continued to focus on those areas and are starting to see some results triggered by our new cross functional initiatives in a number of potentially large engagements, as well as in numerous wins of new types of deals because of broader adoption of such an approach. A couple relevant highlights to illustrate. While we were involved for sometime in many proof-of-concept type efforts based on RPA technologies, some of those projects have evolved into much more complex and sizable intelligent automation engagements across several industries.

As in the case of any organization, understanding the potential benefits of intelligent automation, realities of implementation in specific corporate environments, maturity and actual functionality of emerging platforms and setting achievable goals within a given time frame is critical and can mean the key difference between reaching the desired outcome or complete failure. This is where we started to bring new value by offering a very