$EXLS (-0.25%)

ExlService Holdings Inc (NASDAQ: EXLS ) presented its first quarter 2025 financial results on April 29, 2025, showing continued strong performance with year-over-year revenue growth of 14.8%. The company's strategic focus on data and AI services is bearing fruit: these offerings now account for more than half of revenue. EXLS shares rose by 1.17% in regular trading and gained a further 0.93% in pre-market trading after the presentation.

The company's positive development continues, marking the fifth consecutive quarter of accelerated growth. ExlService is successfully meeting the increasing demand for AI-based business solutions in its key industries.

Quarterly performance highlights

ExlService reported total revenue of $501 million for the first quarter of fiscal year 2025. This represents an increase of 14.8% compared to the same period last year and growth of 15.1% at constant currency. The company achieved an adjusted operating margin of 20.1%, an increase of 120 basis points compared to the prior-year period. Adjusted diluted earnings per share reached USD 0.48, an increase of 26.9% compared to the previous year.

The company's performance was driven by strong results across all segments, with particularly strong growth in Healthcare and Life Sciences, up 24.8% year-on-year. The insurance business remains the largest segment, accounting for 34.3% of total sales, while the banking, capital markets and diversified industries and international growth markets segments contributed 23.5% and 17.1% respectively.

EXLS added ten new clients during the quarter and increased its total headcount to 60,652, an increase of 1,100 employees since the fourth quarter of 2024. The company reported an employee turnover rate of 22.4% for the quarter.

Segment and service type analysis

ExlService has reorganized its reporting segments to better align them with its strategic focus areas. The new structure provides greater transparency on performance in key industries and geographic markets.

An important milestone for the company is that data and AI-based services now account for 53.5% of total revenue (USD 267.9 million), up 16% year-on-year. Digital Operations Services account for the remaining 46.5 % (USD 233.1 million) and recorded growth of 14.2 %. This development underlines the company's successful transformation into a data- and AI-focused company.

From a geographical perspective, North America remains the dominant market with 82.9% of sales, followed by the United Kingdom and Europe with 15.1% and the rest of the world with 2.0%.

To provide context for the new reporting segments, the company has included a comparison with the previous year's revenue in the new format:

Growth Trends and Forecast

ExlService has recorded steady sales and profit growth over the last five quarters.

The quarterly trend shows revenue growth from USD 436.5 million in the first quarter of 2024 to USD 501 million in the first quarter of 2025. Year-on-year growth rates increased from 8.8% to 15.1% on a constant currency basis. Adjusted diluted earnings per share also rose from USD 0.38 to USD 0.48 in the same period, with growth accelerating from 8.9% to 26.9%.

Based on this strong performance, ExlService has raised its revenue guidance for 2025 while maintaining its earnings outlook:

The company now expects revenue for the full year 2025 to be between USD 2,035 million and USD 2,065 million, which corresponds to growth of 11-13% at constant currency. This is an increase from the previous guidance of USD 2,025-2,060 million in February 2025. The guidance for adjusted diluted earnings per share remains unchanged at USD 1.83-1.89, which corresponds to growth of 11-14% compared to the previous year.

The company's focus on data and AI-based services is paying off: These higher-margin offerings now account for the majority of revenue. This is consistent with statements from previous conference calls in which CEO Rohit Kapoor emphasized that "data and AI are at the core of our business" and the "fusion of domain, data and AI expertise is our key competitive differentiator."

With strong first quarter results, increased revenue guidance and continued momentum in high-growth service areas, ExlService appears well positioned to maintain its growth trajectory through 2025. The company's strategic focus on data and AI capabilities, combined with its industry-specific expertise, provides a solid foundation for continued success in an increasingly digital and AI-driven business environment.

https://www.investing.com/news/company-news/exlservice-q1-2025-slides-revenue-up-15-data-and-ai-services-exceed-50-93CH-4013080

$EXLS (-0.25%) Reports Q1 2025

Sales: 501M vs 490M expected 🟢

EBIT: 78M vs 72M expected 🟢

Income: 66.5M vs 54.4M expected 🟢

Outlook for FY25:

Sales: 2.05B (prev. 2.04B) vs 2.05B expected 🟡

Diluted EPS: 1.85 (prev. 1.85) 🟡

10 new customers were acquired. Guidance was raised due to exchange rates. The company remains confident, but is not setting targets too high due to the macroeconomic situation (sounds like conservative guidance)

I have calculated the DCF of $EXLS (-0.25%) in a 5/10 year interval. In the case of the company, 10 years is most likely to be considered, and I built in a safety margin and came up with $55 per share!

$EXLS (-0.25%)

EXLerate.AI orchestrates data, digital and domain-specific AI solutions to transform mission-critical operations

NEW YORK, Feb. 25, 2025 (GLOBE NEWSWIRE) - EXL [NASDAQ: EXLS], a leading data and AI company, announced EXLerate.AI, its agent-based AI platform designed to help organizations reimagine workflows and seamlessly integrate third-party EXL and AI agents into their business operations. The new platform accelerates progress towards greater efficiency, improved customer experience, enhanced accuracy and increased scalability across business operations, resulting in better return on investment through AI.

EXLerate.AI is an open, cloud-agnostic and modular orchestration platform that enables rapid implementation in all customer environments. It includes more than 10 industry-specific AI agents developed by EXL that are already in use in insurance, healthcare, retail, utilities and financial services. Customers benefit from EXL's deep data and domain knowledge, data models and knowledge graphs and retain the flexibility to integrate third-party or in-house AI agents and current digital systems. Out-of-the-box capabilities improve the effectiveness of processes such as claims settlement, commercial underwriting, payment processing, customer service, internal audit, energy billing, accounts payable and legacy code migration.

The biggest challenge for companies when implementing AI is to integrate it seamlessly into workflows. By providing an orchestration solution with embedded high-quality AI agents, customers can now scale AI across the organization in a hybrid environment.

"Our teams have spent more than two years working with partners and customers to extend our AI solution platform to incorporate our proprietary LLMs, AI agents, knowledge graphs and data models to enable organizations to leverage AI and reimagine workflows without getting bogged down in technical complexities," said Anand "Andy" Logani, Chief Digital and AI Officer at EXL. "We invested in EXLerate.AI with three core principles in mind: a strong data and domain foundation, flexibility for rapid innovation, and the ability to seamlessly integrate AI into business workflows."

Unlike most AI solutions that perform a single task, EXLerate.AI orchestrates multiple AI models, along with human expertise and other AI-powered analytics. EXL will continue to innovate at a rapid pace and invest in the development of new AI solutions for key functions in insurance, healthcare, banking, capital markets and other industries.

Key features of EXLerate.AI include:

AI agents and accelerators: the platform supports more than 100 accelerators designed to improve automation and efficiency quickly and at scale. EXLerate.AI also includes a growing library of domain-specific AI agents that can dynamically interact with enterprise systems, optimize processes, improve decision making and enhance the customer experience.

Domain-specific Large Language Models (LLMs): EXLerate.AI includes two newly developed, proprietary LLMs for healthcare and finance. These specialized AI models are trained on domain-specific data and are based on the EXL Insurance LLM , which was launched in 2024 to support critical claims and underwriting tasks. With 25 years of expertise and proprietary, industry-labeled data, EXL's LLMs provide unmatched accuracy, efficiency and compliance, outperforming generic models.

Open architecture platform: Building on EXL's extensive data management and domain-specific knowledge, EXLerate.AI provides an open architecture platform that gives customers flexibility and does not lock them into a single platform. The platform is fully compatible with existing enterprise IT systems and is already integrated with technologies from industry leaders that are important to our customers, including NVIDIA, AWS, Google, Microsoft, ServiceNow and Salesforce.

https://www.globenewswire.com/news-release/2025/02/25/3032167/9060/en/EXL-launches-EXLerate-AI-platform-to-drive-accelerated-AI-business-benefits-at-scale-for-enterprises.html

Still see a lot of potential here after analyzing @Tenbagger2024
$EXLS (-0.25%)

After presentation by @Tenbagger2024 today, the share of $EXLS (-0.25%)

P/E ratio of 32 with >10% sales growth and rising margins. That sounds really good and for an AI profiteer with a market capitalization of less than 10 billion, there is still a lot of potential. I hope my colleague Tenbagger will continue to provide us with news and quarterly figures here on the platform :-)

Otherwise, I am buying this year at $NOVO B (+0.8%) and $MSFT (-0.01%) and have already bought several times. I have also increased my position in $TTD (+4.11%) in order to reach the target position size more quickly at the current realistic prices.

$EXLS (-0.25%)

While many investors have been pondering since the launch of DeepSeek whether the AI hype was exaggerated and considering how the big players want to make money with AI, ExlService provides the answers - and very well!

ExlService benefits greatly from AI and data analysis.

Quarterly figures exceed expectations, profit increases.

Market forecasts for Exl show further growth potential.

With a market capitalization of just over eight billion US dollars, ExlService is certainly not one of the largest AI companies on the stock market. However, the Americans are a good example of how good money can be made with artificial intelligence. The tills are getting fuller and fuller and the customer base more and more select. This is the beginning of a success story!

The business model

ExlService Holdings, Inc, better known as Exl, is a global company specializing in data analytics, artificial intelligence (AI) and digital solutions. Since its founding in 1999, EXL has expanded its services from business process outsourcing (BPO) to comprehensive data and AI-driven solutions.

The services and solutions

EXL offers a wide range of services including:

Data analytics and AI: helping companies use data and AI to improve customer experience, profitability and growth.

Digital transformation: helping to modernize business processes through digital technologies.

Digital operations management: Optimizing business processes through data-driven, AI-supported solutions.

The industry expertise

EXL serves various industries, including:

Banking and capital markets

Healthcare and life sciences

Insurance

Retail and consumer goods

Energy and infrastructure

Communication and media

The customer base

Not much needs to be said here. A picture is worth a thousand words.

The current figures

ExlService published its quarterly figures for the third quarter at the end of October. Adjusted earnings per diluted share rose to USD 0.44 (approx. EUR 0.41), compared to USD 0.37 (approx. EUR 0.34) in the previous year. Analysts at Capital IQ had expected USD 0.41 (approx. EUR 0.38).

Revenue for the quarter ended September 30 amounted to USD 472.1 million (approx. EUR 440.5 million), up on the previous year's USD 411 million (approx. EUR 383.5 million). Experts had expected 460.8 million US dollars (approx. 430.3 million euros).

The forecast increase

For the full year 2024, the company is now forecasting adjusted earnings per share of between 1.61 and 1.63 US dollars (approx. 1.50 to 1.52 euros) and revenue of 1.825 to 1.835 billion US dollars (approx. 1.70 to 1.71 billion euros). Previously, EXLS had expected a range of 1.59 to 1.62 US dollars (approx. 1.48 to 1.51 euros) with turnover of 1.81 to 1.83 billion US dollars (approx. 1.69 to 1.70 billion euros).

Analysts at Capital IQ are forecasting adjusted earnings per share of USD 1.62 (approx. EUR 1.51) and revenue of USD 1.82 billion (approx. EUR 1.70 billion) for 2024.

On February 25, Exl reports the figures for the 4th quarter. The trend is that another positive surprise is possible.

My tip: The launch of DeepSeek has given investors pause for thought. As a Chinese company with its prescribed censorships, the AI model is unlikely to represent direct competition for Western providers, but its launch will nevertheless have an impact on the market.

The expensive infrastructure and high investments in AI models are now being questioned. This could mean that the long-term forecasts for the demand for high-performance hardware and large data centers may have been too optimistic. This poses a challenge for companies in the AI sector, some of which have very high valuations.

However, there are always two sides to a coin. More efficient AI models could facilitate access for companies and accelerate the spread of AI technology. Even if the hardware requirements per model decrease, the increasing use of AI as a whole could actually increase the need for GPUs and infrastructure.

The price rally of most AI stocks is likely to have come to an end for the time being at a still high level. Investors are reorganizing. The wheat is now beginning to be separated from the chaff. Investors are not currently buying into everything that has AI written on it. Now the companies must continue to deliver. Those who fail to do so will fall by the wayside.

And that brings us back to Exl. The Group is earning very well and its order books are full to bursting at around 2 billion US dollars. Experts believe that the market Exl is targeting will triple in size in the coming years. While many AI high-flyers have weakened recently, Exl's share price has continued to rise almost unperturbed.

This may also be due to the fact that Exl is not very well known among investors and experts due to its current size. According to MarketScreener, only 9 experts are currently taking a closer look at the stock. Of these, however, seven recommend "buy" and two "hold". With a P/E ratio of 36, Exl is also not as highly valued as some other stocks in the AI sector.

The chart also looks good. If the share takes a breather to around USD 50, the next strong upward surge could start from this level. The figures for the fourth quarter, which are due in less than two weeks, could be the fuel for this.

https://www.wallstreet-online.de/nachricht/18992642-klein-fein-exlservice-fuellt-ki-ordentlich-kasse-erfolgsstory