Genpact Q2 2026 Earnings: Advanced Technology Solutions Drives Growth

Genpact (NYSE: G) reported Q2 2026 net revenue of $1.343 billion, up 7.1% year over year, while diluted EPS increased 14.7% to $0.86 from $0.75. Advanced Technology Solutions supplied most of the revenue growth and margins improved modestly, but quarterly operating cash flow fell sharply from the prior-year period.

Core financial results

Gross profit grew faster than revenue, lifting gross margin to 36.5%. GAAP and adjusted earnings also increased at double-digit rates on a per-share basis, while operating cash generation moved in the opposite direction.

Adjusted operating income and adjusted diluted EPS are non-GAAP measures. The adjustments primarily exclude stock-based compensation, acquired-intangible amortization and related tax effects; adjusted operating income also reflects other income and expense adjustments.

Business and segment performance

Advanced Technology Solutions was the main growth engine. Its revenue increased by $70.7 million, accounting for about 79% of Genpact’s total year-over-year revenue increase, while the much larger Core Business Services segment recorded limited growth.

The difference between reported revenue growth of 7.1% and constant-currency growth of 6.9% was small, indicating that currency had only a modest positive effect on the headline rate. Management linked the quarter’s momentum to client demand and Genpact’s shift toward higher-value Advanced Technology Solutions.

Profitability and share count

Gross margin expanded by approximately 60 basis points, but the improvement did not fully flow through to operating margin. Selling, general and administrative expenses rose approximately 10.4% to $294.1 million, faster than revenue, leaving both GAAP and adjusted operating margins only 10 basis points above the prior-year period.

Diluted EPS grew faster than net income partly because the diluted weighted-average share count declined approximately 3.7% year over year. Genpact repurchased about 1.6 million shares during the quarter for approximately $50 million, at an average price of $32.04 per share.

Higher earnings did not translate into stronger cash generation

Quarterly operating cash flow declined to $72 million from $177 million even as net income increased. The release did not provide a standalone breakdown explaining the quarterly decline, but the six-month cash flow statement shows substantial working-capital pressure: accounts receivable used $175.3 million of cash, while increases in other operating assets used another $111.8 million. As a result, first-half operating cash flow was $48.9 million, down from $217.8 million a year earlier.

Cash and cash equivalents stood at $517.4 million on June 30, 2026, compared with $853.8 million at the end of 2025. During the first half, Genpact repaid $363.3 million of long-term debt, spent $120.0 million on share repurchases, paid $77.5 million of earn-out consideration and distributed $63.3 million in dividends. The company also received $350 million from maturing short-term investments, which fell to zero from $350 million at year-end.

Guidance

Genpact raised its full-year outlook for Advanced Technology Solutions growth to at least 25% and adjusted diluted EPS growth to at least 12%. The release did not disclose the prior numerical levels for either measure. The Q3 outlook points to another period in which technology growth is expected to offset a flat-to-declining Core Business Services result.

Management perspective

CEO Balkrishan Kalra said Genpact’s transition toward Agentic Operations was gaining traction faster, supporting the higher Advanced Technology Solutions outlook. CFO Michael Weiner pointed to client demand, execution, record bookings, a growing backlog and continued pipeline expansion, although the release did not provide numerical booking, backlog or pipeline figures.

Risks investors should monitor

• Growth remains concentrated in Advanced Technology Solutions. The business represented 27% of revenue but supplied about four-fifths of Q2’s incremental revenue. With Core Business Services expected to be flat to slightly down in Q3, a slowdown in technology growth would have an outsized effect on consolidated performance.
• Cash conversion is lagging reported earnings. Rising receivables and other operating assets weighed on first-half cash flow. Continued working-capital use could reduce the cash available for debt reduction, repurchases and dividends.
• Expense growth could limit margin expansion. SG&A increased faster than revenue in Q2, restricting operating-margin improvement despite better gross margin. Delivering the full-year margin outlook will require continued cost control and favorable business mix.
• Non-GAAP adjustments remain material. Q2 stock-based compensation increased to $26.4 million from $21.8 million. These costs are excluded from adjusted results but affect GAAP earnings and can create dilution that share repurchases need to offset.

Summary

Genpact’s Q2 2026 performance was led by rapid Advanced Technology Solutions growth, modest margin expansion and faster EPS growth than net income. The main counterweight was weaker cash generation caused by working-capital pressure. The next points to monitor are whether technology growth can continue offsetting slower Core Business Services, whether operating cash flow recovers and whether the company can deliver its higher full-year growth and adjusted EPS targets.