Grid Dynamics Q1 revenue rises 3.7%, beats estimates on record AI sales

Overview

• Enterprise AI services firm's Q1 revenue rose 3.7% yr/yr, slightly beating analyst expectations

• Adjusted EPS for Q1 beat analyst expectations

• Company reported record AI revenues and growth in technology, media, and telecom verticals

Outlook

• Grid Dynamics expects Q2 revenue between $106 mln and $108 mln

• Company sees Q2 non-GAAP EBITDA of $14 mln to $15 mln

• Grid Dynamics expects 2026 revenue of $435 mln to $465 mln, up 5.6%-12.9%

Result Drivers

• TMT VERTICAL GROWTH - Revenue growth was led by the Technology, Media and Telecom vertical, which increased 30.3% yr/yr, driven by top technology customers

• RECORD AI REVENUES - AI-related services reached 29.3% of total revenue, reflecting increased adoption of AI offerings and new platform rollouts

• FINANCE DEMAND - Finance vertical performed strongly due to robust demand from fintech and banking customers

Company press release: ID:nBw45HDbma

Key Details

*Applies to a deviation of less than 1%; not applicable for per-share numbers.

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 6 "strong buy" or "buy", no "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the it services & consulting peer group is "buy"

• Wall Street's median 12-month price target for Grid Dynamics Holdings Inc is $10.50, about 87.2% above its April 29 closing price of $5.61

• The stock recently traded at 12 times the next 12-month earnings vs. a P/E of 19 three months ago

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