Concentrix Stock Falls Sharply After Earnings. Here’s Why.

Concentrix lowered its fiscal-year adjusted earnings and revenue guidance. (Dreamstime)

Key Points

About This Summary

• Concentrix falls sharply after the company lowers its fiscal 2025 adjusted earnings guidance.
• The company narrows its fiscal 2025 revenue guidance to $9.8 billion-$9.82 billion, citing a slower return to stability.
• Fiscal third-quarter adjusted earnings of $2.78 a share miss analysts’ expectations.

Concentrix stock tumbled Friday after the customer experience technology company slashed its fiscal-year outlook, citing a slower-than-expected “return to stability” against a tumultuous macroeconomic backdrop.

Concentrix guided for adjusted earnings in the range of $11.11 to $11.23 a share in fiscal 2025, down from previous guidance of $11.53 to $11.76 a share. The company also narrowed its revenue guidance range to $9.8 billion to $9.82 billion, compared to earlier expectations for $9.72 billion to $9.82 billion.

The company’s fiscal third-quarter earnings report was mixed. Adjusted earnings came in at $2.78 a share, below analysts’ expectations for $2.87, while revenue rose 4% to $2.48 billion and narrowly beat forecasts for $2.46 billion.

On the earnings call, Chief Financial Officer Andre Valentine said the company had expected a “faster return to stability,” as only “a handful of clients” were impacted by tariffs in the second quarter.

However, this didn’t materialize. “We’re doing the right thing for our clients long term, but in-quarter volumes didn’t materialize how the clients or we envisioned,” Valentine said, blaming a resulting excess in capacity “for the majority of the shortfall.”

Shares declined 8.4% to $50.35 on Friday after falling more than 20% in premarket trading. The benchmark S&P 500 was flat.

Write to Mackenzie Tatananni at mackenzie.tatananni@barrons.com