Globant SA (NYSE:GLOB) Gross Margin Falls

Globant SA (NYSE:GLOB) stock fell 7.17% (As on May 20, 11:07:21 AM UTC-4, Source: Google Finance) though the company posted better than expected results for the first quarter of FY 22. Non-IFRS Adjusted Gross Profit Margin was 39.5% compared to 39.6% in the first quarter of 2021. Non-IFRS Adjusted Profit from Operations Margin was 16.8% compared to 16.6% in the first quarter of 2021. Cash and cash equivalents and Short-term investments were $370.1 million as of March 31, 2022, a decrease of $90.3 million from $460.4 million as of December 31, 2021, driven by seasonal impacts of tax and bonus payments, and a number of M&A earnouts. As of March 31, 2022, the credit facility was fully undrawn. Globant has completed the first quarter of 2022 with 24,504 Globers, 23,158 of whom were technology, design and innovation professionals. The geographic revenue breakdown for the first quarter of 2022 was as follows: 63.1% from North America (top country: US), 23.5% from Latin America (top country: Chile), 11.1% from EMEA (top country: Spain) and 2.3% from Asia and Oceania (top country: India). In terms of currencies, 80.6% of Globant’s revenues for the first quarter of 2022 were denominated in US dollars. Globant’s top customer, top five customers and top ten customers for the first quarter of 2022 represented 11.0%, 28.0% and 38.6% of revenues, respectively. The company has enhanced its capabilities to scale and identify new trends like AI, Augmented Reality, the Metaverse, and Blockchain.

GLOB in the first quarter of FY 22 has reported the adjusted earnings per share of $1.19, beating the analysts’ estimates for the adjusted earnings per share of $1.17, according to Zacks Investment Research. The company had reported the adjusted revenue growth of 48.6 percent to $401.4 million in the first quarter of FY 22, beating the analysts’ estimates for revenue of $398 million.

For the second quarter ending in July, Globant expects its per-share earnings to be $1.20. The company said it expects revenue in the range of $425.5 million for the fiscal second quarter. Second quarter 2022 Non-IFRS Adjusted Profit from Operations Margin is estimated to be in the range of 16%-17%.

Globant expects full-year earnings to be $4.94 per share, with revenue expected to be $1.77 billion. Fiscal year 2022 Non-IFRS Adjusted Profit from Operations Margin is estimated to be in the range of 16%-17%.

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