IBEX Ltd
For the period ended Dec 31, 2025. Filed Feb 5, 2026.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Dec 31, 2025 · Filed Feb 5, 2026
IBEX$49.52+15.2%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-09-30; filed 2025-11-06.
0001720420-25-000040
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-12-31; filed 2026-02-05.
0001720420-26-000006
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 114 previous paragraphs and 143 current paragraphs.
73 unchanged; 40 reworded; 26 added; 1 removed; 0 previous and 4 current paragraphs rearranged.
Tables are not compared: 6 previous and 6 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (26)
Current report
The Company delivered revenues of $164.2 million during the three months ended December 31, 2025, a 16.7% increase compared to the prior year quarter due to growth across our key verticals and digital acquisition business. Net income during the three months ended December 31, 2025 was $12.2 million, a 31.8% increase from $9.3 million during the same quarter in the prior year. Fully diluted earnings per share for the three months ended December 31, 2025 of $0.83, increased from $0.57 during the prior year quarter.
Current report
Additionally, we have continued to shift towards work at home seats, which has allowed us to rationalize a number of delivery locations in higher cost regions, especially in the United States.
Current report
Income from operations was $15.3 million during the three months ended December 31, 2025 compared to $11.9 million during the prior year quarter. The operating margin was 9.3% for three months ended December
Current report
Six Months Ended December 31, 2025 and 2024
Current report
Revenue
Current report
Our revenue was $315.4 million for the six months ended December 31, 2025, an increase of $45.0 million, or 16.6%, compared to the same period in the prior year. This increase was primarily driven by increases in our Retail & E-commerce vertical of $14.8 million, or 20.7%, HealthTech vertical of $11.0 million, or 27.9%, Travel, Transportation & Logistics vertical of $6.7 million, or 17.9%, and Other vertical of $17.2 million, or 58.2%, due to growth in our digital acquisition business, compared to the same period in the prior year. These increases were partially offset by decreases in the Telecommunications vertical of $8.8 million, or 22.8%, compared to the prior year period.
Current report
As a percentage of total revenue, our Retail & E-commerce vertical increased to 27.5% for the six months ended December 31, 2025 compared to 26.6% in the same period in the prior year, our HealthTech vertical increased to 16.0% compared to 14.6% in the prior year period, our Travel, Transportation & Logistics vertical remained consistent at 14.1% compared to 14.0% in the prior year period, and our Other vertical increased to 14.8% compared to 10.9% in the prior year period. Conversely, our Telecommunications vertical decreased to 9.4% for the six months ended December 31, 2025 compared to 14.2% in the prior year period.
Current report
Operating Expenses
Current report
Cost of services
Current report
Cost of services was $223.2 million during the six months ended December 31, 2025, an increase of $34.4 million, or 18.2%, compared to the prior year period. The increase in cost of services was primarily due to increases in payroll and related costs, reseller commissions and lead expenses, IT, facility, and local transportation expenses.
Current report
Payroll and related costs were $165.2 million during the six months ended December 31, 2025, an increase of $20.7 million, or 14.3%, compared to the prior year period, due to additional headcount to support increased revenues during the current year. As a percent of revenue, payroll cost decreased to 52.4% during the six months ended December 31, 2025 compared to 53.5% during the prior year period, reflecting the continuing trend towards lower cost, higher margin regions.
Current report
IT expenses were $4.3 million during the six months ended December 31, 2025, an increase of $1.4 million or 46.1%, compared to the prior year period, primarily due to additional software license fees.
Current report
Facility expenses were $26.4 million during the six months ended December 31, 2025, an increase of $1.8 million, or 7.4%, compared to the prior year period, primarily driven by expansions in the Philippines and Pakistan and higher expenses for our nearshore regions to support revenue growth during the current year.
Current report
Local transportation expenses were $4.2 million during the six months ended December 31, 2025, an increase of $0.9 million or 27.6%, compared to the prior year period, driven primarily by increased activity corresponding to our increased revenues during the current year.
Current report
SG&A expense
Current report
SG&A expense was $54.1 million during the six months ended December 31, 2025, an increase of $2.2 million, or 4.2%, compared to the prior year period. The increase was driven by higher payroll and related costs of $3.6 million due to higher performance-based incentives and new hires to support growth, stock-based compensation of $1.7 million due to new grants issued and a higher share price impacting liability-based grants, and higher IT expenses of $0.9 million due to additional software license fees. These increases were partially offset by favorable foreign currency impacts of $2.3 million, lower legal and professional fees of $0.9 million, and lower telecommunication, insurance, facilities and other site related expenses of $0.6 million compared to the prior year period.
Current report
D&A expense
Current report
D&A expense was $9.1 million during the six months ended December 31, 2025, an increase of $0.5 million or 5.5%, compared to the prior year period. The increase was primarily due to new capital additions in our offshore regions partially offset by lower depreciation expense resulting from an increase in fully depreciated assets. As a percentage of revenue, D&A decreased to 2.9% during the six months ended December 31, 2025 compared to 3.2% in the prior year period.
Current report
Income from operations
Current report
Interest income
Current report
Interest income during the six months ended December 31, 2025 was $0.1 million, compared to $0.9 million during the prior year period, and consisted primarily of income from invested funds.
Current report
Interest expense
Current report
Interest expense during the six months ended December 31, 2025 was $0.5 million, a decrease of $0.3 million, or 40.5%, primarily due to expenses incurred during the prior year period including the loss on extinguishment related to the termination of our PNC Credit Facility and interest expense on the convertible promissory note which was repaid during fiscal 2025.
Current report
Provision for Income Taxes
Current report
Income tax expense was $4.4 million during the six months ended December 31, 2025, consistent with the prior year period. The effective tax rate was 15.2% and 20.5% for the six months ended December 31, 2025 and
Current report
During the three and six months ended December 31, 2024, the Company also entered into a purchase agreement with The Resource Group International Limited ("TRGI"), pursuant to which the Company purchased from TRGI 3,562,341 issued and outstanding common shares of the Company for an aggregate price of $70 million, of which $45 million was paid in cash and $25 million was paid in the form of a convertible promissory note.
Removed paragraphs (1)
Previous report
Stock-based compensation expense was $0.4 million during the three months ended September 30, 2025, an increase of $0.2 million, or 168.1%, compared to the prior year quarter, primarily driven by a higher share price impacting our liability-based grants.
Reworded paragraphs (40)
Previous wording
This Form 10-Q includes certain historical consolidated financial and other data for IBEX Limited ("ibex," "we," "us," "our" or the "Company"). The following discussion provides a narrative of our financial condition and results of operations for the three months ended September 30, 2025 compared to the three months ended September 30, 2024.
Current wording
This Form 10-Q includes certain historical consolidated financial and other data for IBEX Limited ("ibex," "we," "us," "our" or the "Company"). The following discussion provides a narrative of our financial condition and results of operations for the three and six months ended December 31, 2025 compared to the three and six months ended December 31, 2024.
Previous wording
ibex delivers innovative business process outsourcing ("BPO"), smart digital marketing, online acquisition technology, and end-to-end customer engagement solutions to help companies acquire, engage, and retain valuable customers. ibex operates a global customer experiences ("CX") delivery center model consisting of 30 delivery centers around the world, while deploying next-generation technology to drive superior customer experiences for many of the world’s leading companies across various verticals, including Retail & E-commerce, HealthTech, FinTech, Utilities, and Travel, Transportation & Logistics. ibex leverages its diverse global team of approximately 36,000 employees together with industry-leading technology, including its Wave iX platform, to manage customer interactions on behalf of our clients, driving a truly differentiated customer experience.
Current wording
ibex delivers innovative business process outsourcing ("BPO"), smart digital marketing, online acquisition technology, and end-to-end customer engagement solutions to help companies acquire, engage, and retain valuable customers. ibex operates a global customer experiences ("CX") delivery center model consisting of 32 delivery centers around the world, while deploying next-generation technology to drive superior customer experiences for many of the world’s leading companies across various verticals, including Retail & E-commerce, HealthTech, FinTech, Utilities, and Travel, Transportation & Logistics. ibex leverages its diverse global team of approximately 39,000 employees together with industry-leading technology, including its Wave iX platform, to manage customer interactions on behalf of our clients, driving a truly differentiated customer experience.
Previous wording
During the three months ended September 30, 2025, the Company delivered strong financial results, and experienced growth with leading clients in our Retail & E-commerce, HealthTech, Travel, Transportation & Logistics, and Other verticals, partially offset by decreases in our Telecommunications vertical. The business performed well in several important areas this quarter, including total revenues, profitability, cash from operating activities, free cash flows, new client wins in strategic verticals, and client and vertical diversification.
Current wording
During the three and six months ended December 31, 2025, the Company delivered strong financial results, and experienced growth with leading clients in our Retail & E-commerce, HealthTech, Travel, Transportation & Logistics, and Other verticals, partially offset by decreases in our Telecommunications vertical. The business performed well in several important areas this quarter, including total revenues, profitability, cash from operating activities, client and vertical diversification, and continued expansion including seven new client wins in strategic verticals during the first half of fiscal 2026.
Previous wording
The Company delivered revenues of $151.2 million during the three months ended September 30, 2025, a 16.5% increase compared to the prior year quarter due to growth from existing and new clients launched throughout fiscal 2025 and the first quarter of fiscal 2026. Net income during the three months ended September 30, 2025 was $12.0 million, a 59.9% increase from $7.5 million during the same quarter in the prior year. Fully diluted earnings per share for the three months ended September 30, 2025 of $0.82, increased from $0.43 during the prior year quarter. These increases were driven by revenue growth in our higher margin offshore regions and improved operating margin performance. The increase in fully diluted earnings per share was driven by higher net income during the current year and fewer diluted shares outstanding compared to the prior year period.
Current wording
The Company delivered revenues of $315.4 million during the six months ended December 31, 2025, a 16.6% increase compared to the same period in the prior year due to growth from existing and new clients launched throughout fiscal 2025 and first half of fiscal 2026. Net income during the six months ended December 31, 2025 was $24.3 million, a 44.4% increase from $16.8 million during the same period in the prior year. Fully diluted earnings per share for the six months ended December 31, 2025 of $1.65, increased from $1.00 during the prior year period.
Previous wording
With the increasing applicability of AI in enhancing business processes, the BPO industry is increasingly evaluating and starting to integrate AI into its range of solutions to improve the customer experience and efficiencies. We are moving aggressively to leverage generative AI in our business. Our Wave iX technology has a three-pronged AI strategy, which continues to keep ibex at the forefront of digital transformation. Our solutions are focused on increasing agent productivity, providing deeper customer insights to elevate the customer experience and putting AI in front of the customer journey with voice and chat bots. We believe we are well positioned to leverage our leadership position in adopting new technology in the CX sector and to create significant value for our clients through the application of AI. We believe that our approach to bringing a combination of our AI-enabled solutions plus a robust set of third-party AI-enabled solutions to our clients positions us to not only be a fast-mover in the market, but also to capture an outsized share of AI-impacted future revenue, and to help minimize risk to our overall revenue and provide opportunities for future profitability enhancement. While the initial implementation of some AI-solutions may impact revenue directly derived from traditional agent-driven activities, it is our belief that by remaining on the forefront and bringing these solutions to our clients, we will be able to capture a greater share of AI-enabled revenue work and maintain and grow our overall business and results in the near- and long-term.
Current wording
With the increasing applicability of AI in enhancing business processes, the BPO industry is increasingly evaluating and starting to integrate AI into its range of solutions to improve the customer experience and efficiencies. We are moving aggressively to leverage generative AI in our business. Our Wave iX technology has a three-pronged AI strategy, which continues to keep ibex at the forefront of digital transformation. Our solutions are focused on increasing agent productivity, providing deeper customer insights to elevate the customer experience and putting AI in front of the customer journey with voice and chat bots. We believe we are well positioned to leverage our leadership position in adopting new technology in the CX sector and to create significant value for our clients through the application of AI. We believe that our approach to bringing a combination of our AI-enabled solutions plus a robust set of third-party AI-enabled solutions to our clients positions us to not only be a fast-mover in the market, but also to capture an outsized share of AI-impacted future revenue, and to help minimize risk to our overall revenue and provide opportunities for future profitability enhancement. While the initial implementation of some AI-enabled solutions may impact revenue directly derived from traditional agent-driven activities, it is our belief that by remaining on the forefront and bringing these solutions to our clients, we will be able to capture a greater share of AI-enabled revenue work and maintain and grow our overall business and results in the near- and long-term.
Previous wording
Demand for customer interaction services reflects a client’s underlying business performance and priorities. Growth in a client’s business often results in increased demand for our customer engagement solutions. Conversely, a decline in a client’s business generally results in a decrease in demand for our customer engagement solutions, shifting volume to lower cost geographies, and potential increases in demand for our customer acquisition and expansion solutions. The correlation between a client's business performance and demand for outsourced customer interaction solutions can therefore be complex, and depends upon several factors, such as industry consolidation, client investments in growth, and overall macroeconomic environment, all of which can result in short term revenue volatility for outsourcing providers. Demand during the three months ended September 30, 2025 was higher when compared to the prior year quarter due to increased demand for our digital-first solutions, growth in our existing clients, and recent new client wins in strategic verticals.
Current wording
Demand for customer interaction services reflects a client’s underlying business performance and priorities. Growth in a client’s business often results in increased demand for our customer engagement solutions. Conversely, a decline in a client’s business generally results in a decrease in demand for our customer engagement solutions, shifting volume to lower cost geographies, and potential increases in demand for our customer acquisition and expansion solutions. The correlation between a client's business performance and demand for outsourced customer interaction solutions can therefore be complex, and depends upon several factors, such as industry consolidation, client investments in growth, and overall macroeconomic environment, all of which can result in short term revenue volatility for outsourcing providers.
Previous wording
As demand for delivery locations has continued to shift towards lower cost geographies during the three months ended September 30, 2025, we are in the process of building additional capacity in our offshore regions. In addition, we continue to realize cost savings as we geographically optimize our delivery centers in higher cost regions.
Current wording
As demand for delivery locations has grown and continued to shift towards lower cost geographies during the six months ended December 31, 2025, we are in the process of building additional capacity in our offshore regions. We also continue to realize cost savings as we geographically optimize our delivery centers in higher cost regions.
Previous wording
When compensation levels of our employees increase, we may not be able to pass on such increased costs to our clients or do so on a timely basis, which tends to depress our operating profit margins if we cannot generate sufficient offsetting productivity gains. We continued to see increasing wage pressure in all of our geographies, in part brought on by the current global inflation and labor shortage, which is increasing competition for contact center agents from other sectors of the economy during the three months ended September 30, 2025. We were able to offset some of these wage increases with higher agent quality and increased productivity, higher agent retention, and increased client prices under contractual cost of living adjustments ("COLA"). Furthermore, our overall labor cost as a percentage of revenue is impacted by the aforementioned shift in delivery location from onshore delivery centers to offshore centers.
Current wording
When compensation levels of our employees increase, we may not be able to pass on such increased costs to our clients or do so on a timely basis, which tends to depress our operating profit margins if we cannot generate sufficient offsetting productivity gains. We continued to see increasing wage pressure in all of our geographies, in part brought on by the current global inflation and labor shortage, which is increasing competition for contact center agents from other sectors of the economy during the six months ended December 31, 2025. We were able to offset some of these wage increases with higher agent quality and increased productivity, higher agent retention, and increased client prices under contractual cost of living adjustments ("COLA"). Furthermore, our overall labor cost as a percentage of revenue is impacted by the aforementioned shift in delivery location from onshore delivery centers to offshore centers.
Previous wording
During the three months ended September 30, 2025, our largest client accounted for 10%, while our three largest clients accounted for 26% of our consolidated revenues. We believe our client diversification is a strength in a challenging market.
Current wording
During the six months ended December 31, 2025, our largest client accounted for 10%, while our three largest clients accounted for 26% of our consolidated revenues. We believe our client diversification is a strength and mitigates risk.
Previous wording
Our revenues are dependent upon both volumes and unit pricing for our services. Client pricing is often expressed in terms of a base price per minute or hour as well as, in limited cases, with bonuses and occasionally penalties depending upon our achievement of certain client objectives. During the fiscal year ended June 30, 2025 and the three months ended September 30, 2025, the tightening in the global labor market and corresponding wage inflation, as well as increasing facilities expenses have resulted in us pursuing and successfully negotiating price increases or COLA with many of our clients.
Current wording
Our revenues are dependent upon both volumes and unit pricing for our services. Client pricing is often expressed in terms of a base price per minute or hour as well as, in limited cases, with bonuses and occasionally penalties depending upon our achievement of certain client objectives. During the fiscal year ended June 30, 2025 and the six months ended December 31, 2025, the tightening in the global labor market and corresponding wage inflation, as well as increasing facilities expenses have resulted in us pursuing and successfully negotiating price increases or COLA with many of our clients.
Previous wording
The following summarizes the results of our operations for the three months ended September 30, 2025 and 2024:
Current wording
The following summarizes the results of our operations for the three and six months ended December 31, 2025 and 2024:
Previous wording
Our revenue was $151.2 million for the three months ended September 30, 2025, an increase of $21.5 million, or 16.5%, compared to the prior year quarter. This increase was primarily driven by increases in our Retail & E-commerce vertical of $7.9 million, or 25.0%, HealthTech vertical of $3.6 million, or 19.5%, Travel, Transportation & Logistics vertical of $2.8 million, or 15.4%, and Other vertical of $11.6 million, or 28.1%, due to growth in our digital acquisition business, compared to the prior year quarter. These increases were partially offset by decreases in the Telecommunications vertical of $4.5 million, or 22.5%.
Current wording
Our revenue was $164.2 million for the three months ended December 31, 2025, an increase of $23.5 million, or 16.7%, compared to the prior year quarter. This increase was primarily driven by increases in our HealthTech vertical of $7.4 million, or 35.1%, Retail & E-commerce vertical of $6.9 million, or 17.2%, Travel, Transportation & Logistics vertical of $3.9 million, or 20.2% and Other vertical of $7.6 million, or 51.3%, due to growth in our digital acquisition business, compared to the prior year quarter. These increases were partially offset by decreases in the Telecommunications vertical of $4.3 million, or 23.1%.
Previous wording
As a percentage of total revenue, the revenue from our Retail & E-commerce vertical increased to 26.3% compared to 24.5% in the prior year quarter, the revenue from our HealthTech vertical increased to 14.5% compared to 14.1%, the revenue from our Travel, Transportation & Logistics vertical of 14.1% remained consistent with 14.2%, and the revenue from our Other vertical increased to 35.0% compared to 31.8% in the prior year quarter. Conversely, the revenue from our Telecommunications vertical decreased to 10.2% compared to 15.4% in the prior year quarter.
Current wording
As a percentage of total revenue, our HealthTech vertical increased to 17.4% compared to 15.1% in the prior year quarter, our Travel, Transportation & Logistics vertical increased to 14.1% compared to 13.7% in the prior year quarter, our Retail & E-commerce vertical remained consistent with 28.6% in both the current and prior year quarters, and our Other vertical increased to 13.7% compared to 10.6% in the prior year quarter. Conversely, our Telecommunications vertical decreased to 8.7% compared to 13.1% in the prior year quarter.
Previous wording
Cost of services was $106.6 million during the three months ended September 30, 2025, an increase of $16.5 million, or 18.4%, compared to the prior year quarter. The increase in cost of services was primarily due to increases in payroll and related costs, reseller commissions and lead expenses, IT expenses, facility expenses, telecom, local transportation, and other site related expenses, and stock-based compensation.
Current wording
Cost of services was $116.6 million during the three months ended December 31, 2025, an increase of $17.9 million, or 18.1%, compared to the prior year quarter. The increase in cost of services was primarily due to increases in payroll and related costs, reseller commissions and lead expenses, IT, facility expenses, and local transportation expenses.
Previous wording
Payroll and related costs were $77.9 million during the three months ended September 30, 2025, an increase of $9.9 million, or 14.6%, compared to the prior year quarter, due to increased revenues during the current year quarter. As a percent of revenue, payroll cost decreased to 51.5% during the three months ended September 30, 2025 compared to 52.4% during the prior year quarter, reflecting the continuing trend towards lower cost, higher margin regions.
Current wording
Payroll and related costs were $87.4 million during the three months ended December 31, 2025, an increase of $11.2 million, or 14.7%, compared to the prior year quarter, due to additional headcount to support increased revenues during the current year quarter. As a percent of revenue, payroll cost decreased to 53.2% during the three months ended December 31, 2025 compared to 54.1% during the prior year quarter, reflecting the continuing trend towards lower cost, higher margin regions.
Previous wording
Reseller commissions and lead expenses were $8.3 million during the three months ended September 30, 2025, an increase of $4.5 million, or 119.7%, compared to the prior year quarter. These increases were primarily due to increases in the utilization of our third-party affiliates for inbound inquiries as well as search engine costs in connection with increased revenues in our higher margin digital sales and marketing efforts.
Current wording
Reseller commissions and lead expenses were $7.5 million during the three months ended December 31, 2025, an increase of $3.8 million, or 101.4%, compared to the prior year quarter. These increases were primarily due to increases in the utilization of our third-party affiliates for inbound inquiries as well as search engine costs in connection with increased revenues in our higher margin digital sales and marketing efforts.
Previous wording
IT expenses were $2.0 million during the three months ended September 30, 2025, an increase of $0.6 million, or 46.1%, compared to the prior year quarter, primarily due to additional software license fees.
Current wording
IT expenses were $2.4 million during the three months ended December 31, 2025, an increase of $0.8 million, or 46.7%, compared to the prior year quarter, primarily due to additional software license fees.
Previous wording
Facility expenses were $12.8 million during the three months ended September 30, 2025, an increase of $0.3 million, or 2.7%, compared to the prior year quarter, primarily driven by expansions in our offshore regions.
Current wording
Facility expenses were $13.5 million during the three months ended December 31, 2025, an increase of $0.9 million, or 7.2%, compared to the prior year quarter, primarily driven by expansions in the Philippines and Pakistan.
Previous wording
Telecom, local transportation, and other site related expenses were $4.3 million, an increase of $0.7 million, or 18.2%, compared to the prior year period. These increases were primarily due to increased activity corresponding to our increased revenues during the current year quarter.
Current wording
Local transportation expenses were $2.2 million, an increase of $0.5 million, or 27.9%, compared to the prior year period. These increases were primarily due to increased activity corresponding to our increased revenues during the current year quarter.
Previous wording
SG&A expense was $26.5 million during the three months ended September 30, 2025, an increase of $0.3 million, or 1.2%, compared to the prior year quarter. The change was driven by increased payroll and related costs of $1.3 million due to higher performance-based incentives and new hires to support growth, increased stock-based compensation of $1.7 million primarily due to new grants issued and a higher share price impacting our liability-based grants, increases in IT expenses of $0.6 million due to continued investments in core business management systems, as well as favorable foreign currency impacts of $2.8 million, partially offset by decreases in legal and professional fees, insurance expenses, and telecom expenses of $0.5 million compared to the prior year quarter.
Current wording
SG&A expense was $27.6 million during the three months ended December 31, 2025, an increase of $1.8 million, or 7.2%, compared to the prior year quarter. The change was driven by increased payroll and related costs of $2.2 million due to higher performance-based incentives and new hires to support growth, higher IT expenses of $0.3 million due to additional software license fees, as well as unfavorable foreign currency impacts of $0.5 million. These increases were partially offset by decreases in legal and professional fees, facilities expenses, and other expenses of $1.2 million compared to the prior year quarter.
Previous wording
D&A expense was $4.4 million during the three months ended September 30, 2025, consistent with the prior year quarter. As a percentage of revenue, D&A decreased to 2.9% during the three months ended September 30, 2025 compared to 3.4% during the prior year quarter.
Current wording
D&A expense was $4.8 million during the three months ended December 31, 2025, an increase of $0.5 million, or 10.8% compared to the prior year quarter. The increase was primarily due to new capital additions partially offset by lower depreciation expense resulting from an increase in fully depreciated assets. As a percentage of revenue, D&A was 2.9% during the three months ended December 31, 2025, consistent with 3.0% during the prior year quarter.
Previous wording
Interest income during the three months ended September 30, 2025 was $0.03 million, compared to $0.6 million during the prior year quarter and consisted primarily of income from invested funds.
Current wording
Interest income during the three months ended December 31, 2025 was $0.1 million, compared to $0.3 million during the prior year quarter and consisted primarily of income from invested funds.
Previous wording
Interest expense during the three months ended September 30, 2025 was $0.2 million, consistent with the prior year quarter.
Current wording
Interest expense during the three months ended December 31, 2025 was $0.2 million, a decrease of $0.4 million, primarily due to expenses incurred during the prior year quarter including the loss on extinguishment related to the termination of our PNC Credit Facility and interest expense on the convertible promissory note which was repaid during fiscal 2025.
Previous wording
Income tax expense was $1.5 million during the three months ended September 30, 2025, a decrease of $0.5 million when compared with the prior year quarter, primarily due to a lower effective tax rate in the current year quarter. The effective tax rate was 10.9% and 20.8% for the three months ended September 30, 2025 and 2024, respectively. The change in effective tax rates between these periods was primarily attributable to changes in revenue mix across our taxable jurisdictions and discrete tax benefits from stock-based compensation compared to the prior year quarter.
Current wording
Income tax expense was $2.9 million during the three months ended December 31, 2025, an increase of $0.5 million when compared with the prior year quarter, primarily due to higher pre-tax income in the current year quarter. The effective tax rate was 19.1% and 20.2% for the three months ended December 31, 2025 and 2024, respectively. The change in effective tax rates between these periods was primarily attributable to changes in revenue mix across our taxable jurisdictions and favorable discrete tax benefits in the current year quarter.
Previous wording
Income from operations was $13.7 million during the three months ended September 30, 2025 compared to $9.1 million during the prior year quarter. The operating margin was 9.1% for three months ended September 30, 2025, up from 7.0% for the prior year quarter. The increase was primarily driven by margin expansion as we continued to realize growth in our higher margin offshore regions and favorable foreign currency impacts compared to the prior year quarter.
Current wording
Income from operations was $29.0 million during the six months ended December 31, 2025 compared to $21.0 million during the prior year period. The operating margin was 9.2% for six months ended December 31, 2025, up from 7.8% for the prior year period. The increase was primarily driven by margin expansion as we continued to realize growth in our higher margin offshore regions and focus on site optimization efforts in our onshore regions.
Previous wording
Net income margin was 8.0% for the three months ended September 30, 2025 compared to 5.8% during the prior year quarter. This increase was primarily driven by revenue growth in our higher margin offshore regions, lower SG&A expenses as a percentage of revenue, lower income tax expenses, and foreign currency gains during the three months ended September 30, 2025 compared to the same quarter in the prior year.
Current wording
Net income margin was 7.4% for the three months ended December 31, 2025 compared to 6.6% during the prior year quarter. Net income margin was 7.7% for the six months ended December 31, 2025 compared to 6.2% during the prior year period. These increases were primarily driven by revenue growth in our higher margin offshore regions and lower SG&A expenses as a percentage of revenue, partially offset by increases in income tax and depreciation expense compared to the same periods in the prior year.
Previous wording
Adjusted EBITDA margin was 12.9% for the three months ended September 30, 2025 compared to 12.0% during the prior year quarter. This increase was primarily driven by revenue growth in our higher margin offshore regions and lower SG&A expenses as a percentage of revenue during the three months ended September 30, 2025 compared to the same quarter in the prior year.
Current wording
Adjusted EBITDA margin was 12.6% for the three months ended December 31, 2025 compared to 11.8% during the prior year quarter. Adjusted EBITDA margin was 12.7% for the six months ended December 31, 2025 compared to 11.9% during the prior year period. These increases were primarily driven by revenue growth in our higher margin offshore regions and lower SG&A expenses as a percentage of revenue during the three and six months ended December 31, 2025 compared to the same periods in the prior year.
Previous wording
Net cash provided by operating activities during the three months ended September 30, 2025 and 2024 was $15.7 million and $7.8 million, respectively. Free cash flow during the three months ended September 30, 2025 and 2024 was $8.0 million and $4.1 million, respectively. The increase in capital expenditures during the current year was driven by expansions in our offshore regions to meet demand and purchases of IT and telecommunications equipment.
Current wording
Net cash provided by operating activities during the three and six months ended December 31, 2025 was $6.6 million and $22.3 million, respectively, compared to $1.1 million and $8.9 million, respectively, during the prior year periods. Free cash flow during the three and six months ended December 31, 2025 was $(5.1) million and $2.9 million, respectively, compared to $(3.2) million and $1.0 million, respectively, during the prior year periods. The increase in capital expenditures during the current year was driven by expansions in our offshore regions to meet demand and purchases of IT and telecommunications equipment.
Previous wording
As of September 30, 2025, our principal sources of liquidity were cash and cash equivalents totaling $22.7 million, cash flows from operations, and the unused availability under our existing credit facilities with HSBC Bank USA, National Association and HSBC Bank Middle East Limited (collectively, the "HSBC Credit Facilities") of $67.4 million.
Current wording
As of December 31, 2025, our principal sources of liquidity were cash and cash equivalents totaling $15.5 million, cash flows from operations, and the unused availability under our existing credit facilities with HSBC Bank USA, National Association and HSBC Bank Middle East Limited (collectively, the "HSBC Credit Facilities") of $67.3 million.
Previous wording
As of September 30, 2025, our total indebtedness was $1.6 million, consisting of our finance leases. We were in compliance with all debt covenants as of September 30, 2025. Refer to Note 5, "Debt" in the consolidated financial statements included in this Form 10-Q for additional information on our debt.
Current wording
As of December 31, 2025, our total indebtedness was $1.4 million, consisting of our finance leases. We were in compliance with all debt covenants as of December 31, 2025. Refer to Note 5, "Debt" in the consolidated financial statements included in this Form 10-Q for additional information on our debt.
Previous wording
In connection with the HSBC Credit Facilities, the Company had deferred debt issuance costs of $0.8 million, which are included in other current assets and other non-current assets in the consolidated balance sheets as of September 30, 2025.
Current wording
In connection with the HSBC Credit Facilities, the Company had deferred debt issuance costs of $0.7 million, which are included in other current assets and other non-current assets in the consolidated balance sheets as of December 31, 2025.
Previous wording
The Board may authorize share repurchases of the Company’s common shares and the Company had multiple share repurchase plans during the three months ended September 30, 2025 and 2024. The Company’s current share repurchase program allows us to repurchase up to $15 million in shares through May 12, 2026. During the three months ended September 30, 2025 and 2024, the Company repurchased 91,658 and 282,129 shares, respectively, of its common shares totaling $2.7 million, and $4.7 million respectively. All repurchases under these programs were funded with our existing cash balance.
Current wording
The Board may authorize share repurchases of the Company’s common shares and the Company had multiple share repurchase plans during the six months ended December 31, 2025 and 2024. The Company’s current share repurchase program allows us to repurchase up to $15 million in shares through May 12, 2026. During the six months ended December 31, 2025 and 2024, the Company repurchased 169,858 and 327,230 shares, respectively, of its common shares totaling $5.6 million during each period. All repurchases under these programs were funded with our existing cash balance.
Previous wording
The following discussion highlights our cash flow activities during the three months ended September 30, 2025 and 2024:
Current wording
The following discussion highlights our cash flow activities during the six months ended December 31, 2025 and 2024:
Previous wording
The Company manages a centralized global treasury function with a focus on safeguarding and optimizing the use of its global cash and cash equivalents. The majority of the Company’s cash is held in large U.S. banks in U.S. dollars and outside of the U.S. in U.S. dollars and foreign currencies in regional or local banks in the countries it operates in. The Company believes that its cash management policies and practices effectively mitigate its risk relating to its global cash. However, the Company can provide no assurances that it will not sustain losses.
Current wording
The Company manages a centralized global treasury function with a focus on safeguarding and optimizing the use of its global cash and cash equivalents. The majority of the Company’s cash is held in large U.S. banks in U.S. dollars and outside of the U.S. in U.S. dollars and foreign currencies in regional or local banks in the countries in which it operates. The Company believes that its cash management policies and practices effectively mitigate its risk relating to its global cash. However, the Company can provide no assurances that it will not sustain losses.
Previous wording
As of September 30, 2025, we had cash and cash equivalents of $22.7 million, including $16.1 million located outside of the United States, and $2.6 million that is subject to certain local regulations on repatriation. As of June 30, 2025, we had cash and cash equivalents of $15.4 million, including $12.0 million located outside of the United States, and $2.7 million that is subject to certain local regulations on repatriation.
Current wording
As of December 31, 2025, we had cash and cash equivalents of $15.5 million, including $8.2 million located outside of the United States, and $2.2 million that is subject to certain local regulations on repatriation. As of June 30, 2025, we had cash and cash equivalents of $15.4 million, including $12.0 million located outside of the United States, and $2.7 million that is subject to certain local regulations on repatriation.
Previous wording
Net cash inflow from operating activities during the three months ended September 30, 2025 increased to $15.7 million compared to $7.8 million during the prior year quarter, which was driven by an increase in our revenues which drove increased profitability, as well as lower use of working capital.
Current wording
Net cash inflow from operating activities during the six months ended December 31, 2025 increased to $22.3 million compared to $8.9 million during the same period in the prior year, which was driven by an increase in our revenues and profitability, as well as lower use of working capital.
Previous wording
During the three months ended September 30, 2025, we incurred expenditures of $7.6 million on investing activities primarily driven by expansions in our offshore regions and purchases of IT and telecommunications equipment.
Current wording
During the six months ended December 31, 2025, we incurred expenditures of $19.4 million on investing activities primarily driven by expansions in our offshore regions and purchases of IT and telecommunications equipment.
Previous wording
During the three months ended September 30, 2024, we incurred expenditures of $3.6 million on investing activities primarily driven by expansions in our offshore and nearshore regions.
Current wording
During the six months ended December 31, 2024, we incurred expenditures of $7.9 million on investing activities primarily driven by expansions in our offshore and nearshore regions and purchases of IT and telecommunications.
Previous wording
During the three months ended September 30, 2025, we expended $0.6 million on financing activities, of which $2.8 million related to the repurchase of our common shares and $0.3 million related to principal payments on our finance leases, partially offset by net cash receipts of $2.4 million from stock transactions.
Current wording
During the six months ended December 31, 2025, we expended $2.8 million on financing activities, of which $5.6 million related to the repurchase of our common shares and $0.5 million related to principal payments on our finance leases, partially offset by net cash receipts of $3.3 million from stock transactions.
Previous wording
During the three months ended September 30, 2024, we expended $4.6 million on financing activities, of which $4.8 million related to the repurchase of our common shares and $0.2 million related to principal payments on our finance leases, partially offset by net cash receipts of $0.4 million from stock transactions.
Current wording
During the six months ended December 31, 2024, we expended $43.5 million on financing activities, of which $51.4 million related to the repurchase of our common shares, partially offset by net draws of $7.5 million from our HSBC Credit Facilities.
Rearranged current paragraphs (4)
Current report — wording carried from elsewhere
The increases in net income for both the three and six months ended December 31, 2025 were driven by revenue growth in our higher margin offshore regions resulting in improved operating margin performance. The increase in fully diluted earnings per share was driven by higher net income during the current year and fewer diluted shares outstanding compared to the same prior year periods.
Current report — wording carried from elsewhere
31, 2025, up from 8.5% for the prior year quarter. The increase was primarily driven by margin expansion as we continued to realize growth in our higher margin offshore regions compared to the prior year quarter.
Current report — wording carried from elsewhere
Reseller commissions and lead expenses were $15.8 million during the six months ended December 31, 2025, an increase of $8.3 million, or 110.6%, compared to the prior year period. These increases were primarily due to increases in the utilization of our third-party affiliates for inbound inquiries as well as search engine costs in connection with increased revenue in our higher margin digital sales and marketing efforts.
Current report — wording carried from elsewhere
2024, respectively. The changes in effective tax rates between these periods was primarily attributable to changes in revenue mix across our taxable jurisdictions and discrete items, including discrete tax benefits from stock-based compensation recorded in the current period.