Managed services News
Perficient CEO: ‘Pipeline Remains Strong’ With Focus On Global Expansion
Joseph F. Kovar
‘We’re uniquely positioned due to our two decades of presence and strength in the United States. We’ve now built, and continue to build, meaningful global depth in Latin America and India with tremendous talent,’ says Perficient Chairman and CEO Jeffrey Davis in prepared remarks.
Global digital consultancy company Perficient is looking to build on its current growth with an increased international presence it said will help both its U.S. and international business.
Jeffrey Davis, chairman and CEO of the St. Louis, Mo.-based global solution provider, Thursday told financial analysts during the company’s third fiscal quarter 2022 financial conference call that the company is doing well in the face of macroeconomic headwinds.
“The pipeline remains strong, in fact larger than ever, and we’re pursuing several eight-figure deals,” Davis said during his prepared remarks. “Now, we are seeing a modest increase in sales cycles, with some customers deliberating a little longer given the macroeconomic inputs. But because our work primarily involves mission-critical projects in which enterprises must invest and do prioritize, we’re not overly concerned at this point. The breadth and depth of our portfolio ensures Perficient delivers material in environments of strength or weakness, whether our clients are investing in growth or seeking to reduce costs by leveraging efficiency, Perficient is the answer.”
Offshore investments are expected to provide an important source of growth going forward for Perficient, which was ranked no. 51 on CRN’s 2022 Solution Provider 500.
Organic offshore revenue grew 32 percent in the quarter, and overall offshore revenue grew 72 percent, Davis said.
“On an apples-for-apples basis, that component of our business is growing as fast as anyone in the industry,” he said. “Our fully-integrated global delivery model continues to resonate with clients who value the combination of our local and global approach.”
Perficient grew its offshore presence by over 600 people during the quarter with the acquisition of Mexico-based Inflection Point Systems and India-based Ameex Technologies, Davis said.
“We’re uniquely positioned due to our two decades of presence and strength in the United States,” he said. “We’ve now built, and continue to build, meaningful global depth in Latin America and India with tremendous talent. Our teams in those regions are not bolt-on staff augmentation resources. They are true experts, peers on par with our senior leaders in the United States. And our fully integrated approach is what our customers want, and ensures we can deliver meaningful value from anywhere in the world.”
This shift will increase margins, but also provide headwinds to revenue growth.
“Eventually, however, it will prove an accelerant to both.”
For its third fiscal quarter 2022, which ended Sept. 30, Perficient reported revenue of $227.6 million, up about 18 percent over the $192.8 million the company reported for its third fiscal quarter 2021.
That included services revenue of $227.0 million, up from $192.4 million, and software and hardware revenue of $570,000, up from $401,000.
That revenue figure missed analyst expectations by $2.83 million, according to Seeking Alpha.
GAAP net income for the quarter was $23.0 million or 68 cents per share, up from $17.4 million or 48 cents per share. On a non-GAAP basis, the company reported net income of $37.9 million or $1.11 per share, up from $29.5 million or 88 cents per share. Earnings on a non-GAAP basis beat analyst expectations by 1 cent per share, according to Seeking Alpha.
Looking forward, Perficient expects fourth fiscal quarter 2022 revenue to be in the range of $233 million to $239 million, with GAAP earnings in the range of 69 cents to 74 cents per share, and non-GAAP earnings in the range of $1.11 to $1.16 per share.
Perficient also updated its full fiscal 2022 revenue guidance to a range of $905 million to $911 million, with GAAP earnings now expected to be in a range of $2.85 to $2.90 per share and non-GAAP earnings in a range of $4.25 to $4.30 per share. Analysts had been planning for $3.16 per share, according to Seeking Alpha.