EPAM Systems reported third‑quarter 2025 revenue of $1.394 billion, a 19.4% year‑over‑year increase that reflects a strong rebound in demand for its digital engineering and AI‑enabled transformation services. The growth rate is markedly higher than the 1.3% rise seen in Q3 2024, underscoring the company’s ability to capture market share in high‑margin AI projects while maintaining a solid revenue base.
Net income for the quarter was $106.8 million, down from $136.4 million in Q3 2024, largely due to higher operating expenses associated with scaling AI initiatives and a one‑time restructuring charge. Diluted earnings per share were $1.91, a decline from $2.37 in the same period last year. However, adjusted EPS rose to $3.08, beating the consensus estimate of $3.03 by $0.05. The beat was driven by disciplined cost management and a favorable mix shift toward higher‑margin AI and cloud‑based services.
Operating margin improved on a GAAP basis to 10.4% from 9.3% in Q2 2025, while non‑GAAP operating margin reached 16.0% versus 15.0% in the prior quarter. The margin expansion reflects stronger pricing power in the AI segment and improved operational leverage as revenue scales, offsetting the impact of higher headcount costs associated with AI platform development.
Management raised its full‑year 2025 revenue outlook to $5.430 billion–$5.445 billion, up from the previous guidance of $5.430 billion–$5.445 billion, and adjusted EPS guidance to $11.36–$11.44, a lift from the prior range of $11.36–$11.44. The upward revision signals confidence in sustained demand for AI‑native solutions and the company’s ability to monetize its GenAI platform while maintaining cost discipline.
CEO Balazs Fejes emphasized that the quarter’s results “demonstrate the continued strength of our AI‑native strategy and the deep engineering expertise that drives our high‑margin growth.” He added that investing in AI talent, partnerships, and platform innovation is accelerating the company’s transformation and positioning it to lead in the future world of AI‑native enterprises.
Investors responded positively to the earnings release, with market participants citing the earnings beat on both revenue and adjusted EPS, the raised full‑year guidance, and the company’s clear focus on AI as key drivers of the favorable reaction.
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