Sentiment Analysis of the earnings transcript to help figure out if there are any bullish or bearish sentiments that could be gathered from it. We're doing ML and AI based analysis on the earnings call to get some more insights.
Please consider a small donation if you think this website provides you with relevant information
| Statement |
|---|
| We’re seeing good progress and we expect 2024 to improve significantly |
| I’m also pleased that Thoughtworkers continue to write the books that matter to our clients |
| Bringing it all together, what we expect for 2024 is consistent margin improvement |
| Client interest and demand for our AI and AI-related work remains strong, and our team of world-class service professionals are working to bring clients’ AI ambitions to reality |
| Our investments in sales and marketing, partners, new services and capabilities positioned us as a stronger company as we head into 2024 |
| We are pleased that our pipeline is strengthening |
| While 2023 was a year of transformation, our foundation is strengthening, supported by a strong client base and long term client relationships |
| We were delighted to be recognized in the fourth quarter at number 14 on Fortune’s prestigious list of world’s best workplaces for 2023 |
| New client acquisition remains a strength and we continue to gain momentum |
| We have seen traction from our vertical focused sales model with higher new logo acquisition in energy, public and health services, and financial services and insurance verticals |
| Our DAMO managed services are getting good uptake with 30% of our top 50 clients now benefiting from the cost savings and quality improvements |
| We’re taking an early lead in AI-first software delivery and are pleased by client interest in gen-AI with over 50 client projects at year end |
| We expect continued G&A efficiencies, including non-wage related items to further support margin expansion as we progress through 2024 |
| We’re also proud of the agility that we demonstrated in our business, where we’re shifting service from one location to another without client disruption, so we did that very well |
| We are well positioned to help our clients evolve their operations to harness the power of cloud, data and AI to adapt to future success |
| I’m proud of the community and culture we’ve built and the people we’re able to attract and retain |
| The DEC helps us respond faster to clients, support the continued shift to offshore, and to manage utilization which continues to improve quarter on quarter on a seasonally adjusted basis |
| We’re pleased with the resulting cost savings in 2023 of $81 million on an annualized basis |
| I believe that we have the best talent in the industry |
| This demonstrates our utmost belief in the potential of open source to contribute towards a more sustainable and inclusive future |
| In closing, our foundation stands strong, bolstered by our client portfolio and client relations |
| Thoughtworks’ outstanding technologies underpin our reputation for innovation and though leadership |
| As we move forward, we’re well positioned to deliver extraordinary impact for our clients as they modernize and evolve their operations to harness the power of cloud data and AI and adapt for future success |
| We also have touched on the move from onshore work to more offshore work, so actually we’re very proud of maintaining the client relationships as we have and as Xiao has talked about |
| We’re excited about the opportunities ahead of us as we focus upon returning to growth |
| That said, we are seeing some openings of discretionary spending where there’s a strong case for ROI, and we closed quite a few large deals in Q4 and early Q1 which will ramp up in due time, and then we feel very good about win rate on the large deals |
| We are seeing a lot of strength in demand in data, and that’s where we see the demand remaining very strong - it was in fourth quarter and it continues to be now in Q1 |
| Across the three main markets in APAC, Singapore is seeing very healthy growth, it has been seeing that consistently over the last few quarters |
| We are hiring; however, we have a very strong recruiting capability, we have a very, very strong employer brand, and so we continue to hire in select pockets, particularly in geos where we’re more sold out or for skill sets - I mentioned data earlier, where we continue to see strong demand |
| At the same time, we have also centralized the management of most of our professional services people into this global structure, called DEC, and then over time we should definitely see better capacity planning, utilization, optimization, and also deliver efficiency in the long run |
| Statement |
|---|
| About two-thirds of the revenue shortfall was due to specific supply side limitations |
| Our Q4 adjusted gross margin saw year-over-year headwinds due to the temporary cost of shifting mix offshore, as well as high single digit pricing declines on a like-for-like basis |
| Continued client caution resulted in smaller project ramp-ups, more project delays, and we had slightly higher pricing pressure than we anticipated |
| Guo Xiao Sure, so as you point out, performance across our industry verticals was down in Q4, reflecting the challenging macro environment, including auto, I think the most resilient vertical for us |
| If the pipeline conversion slows down from where we’re seeing today or the pricing pressure continues to get worse, we’ll probably be trending towards the low end of our guidance, which means that the sequential growth will be further delayed |
| For 2023, we recorded bookings of $1.2 billion, down 14% compared to 2022 as cautious client behavior throughout the year pressured contract length and sizing |
| Among our industry verticals, revenue declined by 5% year-over-year in automotive, travel and transportation, 11% in financial services and insurance, 21% in energy, public and health services, 24% in technology and business services, and 26% in retail and consumer |
| Revenues were $252 million, representing a year-over-year decline of 19% |
| 2023 was a challenging year as we navigated a difficult macroeconomic environment |
| As Xiao noted earlier, if we look at our revenue actual versus our guidance, about two-thirds of that miss was related to internal factors, and as we commented but is certainly worth restating, these are factors that we see as temporary limits to our supply |
| We recognize that the fourth quarter was short of what we originally guided to in November |
| We’re also seeing some supply constraints around particular skill sets |
| Then as we talked about, the pricing assumption embedded in our guidance is a headwind for 2023 |
| It’s stabilizing with respect to project turn, but we also at the same time continue to see pricing headwinds, project delays and slower ramp-ups |
| Moving to our full year 2024 outlook, we expect revenues in the range of $980 million to $1.01 billion, reflecting a year-over-year decline of 13% to 10%, or a decline of 13% to 11% in constant currency |
| In constant currency, revenue declined 20% |
| You know, it is fair to say that we did see impact from the revenue headwind on our EBITDA and our margins |
| Our Q1 guidance continues to factor in the cautious behavior that clients exhibited in 2203 and that continues today |
| Turning to our full year 2023 results, we recorded revenue of $1.1 billion, down 13% versus 2022 in both U.S |
| For the quarter, we saw year-over-year declines of 10% in APAC, 20% in Europe, 23% in North America, and 38% in LatAm |
Please consider a small donation if you think this website provides you with relevant information