Concentrix Shares Drop 11% After Disappointing Guidance

Concentrix Shares Drop After Weaker Guidance

NEWARK, Calif. – Concentrix Corporation experienced an 11.8% decline in its stock price during after-hours trading on Wednesday, following the release of disappointing guidance for the fourth quarter and full year.

In its third-quarter report, Concentrix posted adjusted earnings per share (EPS) of $2.87, falling short of analyst expectations, which averaged $2.93. The company reported revenue of $2.39 billion, slightly surpassing the consensus estimate of $2.38 billion and marking a 46.2% increase year-over-year. Adjusted for constant currency, revenue grew by 2.6% compared to the same quarter in the previous year.

Despite the positive growth, the company’s outlook raised concerns among investors. For the fourth quarter, Concentrix anticipates adjusted EPS between $2.90 and $3.16, significantly lower than the analyst projection of $3.48. Fourth-quarter revenue guidance is estimated at between $2.42 billion and $2.47 billion, which aligns with expectations of $2.465 billion.

Looking at the full fiscal year 2024, Concentrix’s guidance also did not meet analysts’ forecasts. The company projects adjusted EPS of $11.05 to $11.31, compared to the consensus estimate of $11.71. Revenue for the full year is anticipated to be between $9.591 billion and $9.641 billion, slightly below the expected $9.633 billion.

Chris Caldwell, President and CEO of Concentrix, stated, "Our third quarter marked another quarter of solid revenue growth and operating results. We are also delighted to leverage our technology investments to bring our iX Hello product to market with velocity."

In terms of shareholder returns, Concentrix returned $60 million through share repurchases and dividends during the quarter, and announced a 10% increase in its quarterly dividend to $0.33275 per share.