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Research Alert: G Q1: Ai-driven Transformation Accelerates With 24% Advanced Tech Growth

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-- CFRA, an independent research provider, has providedwith the following research alert. Analysts at CFRA have summarized their opinion as follows:

G reported Q1 revenues of $1.30B (+7% Y/Y), beating consensus of $1.29B, with adjusted EPS of $0.98 vs. $0.84 prior year, exceeding estimates by $0.06. ATS accelerated 24% to $345M (27% of revenue) while Core Business Services grew 1% to $951M, demonstrating strong execution on strategic transformation toward higher-value AI services. The company's positioning in agentic operations continues driving robust client demand and margin expansion. Management emphasized that agentic transformation succeeds when "grounded in real-world expertise," highlighting G's competitive differentiation. Gross margin expanded to 36.4% for the 12th consecutive quarter while adjusted operating margin held steady at 17.3%, reflecting operational leverage. G repurchased $70M in shares, though operating cash flow turned negative at -$24M vs. +$40M in the prior year due to working capital timing. We believe G's focus on AI integration services positions it well to capitalize on growing digital transformation demand.

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