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Information Services GroupD
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Investor releaseQuarter not tagged2026-08-11

Information Services Group Inc (III) (Q2 2026) Earnings Call Highlights: AI Revenue Surges 64% ...

GuruFocus.com
This article first appeared on GuruFocus. Revenue: $65.5 million, up 6.4% year-over-year, including a $700,000 positive impact from FX. Adjusted EBITDA: $9.4 million, up 12.9% year-over-year, with margin expanding 80 basis points to 14.3%. Operating Income: $5.9 million, up 25.6% year-over-year, resulting in an operating margin of 8.9%. GAAP Net Income: $3.3 million, or $0.07 per fully diluted share, compared with $2.2 million or $0.04 per share last year. Adjusted Net Income: $5 million, or $0.10 per fully diluted share, up from $4.1 million or $0.08 per share a year ago. Americas Revenue: $42.1 million, up 6.7% year-over-year. Europe Revenue: $18.3 million, up 9.8% year-over-year. Asia Pacific Revenue: $5.1 million, down 6.7% year-over-year. Recurring Revenue: Record $30 million, up 7% year-over-year. AI-Related Revenue: $26 million in Q2, up 64% year-over-year; $47 million for the first half, representing 37% of firmwide revenue. Cash Flow: Net cash generated from operations was $5.2 million in Q2, compared to a $700,000 cash usage in Q1. Cash Position: Ended the quarter with $23.7 million in cash, up from $22.7 million at the end of Q1. Headcount: 1,281 at quarter end, essentially flat with last quarter; consulting utilization remained solid at 74%. Share Repurchase: Board approved a new $30 million share repurchase authorization, the largest in company history; repurchased $1.5 million of stock during the quarter. Dividends: Paid $2.3 million in dividends during the quarter; next quarterly dividend will be paid September 25. Debt: Gross debt-to-EBITDA ratio was 1.7 times, down from 1.9 times at September 31, 2025; average borrowing rate was 5.3%, down 81 basis points year-over-year. Q3 Guidance: Targeting revenues between $63.5 million and $64.5 million and adjusted EBITDA between $8.5 million and $9.5 million. Warning! GuruFocus has detected 3 Warning Signs with III. Is III fairly valued? Test your thesis with our free DCF calculator. Release Date: August 06, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Information Services Group Inc (NASDAQ:III) reported strong Q2 results with revenue of $65.5 million, up 6.4% year-over-year, and adjusted EBITDA of $9.4 million, up 12.9%, both exceeding expectations. AI-related revenue surged 64% to $26 million in Q2, with first-half AI revenue reaching $47…Read full document

This article first appeared on GuruFocus. Revenue: $65.5 million, up 6.4% year-over-year, including a $700,000 positive impact from FX. Adjusted EBITDA: $9.4 million, up 12.9% year-over-year, with margin expanding 80 basis points to 14.3%. Operating Income: $5.9 million, up 25.6% year-over-year, resulting in an operating margin of 8.9%. GAAP Net Income: $3.3 million, or $0.07 per fully diluted share, compared with $2.2 million or $0.04 per share last year. Adjusted Net Income: $5 million, or $0.10 per fully diluted share, up from $4.1 million or $0.08 per share a year ago. Americas Revenue: $42.1 million, up 6.7% year-over-year. Europe Revenue: $18.3 million, up 9.8% year-over-year. Asia Pacific Revenue: $5.1 million, down 6.7% year-over-year. Recurring Revenue: Record $30 million, up 7% year-over-year. AI-Related Revenue: $26 million in Q2, up 64% year-over-year; $47 million for the first half, representing 37% of firmwide revenue. Cash Flow: Net cash generated from operations was $5.2 million in Q2, compared to a $700,000 cash usage in Q1. Cash Position: Ended the quarter with $23.7 million in cash, up from $22.7 million at the end of Q1. Headcount: 1,281 at quarter end, essentially flat with last quarter; consulting utilization remained solid at 74%. Share Repurchase: Board approved a new $30 million share repurchase authorization, the largest in company history; repurchased $1.5 million of stock during the quarter. Dividends: Paid $2.3 million in dividends during the quarter; next quarterly dividend will be paid September 25. Debt: Gross debt-to-EBITDA ratio was 1.7 times, down from 1.9 times at September 31, 2025; average borrowing rate was 5.3%, down 81 basis points year-over-year. Q3 Guidance: Targeting revenues between $63.5 million and $64.5 million and adjusted EBITDA between $8.5 million and $9.5 million. Warning! GuruFocus has detected 3 Warning Signs with III. Is III fairly valued? Test your thesis with our free DCF calculator. Release Date: August 06, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Information Services Group Inc (NASDAQ:III) reported strong Q2 results with revenue of $65.5 million, up 6.4% year-over-year, and adjusted EBITDA of $9.4 million, up 12.9%, both exceeding expectations. AI-related revenue surged 64% to $26 million in Q2, with first-half AI revenue reaching $47 million, representing 37% of firmwide revenue, indicating strong growth in this area. Recurring revenues hit a record $30 million in Q2, up 7%, driven by research and governance businesses, providing better revenue visibility and stability. The company expanded its share buyback program by $30 million, the largest in its history, reflecting confidence in its financial position and commitment to returning capital to shareholders. Europe showed strong momentum with 10% revenue growth, and the Americas grew 7%, with broad-based growth across regions, service lines, and industries, including key client wins and expansions. Asia Pacific revenues declined 6.7% year-over-year to $5.1 million, though the company expects a return to growth in the second half. Client spending remains measured, with decision-making pace still cautious, which could impact the timing of revenue recognition and growth. The company faces potential headwinds from geopolitical issues in Europe, which may slow AI adoption and spending in that region compared to the US. Acquisition valuations are becoming more 'frothy' with rising seller expectations, which could make strategic acquisitions more expensive and potentially less accretive. Despite strong results, the company's guidance for Q3 revenue ($63.5-$64.5 million) implies a sequential decline from Q2, reflecting seasonal summer impacts in Europe and ongoing caution. Q: Could you provide any color on what you're seeing in terms of total enterprise technology spend with your clients and across the industry, and how it compares to three to six months ago?A: Michael Connors (Chairman and CEO) stated that there is a clear shift in technology budgets from day-to-day operations toward growth initiatives, especially AI. While the pace of decision-making remains measured, it is much faster than a year ago. He noted that infrastructure and software spending are compounding, while labor-based work faces pressure to improve productivity. The spending is accelerating in AI as enterprises begin to scale, but it is still very early innings. Q: How does your visibility compare today to six to 12 months ago, and are there any large deals in your pipeline that could significantly benefit your growth trajectory?A: Michael Connors (Chairman and CEO) said visibility is roughly the same, with no deterioration, and the pipeline is strong. He confirmed there are several large engagements being pursued that could provide a "nice jolt" if they close sooner rather than later, but he could not project their timing. He expressed optimism, noting that research and governance, especially AI governance, is resonating well with clients. Q: How should we think about the economics of your consulting business, given that clients know AI is reducing consulting costs? Is there any pressure on billing rates?A: Michael Sherrick (CFO and EVP) explained that the firm is not seeing pressure on billing rates because the focus is on the value provided. He noted that AI is driving a more rapid acceleration in clients' reviews of existing programs and contracts, which will drive more transactions. He reiterated that AI is a tailwind and a benefit for the firm. Q: Recurring revenues seem to have stabilized this quarter. Is this a fair run rate moving forward, or are there goals to grow this?A: Michael Connors (Chairman and CEO) highlighted that recurring revenues reached a record $30 million in the quarter, up 7%, driven by research and governance businesses, including AI governance. He stated the objective is to get recurring revenue to over 50% of total revenue, up from roughly 45-47% currently and about half of that five years ago. He expects this to continue growing over the next couple of years. Q: You previously mentioned the AI Maturity Index was a door opener. What is typically the next service clients purchase, and how long does that conversion take?A: Michael Connors (Chairman and CEO) explained that the AI index is used as a top-of-funnel tool to start conversations. The firm focuses on workforce readiness, AI economics, and governance to help clients turn productivity into credible business economics. This approach is driving AI-related revenue, which reached $26 million in the quarter, up significantly year-over-year. Q: Is the AI governance work genuinely new demand, or are you winning it from competitors or internal teams? Will it change the mix of your top 10 clients?A: Michael Connors (Chairman and CEO) confirmed that the AI component of governance is new and incremental, representing "new white space" for the firm. He noted that every business is thinking about it, including at the board level. While it may not change the top 10 client mix by itself, it adds to revenue from top clients and helps expand relationships with both current clients and new prospects. Q: Martino has been in the mix for about a year now. How much of the growth is Martino, and is it tracking the early earnout targets you underwrote?A: Michael Connors (Chairman and CEO) stated that Martino is not material to the overall results but is performing well. The entire European region, including Italy, was up 10% year-over-year, driven by increased demand in the European theater. He advised not to look at Martino as having any materiality in the quarter. Q: On the gross margin side, are we looking at a plateau, or was there something specific about this quarter?A: Michael Sherrick (CFO and EVP) said there was nothing specific or different in the quarter regarding gross margins. He attributed some margin variation to the mix of different offerings and services. He reiterated that the firm maintains a strong value proposition, which allows it to price effectively, and that has not changed. Q: Can you talk about the visibility you have currently relative to a year ago, given the strength of recurring revenues and the shift from a defensive to an offensive stance?A: Michael Connors (Chairman and CEO) said the pipeline is probably as strong as it has ever been. Recurring revenue, now representing almost 50% of the business, provides clear visibility, as 85% of revenue comes from a base of 900 clients. He noted that demand is good, and the firm is focused on the most important client prioritiescost optimization and AI adoptionwhich fits its portfolio of services. He highlighted disruption in industries like healthcare and energy as drivers of future acceleration. Q: Could you share your views on the potential for acquisitions, including availability and valuations?A: Michael Connors (Chairman and CEO) confirmed the firm remains acquisitive and is looking at capabilities to accelerate growth, focusing on digital and AI. He noted that value expectations on the sell side are beginning to rise and are "a little more frothy" than a year ago. The firm is active in the market but is keeping an eye on rising expectations. Q: Are you seeing differentiation of catalysts in Europe versus the Americas?A: Michael Connors (Chairman and CEO) said that in Europe, consumer, pharma, and M&A are very active, more so than six to nine months ago. He noted that M&A is picking up in the region, driving both diligence and portfolio cleanup work. In the US, the bigger drivers are healthcare, energy, and utilities, which differ from the European catalysts. For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Investor releaseQuarter not tagged2026-08-06

Information Services Group Q2 Earnings Call Highlights

MarketBeat
Interested in Information Services Group, Inc.? Here are five stocks we like better. Strong second-quarter performance: Revenue rose 6.4% to $65.5 million and adjusted EBITDA increased 12.9% to $9.4 million, with margin expanding to 14.3%. Growth was led by the Americas and Europe. AI and recurring revenue accelerated: AI-related revenue jumped 64% year over year to $26 million, while recurring revenue reached a record $30 million. ISG is targeting recurring revenue above 50% of total revenue and sees AI governance as a major growth opportunity. Capital returns and outlook: The board authorized a record $30 million share-repurchase program, with buybacks expected to accelerate in the second half. ISG forecast third-quarter revenue of $63.5 million to $64.5 million and adjusted EBITDA of $8.5 million to $9.5 million. These 4 Low P/E Tech Stocks Could be Breakout-Ready Bargains Information Services Group (NASDAQ:III) reported second-quarter revenue and adjusted EBITDA above its expectations, citing growth in the Americas and Europe, record recurring revenue and rising demand for AI-related advisory, research and governance services. Revenue for the quarter ended June 30 was $65.5 million, up 6.4% from a year earlier, including a $700,000 favorable foreign-exchange impact. Adjusted EBITDA rose 12.9% to $9.4 million, while adjusted EBITDA margin expanded 80 basis points to 14.3%. → 3 Drone Stocks That Should Soar After the Summer Slump Chairman and Chief Executive Officer Michael Connors said the company’s revenue and EBITDA results were its best since 2023. He attributed the performance to enterprises’ focus on cost reduction, modernization, business transformation and responsible AI adoption. “AI is a tailwind for ISG,” Connors said, adding that the company is positioning itself as an AI-centered technology research and advisory firm while also using AI to improve service delivery. → Meta’s Earnings Drop Shows Wall Street Wants More Than Ad Growth AI-related revenue increased 64% year over year to $26 million in the second quarter, according to Connors. For the first half of 2026, AI-related revenue totaled $47 million, representing 37% of firm-wide revenue. Nearly half of ISG’s clients generated AI-related revenue during the quarter, with consumer, health sciences and manufacturing among the leading industries. Connors said AI is increasingly integrated into…Read full document

Interested in Information Services Group, Inc.? Here are five stocks we like better. Strong second-quarter performance: Revenue rose 6.4% to $65.5 million and adjusted EBITDA increased 12.9% to $9.4 million, with margin expanding to 14.3%. Growth was led by the Americas and Europe. AI and recurring revenue accelerated: AI-related revenue jumped 64% year over year to $26 million, while recurring revenue reached a record $30 million. ISG is targeting recurring revenue above 50% of total revenue and sees AI governance as a major growth opportunity. Capital returns and outlook: The board authorized a record $30 million share-repurchase program, with buybacks expected to accelerate in the second half. ISG forecast third-quarter revenue of $63.5 million to $64.5 million and adjusted EBITDA of $8.5 million to $9.5 million. These 4 Low P/E Tech Stocks Could be Breakout-Ready Bargains Information Services Group (NASDAQ:III) reported second-quarter revenue and adjusted EBITDA above its expectations, citing growth in the Americas and Europe, record recurring revenue and rising demand for AI-related advisory, research and governance services. Revenue for the quarter ended June 30 was $65.5 million, up 6.4% from a year earlier, including a $700,000 favorable foreign-exchange impact. Adjusted EBITDA rose 12.9% to $9.4 million, while adjusted EBITDA margin expanded 80 basis points to 14.3%. → 3 Drone Stocks That Should Soar After the Summer Slump Chairman and Chief Executive Officer Michael Connors said the company’s revenue and EBITDA results were its best since 2023. He attributed the performance to enterprises’ focus on cost reduction, modernization, business transformation and responsible AI adoption. “AI is a tailwind for ISG,” Connors said, adding that the company is positioning itself as an AI-centered technology research and advisory firm while also using AI to improve service delivery. → Meta’s Earnings Drop Shows Wall Street Wants More Than Ad Growth AI-related revenue increased 64% year over year to $26 million in the second quarter, according to Connors. For the first half of 2026, AI-related revenue totaled $47 million, representing 37% of firm-wide revenue. Nearly half of ISG’s clients generated AI-related revenue during the quarter, with consumer, health sciences and manufacturing among the leading industries. Connors said AI is increasingly integrated into research, sourcing, governance and advisory assignments, creating opportunities for larger engagements and expanded client relationships. He identified AI governance as incremental demand and “new white space” for the firm, as companies seek to manage AI safely and at scale. → Jersey Mike's Serves Fresh Gains After IPO Stumble Recurring revenue reached a quarterly record of $30 million, up 7% year over year, driven by the research and governance businesses. Connors said ISG’s objective is to generate more than 50% of total revenue from recurring sources. The company currently estimates recurring revenue at roughly 45% to 47% of its business, compared with about half that level five years ago. During the question-and-answer session, Connors said enterprise clients are shifting portions of technology budgets away from routine operations and toward growth initiatives, particularly AI. While decision-making remains measured, he said clients are making decisions more actively than they were in 2024 and early 2025. Americas revenue rose 6.7% to $42.1 million, with double-digit growth in research and governance as well as the health sciences and insurance verticals. The company cited client engagements with 3M, Suntory and the Commonwealth of Pennsylvania. Connors said ISG expanded a relationship with a major global oil and gas company, adding $1 million in revenue to an existing multimillion-dollar account. The company is supporting the client’s technology transformation, including service-agreement and provider ecosystem changes, AI initiatives and a major application-sourcing program that ISG expects will save the client more than $100 million. Europe revenue increased 9.8% to $18.3 million, supported by double-digit growth in advisory, software and governance services. Consumer, banking, manufacturing and health sciences were among the stronger verticals. Key European clients included Roche, Olympus and BNP Paribas. Connors said Europe remains behind the United States in AI spending, but demand has improved as companies increasingly view AI as a competitive tool for speed, quality and productivity. He also pointed to activity in European consumer, pharmaceutical and merger-and-acquisition-related work. Asia-Pacific revenue was $5.1 million, down 6.7% from the prior-year period. However, the region posted double-digit growth in health sciences, energy and utilities, and ISG saw what Connors described as a public-sector spending breakthrough late in the quarter. The company expects the region to return to growth during the second half of 2026. Operating income increased 25.6% year over year to $5.9 million, producing an 8.9% operating margin, which Chief Financial Officer Michael Sherrick said was a three-year high. GAAP net income was $3.3 million, or $0.07 per diluted share, compared with $2.2 million, or $0.04 per diluted share, a year earlier. Adjusted net income rose to $5 million, or $0.10 per diluted share, from $4.1 million, or $0.08 per diluted share, in the prior-year quarter. ISG ended the quarter with $23.7 million in cash, up from $22.7 million at the end of the first quarter. Net cash generated from operations was $5.2 million, compared with cash usage of $700,000 in the first quarter. The company said it expects strong operating cash flow for the remainder of the year. Headcount was 1,281 at quarter-end, essentially unchanged from the prior quarter, while consulting utilization was 74%. ISG’s gross debt-to-EBITDA ratio declined to 1.7 times from 1.9 times at the end of 2025, and its average borrowing rate fell 81 basis points year over year to 5.3%. The board approved a new $30 million share-repurchase authorization, the largest in company history. The new authorization will begin after the current program, which had about $2.3 million remaining as of June 30, is completed. During the quarter, ISG paid $2.3 million in dividends and repurchased $1.5 million of stock. Connors said the company expects buyback activity to accelerate in the second half. For the third quarter, ISG projected revenue of $63.5 million to $64.5 million and adjusted EBITDA of $8.5 million to $9.5 million. Connors said the outlook accounts for the summer months in Europe and is expected to extend the company’s year-over-year revenue growth and margin expansion. Management said its pipeline remains strong, though visibility has not materially improved from six to 12 months ago because the timing of client decisions remains uncertain. Connors said the company is pursuing several large engagements but did not provide projections for their potential timing or impact. Sherrick said ISG has not seen pressure on consulting billing rates from clients’ use of AI. Instead, he said AI is accelerating companies’ review of programs and contracts, potentially increasing transaction activity for the company’s services. Information Services Group, Inc (ISG) is a leading global technology research and advisory firm specializing in digital transformation, sourcing strategies and technology-driven business operations. Headquartered in Stamford, Connecticut, the company leverages deep market insights and data analytics to help clients optimize cost structures, accelerate growth and navigate complex technology landscapes. Since its founding in 2006, ISG has cultivated expertise across industries including financial services, healthcare, manufacturing and the public sector. ISG's core offerings include sourcing advisory, managed governance, market intelligence and research services. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "Information Services Group Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for August 2026.

Investor releaseQuarter not tagged2026-08-06

Information Services Group (III) Q2 Earnings and Revenues Surpass Estimates

Zacks
Information Services Group (III) came out with quarterly earnings of $0.1 per share, beating the Zacks Consensus Estimate of $0.09 per share. This compares to earnings of $0.08 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of +11.11%. A quarter ago, it was expected that this market advisory service company would post earnings of $0.08 per share when it actually produced earnings of $0.09, delivering a surprise of +12.5%. Over the last four quarters, the company has surpassed consensus EPS estimates three times. ISG, which belongs to the Zacks Consulting Services industry, posted revenues of $65.49 million for the quarter ended June 2026, surpassing the Zacks Consensus Estimate by 4.36%. This compares to year-ago revenues of $61.56 million. The company has topped consensus revenue estimates four times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. ISG shares have lost about 24.2% since the beginning of the year versus the S&P 500's gain of 13%. While ISG has underperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for ISG was mixed. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the shares are expected to perform in line with the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy…Read full document

Information Services Group (III) came out with quarterly earnings of $0.1 per share, beating the Zacks Consensus Estimate of $0.09 per share. This compares to earnings of $0.08 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of +11.11%. A quarter ago, it was expected that this market advisory service company would post earnings of $0.08 per share when it actually produced earnings of $0.09, delivering a surprise of +12.5%. Over the last four quarters, the company has surpassed consensus EPS estimates three times. ISG, which belongs to the Zacks Consulting Services industry, posted revenues of $65.49 million for the quarter ended June 2026, surpassing the Zacks Consensus Estimate by 4.36%. This compares to year-ago revenues of $61.56 million. The company has topped consensus revenue estimates four times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. ISG shares have lost about 24.2% since the beginning of the year versus the S&P 500's gain of 13%. While ISG has underperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for ISG was mixed. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the shares are expected to perform in line with the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $0.10 on $63.88 million in revenues for the coming quarter and $0.37 on $251.73 million in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Consulting Services is currently in the top 32% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. CRA International (CRAI), another stock in the same industry, has yet to report results for the quarter ended June 2026. The results are expected to be released on August 6. This consulting firm is expected to post quarterly earnings of $2.12 per share in its upcoming report, which represents a year-over-year change of +12.8%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. CRA International's revenues are expected to be $198.35 million, up 6.1% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Information Services Group, Inc. (III) : Free Stock Analysis Report Charles River Associates (CRAI) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

TranscriptFY2026 Q22026-08-06

FY2026 Q2 earnings call transcript

Earnings source - 85 paragraphs
Operator

Good morning, and welcome everyone to the Information Services Group second quarter 2026 conference call. This call is being recorded, and a replay will be available on ISG's website within 24 hours. Now I'd like to turn the call over to Mr. Will Thorndike for opening remarks and introductions. Mr. Thorndike, please go ahead.

Will Thorndike

Thank you, operator. Hello, good morning. My name is Will Thorndike. I am head of corporate communications for ISG. I'd like to welcome everyone to ISG's second quarter conference call. I'm joined today by Michael Connors, Chairman and Chief Executive Officer, and Michael Sherrick, Executive Vice President and Chief Financial Officer. Before we begin, I would like to read a forward-looking statement. It is important to note that this communication may contain forward-looking statements, which represent the current expectations and beliefs of the management of ISG concerning future events and their potential effects. These statements are not guarantees of future results and are subject to certain risks and uncertainties that could cause actual results to differ materially from those anticipated.

Will Thorndike

For a more detailed listing of the risks and other factors that could affect future results, please refer to the forward-looking statement contained in our Form 8-K that was furnished last night to the SEC and the Risk Factor section of our most recent Form 10-K and 10-Q filings. You should also read ISG's annual report on Form 10-K and any other relevant documents, including any amendments or supplements to these documents filed with the SEC. You will be able to obtain free copies of any of ISG's SEC filings on either ISG's website at www.isg-one.com or the SEC's website at www.sec.gov. ISG undertakes no obligation to update or revise any forward-looking statements to reflect subsequent events or circumstances.

Will Thorndike

During this call, we will discuss certain non-GAAP financial measures, which ISG believes improves the comparability of the company's financial results between periods and provides for greater transparency of key measures used to evaluate the company's performance. The non-GAAP measures, which we will touch on today include adjusted EBITDA, adjusted net earnings, and the presentation of selected financial data on a constant currency basis. Non-GAAP measures are provided as additional information and should not be considered in isolation or as a substitute for financial results prepared in accordance with GAAP. For the reconciliation of all non-GAAP measures presented to the most closely applicable GAAP measure, please refer to our current report on Form 8-K, which was filed last night with the SEC. Now I would like to turn the call over to Michael Connors, who will be followed by Michael Sherrick. Mike?

Michael Connors

Thank you, Will, and good morning, everyone. Today, we will discuss our strong Q2 results, how AI is creating new opportunities across our business, the expansion of our share buyback program, and our outlook for Q3. ISG had a strong second quarter and an excellent first half. Our Q2 results, both revenue and EBITDA, were above our expectations. The underpinning of our success is how closely aligned our strategy is with the priorities of today's enterprise leaders. Organizations continue to focus on improving performance, reducing costs, modernizing operations, and adopting AI responsibly. ISG is uniquely positioned at the intersection of these priorities, and that's demonstrated by our broad-based growth, increasing recurring revenue, expanding margins, larger longer-term engagements, and deeper relationships with our clients. Our revenue was $65.5 million, up more than 6%, led by 10% growth in Europe and 7% growth in the Americas.

Michael Connors

Equally important this quarter, we reached another record in recurring revenues, $30 million, up 7%, powered by our research and governance businesses. In terms of profits, Q2 marks the seventh quarter in a row our adjusted EBITDA has grown by double digits. For the latest quarter, it was up 13% to $9.4 million, while our adjusted EBITDA margin rose more than 80 basis points to 14.3%. Both revenue and EBITDA this quarter were our best results since 2023. In addition to disciplined cost management, our expanding margins reflect the continued evolution of our business toward higher-value advisory work, growth in recurring revenues, and increasing leverage from AI-enabled delivery. AI is a tailwind for ISG, and we are taking advantage of it, reshaping our business as an AI-centered technology research and advisory firm to drive stronger client demand and improve how we deliver our own services.

Michael Connors

In the second quarter, our AI-related revenue grew 64% to $26 million, with growth spread across our AI advisory, research, and governance. For the first half, AI revenue increased to $47 million and represented 37% of firm-wide revenue. For ISG, AI is not an aspiration. It is delivering results right now. Our AI revenues reflect more than growing interest in AI. They show how enterprises are increasingly turning to ISG to solve their most important business challenges, making better technology decisions, improving performance, reducing costs, modernizing systems, and managing increasingly complex environments. AI has become an integral part of each of those conversations. Nearly half of our clients generated AI-related revenue during the quarter. Growth was broad-based across industries, led by consumer, health sciences, and manufacturing.

Michael Connors

What is particularly encouraging is that AI is increasingly embedded across our research, sourcing, governance, and advisory engagements, creating larger opportunities and expanded client relationships over time. The reason this momentum is sustainable is that it reflects broader changes in enterprise priorities, not simply growing interest in AI. According to ISG research on companies globally, the top three client needs today around technology are, one, cost optimization, two, business transformation, and three, vendor and contract optimization. These priorities align exceptionally well with ISG's capabilities. Our integrated platform combines advisory services, proprietary research, and governance expertise to help clients move from strategy to execution, and increasingly, to AI-enabled business transformation. That combination is difficult to replicate and is one of the reasons we're seeing stronger growth, improving margins, and deeper client relationships.

Michael Connors

It's also a reason why we were able to increase our share buyback program by an additional $30 million, part of a disciplined capital allocation strategy that includes reinvesting in our business, returning capital to shareholders via dividends and share repurchases, and supplementing our organic growth with strategic acquisitions to drive long-term shareholder value. Expect an acceleration in buybacks during the second half. Turning to our regions. The Americas delivered $42 million of revenue in Q2, up 7% from last year and up 6% sequentially from the first quarter. The region saw double-digit growth in research and governance and in our health sciences and insurance industry verticals. Key client engagements during the second quarter included 3M, Suntory, and the Commonwealth of Pennsylvania. During the quarter, we continued to expand our relationship with a major global oil and gas company, adding $1 million of revenue to an already multimillion-dollar account.

Michael Connors

Beginning a few years ago with a benchmarking engagement, we have become a strategic partner for this client, supporting their enterprise-wide technology transformation. Our work includes revamping their service agreements and provider ecosystems and realizing greater savings through AI initiatives, including AIOps. Our latest engagement, a major application sourcing program, is expected to save this client more than $100 million. In the quarter, we won a major new engagement with a U.S.-based global manufacturer of heating, cooling, and refrigeration solutions. This million-dollar engagement, won through our private equity channel to support portfolio companies, will transform this client's technology supplier landscape, modernize their network, and strengthen provider governance. This is opening the door to a broader relationship involving the use of AI to optimize customer experience and generate further operating efficiencies.

Michael Connors

Our Europe region continued its momentum from the second half of 2025 and first quarter of 2026 with an excellent second quarter. Revenues were up 10% to $18 million, driven by double-digit growth in our advisory software and governance businesses and our consumer, banking, manufacturing, and health sciences industry verticals. Key client engagements in Europe in the second quarter included Roche, Olympus, and BNP Paribas. During the quarter, we continued to expand our relationship with a leading health insurer. We began by supporting a $1 billion sourcing program for the client's workplace and core tech services, driving cost savings for them up to 50%. We've since added transition, network security, and now governance, and are in discussions to add change management and software advisory, all leading to a growing multimillion-dollar relationship with this client.

Michael Connors

We also won new business with a leading health and pharmacy chain by leveraging existing relationships with senior management, which asked ISG to advise them on a struggling technology services contract. Based on our strategy recommendations, we were able to reset the agreement and achieve $10 million of savings this year, while significantly improving the client's sourcing model. Based on that success, we are jointly exploring other opportunities, including AI-driven process improvements to help them unlock further value. In Asia Pacific, our Q2 revenues of $5.1 million were down $400,000 compared with the prior year. We saw double-digit growth in our health sciences, energy, and utility verticals. In addition, and importantly, we saw a breakthrough in public sector spending late in the quarter, and based on this trend, we expect this region to return to growth during the back half of this year.

Michael Connors

Key clients in the quarter included Woolworths, data center company AirTrunk, and the Australian Department of Home Affairs. During the quarter, we won a significant agreement in the public sector to provide sourcing support to a government entity in Australia. Our successful negotiations with the government's telecom providers will provide net savings of more than $12 million, greatly exceeding the client's expectations. This is leading to additional engagements to design and support AI-led future workplace services and optimize the client's other existing tech services. Turning to the broader market and our guidance for Q3. Though clients remain measured in their pace of spending, they continue to focus their investments on cost optimization, business transformation, and AI adoption. As I mentioned earlier, this plays to ISG's strengths.

Michael Connors

Keeping in mind the summer months in Europe for the third quarter, we are targeting revenues of between $63.5 million and $64.5 million and adjusted EBITDA between $8.5 million and $9.5 million, which will continue our year-over-year growth and margin expansion. Let me turn the call over to Michael Sherrick, who will summarize our financial results. Michael?

Michael Sherrick

Thank you, Mike. Good morning, everyone. Revenue for the second quarter was $65.5 million, up a solid 6.4% year-over-year, including a $700,000 positive impact from FX. By region, Americas revenue reached $42.1 million, up 6.7%. Europe delivered revenue of $18.3 million, up 9.8%, and Asia Pacific was $5.1 million, down 6.7%. Adjusted EBITDA for the quarter climbed to $9.4 million, up 12.9% year-over-year. Adjusted EBITDA margin expanded 80 basis points to 14.3%. Operating income was $5.9 million, up 25.6% year-over-year, resulting in an operating margin of 8.9%. I would note that our operating margin is at a three-year high, fueled by solid pricing and our continued focus on cost optimization.

Michael Sherrick

GAAP net income was $3.3 million or $0.07 per fully diluted share, compared with $2.2 million or $0.04 per fully diluted share last year. Adjusted net income was $5 million or $0.10 per fully diluted share, up from $4.1 million or $0.08 per fully diluted share a year ago. Headcount at quarter end was 1,281, essentially flat with last quarter, while our consulting utilization remained solid at 74%. We ended the quarter with cash of $23.7 million, compared with $22.7 million at the end of the first quarter. For the quarter, net cash generated from operations was $5.2 million as compared to a $700,000 cash usage in the first quarter. We continue to expect strong operating cash flow for the remainder of the year.

Michael Sherrick

This week, our board of directors approved a new share repurchase authorization of $30 million, the largest such program in our history. The new share repurchase program will take effect upon completion of the firm's current program, which has approximately $2.3 million remaining as of June 30th, 2026. During the quarter, we paid dividends of $2.3 million and repurchased $1.5 million of stock. Our next quarterly dividend will be paid September 25th to shareholders of record as of September 4th. At quarter end, fully diluted shares outstanding were 49.8 million, and our gross debt to EBITDA ratio was 1.7 times, down from 1.9 times at December 31, 2025. Our average borrowing rate for the quarter was 5.3%, down 81 basis points year-over-year.

Michael Sherrick

Overall, our balance sheet remains solid, providing us with a strong foundation to both operate and invest in the business. Mike will now share concluding remarks before we go to Q&A. Mike?

Michael Connors

Thank you, Michael. To summarize, we delivered a strong second quarter and first half. Both our best since 2023, with a broad-based growth across regions, service lines, and industries. We expect continued strength in the second half. We continue to improve the quality of our business with record recurring revenue, expanding margins, and deeper client relationships. Our strong performance and balance sheet allowed us to expand our share repurchase program by an additional $30 million. AI remains an important growth engine. Our overall success is driven by a diversified portfolio that helps clients improve business performance. Our strategy is delivering results today and positions ISG for continued profitable growth as enterprises accelerate their transformation. As always, we are focused on creating shareholder value for the long term, and we are steadfast in our mission to deliver operational excellence and ROI to our clients.

Michael Connors

Thank you very much for calling in this morning, and now let me turn the session over to the operator for your questions.

Operator

Thank you. Today's question and answer session will be conducted electronically. If you'd like to ask a question, you can do so by pressing star and one on your telephone keypad. If you find that your question has been answered and you would like to remove yourself from the queue, you may do so by pressing star one again. Again, if you'd like to ask a question, you can do so by pressing star and one on your touch-tone phone. We'll pause for a moment to allow any questions into the queue. Our first question comes from Joe Gomes from Noble Capital Markets. Please go ahead. Your line is open.

Jacob Mutchler

Thank you. Hi, it's Jacob Mutchler on for Joe Gomes this morning. First question, could you just provide any color on what you're seeing in terms of just total enterprise technology spend with your clients and just, across the industry in general? If you could just compare today with three to six months ago.

Michael Connors

Yes. Good morning. Thank you for the questions. Well, look, what we are seeing is, first of all, there is a shift in the spending of the total budgets around technology. The shift, of course, is trying to move things from the, I'll call it the normal day-to-day or run operations into growth initiatives and especially AI to help them run their business more effectively. AI is clearly a structural growth theme, for sure. The economics around it, I think, are pretty uneven, depending on which business, which industry that you're talking about. Certainly, infrastructure and software are compounding, and labor-based work in these enterprises are facing a lot of pressure, if you will, around improving productivity around them. We see spending accelerating, certainly in AI, to be able to get AI beginning to scale their AI, in these enterprises.

Michael Connors

It is still very early innings, but the spending is there, but it is shifting. The pace in which they're making their decisions, if I think about it to your question of three to six months ago, is not much different than it was three to six months ago. It is still a measured response, but the important factor here is they are making decisions, unlike what I would characterize back in 2024 or early 2025. The money is there, the spending is there, the pace is measured, but decisioning is happening now much more so than a year ago. I hope I answered that question, Jacob.

Jacob Mutchler

Yeah, absolutely. That addressed one of my other questions about the decision-making process, if that has sped up. Thank you for addressing that. My next question is just in regards to the AI pipeline. Could you talk about what region you're seeing the bulk of that AI business come from? Is it across the board? I know you've mentioned in the past that Europe was behind the U.S. in AI spend. Just curious if we're seeing a little bit of a catch-up here in Europe.

Michael Connors

Yeah. Good question. Definitely the U.S. leads. Europe still trails. I would say the Asia-Pacific region certainly trails that. I would say that in Europe we have seen a pickup, because AI clearly is a competitive weapon as it relates to speed, as it relates to quality, as it relates to productivity. The clientele in Europe sees it, they know it, but there's a lot of geopolitical issues in different parts of the main, I would call it main countries in Europe, call it U.K., France, Germany in particular. It is still behind the U.S., but I think the spending around AI has picked up, but not at the pace of the U.S. yet.

Jacob Mutchler

Got you. Thank you for taking my questions today, and congratulations on a solid quarter.

Michael Connors

Thanks very much.

Operator

Our next question comes from Vincent Colicchio from Barrington Research. Please go ahead. Your line is open.

Vincent Colicchio

Good morning, Mike.

Michael Connors

Morning, Vince.

Vincent Colicchio

I'm curious, how does your visibility compare today to, say, six to twelve months ago?

Michael Connors

Yeah, I mean, look, I think the visibility is, I would call it roughly the same, Vince. I wouldn't call it greatly improved. There's no deterioration in it. It's primarily, again, around the pacing of decisions. The good news is that our pipeline is strong. We know those decisions are going to be made. The pace in which is a little unknown. It looks pretty good. We have some very good momentum. We have some very large engagements. Our research and our governance, especially around AI governance, is really resonating with clients. It looks good but we're cautious with all of the geopolitical and other things that are going on in terms of their pace of decisioning. We're confident that decisions are being made and will be made.

Michael Connors

It just may be at a pace that we'd prefer a little faster, but it is there and we like that. I would say we're optimistic about it.

Vincent Colicchio

Are there any large deals in your pipeline that could significantly benefit your trajectory of growth?

Michael Connors

Well, we do have a number of large ones. I can't tell you whether they come to fruition or not. If the pace happens, and it happens sooner, then we'll have a little bit of a nice jolt. I can't really project it per se, Vince, but we do have a number of large engagements that we are pursuing.

Vincent Colicchio

How should we think about the economics of your consulting business? Clients know that AI is reducing consulting costs. Is there any pressure or talk on billing rate relief? I know that sounds contrary to what you're likely seeing right now.

Michael Sherrick

Hey, Vince, it's Michael. I think it's a good question. I think that for us, it's about the value provided, right? We're not seeing that pressure in terms of billing rates. I think that, again, for us, it's about number of transactions, and processing transactions. The expectation as you look forward from our perspective is that AI is driving a more rapid acceleration in people's review of their existing programs, contracts, et cetera, and that'll drive transactions, and that's good for us. We continue to see this as Mike has said, as a tailwind, and a benefit from where we sit.

Vincent Colicchio

Thanks for all that color.

Michael Connors

Thanks, Vince.

Operator

Our next question comes from Dave Storms from Stonegate Capital Partners. Please go ahead. Your line is open.

Maximus Alexander-Nino

Hello. Good morning. This is Maximus. I will be asking questions for Dave this morning.

Michael Connors

Morning.

Maximus Alexander-Nino

Good morning. To start off, recurring revenues definitely seem to stabilize this quarter. Curious to hear, would you assume this is a pretty fair run rate moving forward, or if there are any goals on growing this?

Michael Connors

Yeah. On the recurring revenue, recurring revenues were strong. We had our largest absolute number in any quarter at $30 million in the quarter. It clearly is a priority for us. It is expanding. It is driven by both our research, which is focused around clearly technology, the trends, AI, as you might imagine, and our governance services businesses, which includes AI governance. That grew at a faster rate than the overall firm, and we would expect recurring revenues to continue to grow. Our objective is to get to over 50% of our revenue to be recurring. Just to remind you, five years ago, it was half of that. We are approaching that now at around 45%, 47%. That is a continued focus, and we expect that to continue to grow for the next couple of years.

Maximus Alexander-Nino

Got it. Great. Thank you. That's great color. In the past few quarters, you guys had mentioned that the AI Maturity Index was more of like a door opener.

Michael Connors

Yeah.

Maximus Alexander-Nino

I'm curious to hear more about what typically the next service is clients would tend to purchase or contract out and how long that conversion usually takes place.

Michael Connors

Yeah. We are using the ISG AI Index, if you will, as top of the funnel. It helps. It's part of the conversation. It's part of our proposal management, if you will. You can see that with our AI-related revenues. Our AI-related revenues were $26 million in the quarter. It's significant. It was up, whatever it was, 30-some-odd percent for the quarter year-over-year. We're using a number of tools at the, if you will, the front end of our discussions. Frankly, it is a hot topic, it allows us in. We use the tools to help show them around workforce readiness, how the leaders and teams absorb AI into real work. It's one thing to develop AI capabilities. It's another to have the workforce engage and embrace. We focus on workforce readiness with them.

Michael Connors

We focus on AI economics, how can they turn productivity into credible business economics for their business. Then we talk about governance. How do you AI govern, if you will? How do you govern AI safely and visibly and at scale? By using those as our openers, if you will, it is driving our AI-related revenue, and you can see that with the robustness that we had in this quarter and really in the first half of the year, Dave.

Maximus Alexander-Nino

Great. Thank you. Congratulations on the quarter. That's all that I have for today.

Michael Connors

Okay. Thanks so much, Maximus Alexander-Nino.

Operator

Our next question comes from Gowshihan Sriharan from Singular Research. Please go ahead. Your line is open.

Gowshihan Sriharan

Good morning, gentlemen. Can you hear me?

Michael Connors

Yes. Good morning, Gowshihan.

Gowshihan Sriharan

Good morning. Just following up on that AI governance work, as you were saying, is that genuinely new demand, or are you winning that from competitors or internal teams, or has that changed in a couple of quarters? As you progress it, will it change the mix of the top 10 logos or the client base that you traditionally had?

Michael Connors

The AI component of the governance is new. It's incremental. Every business is thinking about it, talking about it. I sit on a very large corporate board. It's a discussion at the board level. Everybody wants to understand how are we going to govern, how does this runaway train, whether it's the economics around tokens, whether it's the way that we use AI in a constructive and safe way in different enterprises. We see this as new white space for our firm. It gives us an opportunity to expand with our current client base as well as with new prospects. I don't know that it changes what our top 10 looks like by itself, but we do think it adds to revenue for our top clients as well. I hope that answers that, Gowshihan.

Gowshihan Sriharan

Yes. Perfect. Thank you. Thank you for that, Colin. Now Martino has been in the mix for about a year now. How much of that growth is Martino, and is it tracking kind of the early earn-out targets you underwrote?

Michael Connors

Yeah. First of all, it is not material at all. It is performing well. Italy, the whole south region, all of Europe, as you can see, that was up 10% on the year. They've had a strong first half of the year, driven by, if you will, a little more demand opening up in that European theater, as someone else asked a question about Europe. We do see that opening up a bit more than it did a year ago or even six months ago. All of these are contributing factors to it, Gowshihan, but I wouldn't look at that as any materiality in the quarter.

Gowshihan Sriharan

If you strip out the FX and Martino, is the underlying growth rate accelerating or is it still running on kind of low single, kind of the organic growth disaggregation? Can you give us a color on that?

Michael Connors

Yeah. I think about it as mid-single digits.

Gowshihan Sriharan

Okay. On the gross margin side, I guess adjusting for the receivable write-offs, we're looking at gross margins kind of taper, flat, plateau being on its course, or was there something specific about this quarter?

Michael Sherrick

I think your-

Gowshihan Sriharan

-thinking about gross margin.

Michael Sherrick

Yeah, Sorry, you were breaking up. I think your question is the overall gross margin. No, I don't think there's anything specific or different in the quarter. Some of our margin is mixed, right, in terms of the different offerings and services that we have, FDU, et cetera. I wouldn't read anything into it in the quarter. As I said in, I think, an earlier question that we got, we continue to have a very strong value proposition. As long as you continue to have that strong value proposition and can demonstrate value to the clients, then you have an ability to price, and that has not changed for us.

Gowshihan Sriharan

Awesome. Thank you, guys. Congratulations. I'll take it offline. Thank you.

Michael Connors

Thanks, Gowshihan.

Operator

Our last question comes from Marc Riddick from Sidoti. Please go ahead. Your line is open.

Marc Riddick

Hey, good morning.

Michael Connors

Good morning, Marc.

Marc Riddick

It's certainly encouraging to see the progress that you've been making here. I was wondering if you could talk a little bit about the visibility that you have currently relative to maybe a year or so ago, particularly given the strength of recurring revenues and the shift that you were discussing as far as sort of maybe a little less from a defensive to an offensive stance. How do you think that sort of plays into sort of revenue and project visibility?

Michael Connors

Well, first, Marc, I think overall the pipeline is probably as strong as it's ever been. We have clearly visibility in building pipe, and we use pipe, and we rebuild pipe. I think the recurring revenue clearly gives us visibility because that's now representing almost 50% of our business. We know that our collection of 900 clients, that we get 85% of our revenue from that client base every year, and that's kind of been 80-85 for more than a decade. That gives us some visibility in terms of who. I would say that there's really no change on visibility in terms of amounts. You don't really have the visibility to know for sure whether clients A, B, and C are going to be spending X or Y during a given quarter. We are engaged with them.

Michael Connors

We do our best, if you will, to try to provide the best guidance on what we think closes and gets recognized in any given quarter. I would say because the demand environment is good, because that we are focused on, I think, the most important things that clients are thinking about today around cost optimization, around AI adoption, and how you can scale it all fits into our portfolio of services. We have it for those that are moving at a fast pace. We have it for those that are moving slower. We are working with industries that are being disrupted, like healthcare and energy. They love our kind of portfolio of services that can help them. The healthcare industry is being turned upside down. It is our highest growing industry at the moment. Energy is not that far behind.

Michael Connors

Think about all the data centers and what is happening around that area. Utilities also. We have disruption going on in a number of industries, which gives us, if you will, insight into where we think the work and the acceleration might happen over the course of the next several quarters. That's how we think about it, Marc.

Marc Riddick

Great. I wanted to shift gears to cash usage prioritization. Certainly encouraging to see the expansion of the authorization. I was wondering if you could share any thoughts, views as to the potential for acquisitions, maybe availability, valuations. What are you seeing out there? Is there anything that you think that appetite for either adding services or any particular fits that might make sense for you?

Michael Connors

Marc, we are, as you know, acquisitive. We are in the market. We are looking at capabilities that we could add to accelerate growth. We are focused around, if you will, all things digital and AI and things that we could use our channels, our distribution channels into the C-suite, that we could sell more opportunities into them and help them solve more business problems. I would say that based on what we are seeing in the market, that the value expectations are beginning to rise more so than they were a year ago. We keep an eye on that. I would call it a little bit more frothy than it was maybe if you were to ask this question a year ago. Yes, we are active.

Michael Connors

We are in the market, we also are seeing a little bit of an uptick, if you will, on expectation levels on the sell side.

Marc Riddick

Got you. That makes sense. Well, just last thing for me, I guess. The regional commentary is certainly appreciated. I was wondering if you could maybe talk a little bit about if you're seeing differentiation of catalysts in Europe, particularly Europe versus the Americas right now. Where I'm going with this is, we've certainly seen a lot of M&A lately. I was sort of curious as to maybe some of the catalysts and drivers, if you're seeing much differentiation regionally.

Michael Connors

Yeah. It's a good question. Well, specifically in Europe, I think consumer, pharma, and M&A are all very active right now. More so than they were six, nine months ago. What that does, clearly consumer is more on the cost optimization side, but also using AI to assist with that. Pharma is not too far behind that. We see a lot of overall in the health sciences area, different than the payer and provider community in the U.S., so it's a little different. The pharmaceutical companies in particular are very active. We are seeing M&A picking up in the region. That means both on a diligence standpoint and on a portfolio, I'll call it cleanup, to prepare them for a sale has increased. Those are three, if you will, drivers that we have been seeing over in Europe.

Michael Connors

That's a little bit different than maybe here in the U.S., where we see the healthcare side, the energy side, the utility side being bigger drivers than maybe what we see in Europe at the moment.

Marc Riddick

That makes sense. Thank you so much, Mike.

Michael Connors

Yep. Thanks, Marc.

Operator

I'm showing no further questions. I'll turn the call back to Michael Connors for his closing remarks.

Michael Connors

Well, look, in closing, ISG is winning because enterprise clients are prioritizing performance, not just technology. AI is accelerating that trend, with our success built on a diversified platform of advisory, research, and governance capabilities that solve the business problem clients care about most. None of this is possible, of course, without the dedication of our professionals worldwide, and I want to thank them for their contributions to our success. Our people are passionate about helping our clients solve their most important business challenges. That commitment to client success continues to strengthen our business and deepen our relationships and creates long-term value for you, our shareholders. Thanks to all of you for joining us on the call, for your continued support and confidence in our firm. Have a great rest of the day.

Operator

This concludes today's teleconference. You may disconnect at any time.

Investor releaseQuarter not tagged2026-08-05

Information Services Group Announces Second-Quarter 2026 Results

Business Wire
Reports second-quarter GAAP revenues of $65.5 million, up 6.4% versus prior year, exceeding guidance Reports second-quarter GAAP net income of $3.3 million, up 51%; GAAP EPS of $0.07, up 75%, and adjusted EPS of $0.10, up 25%, all versus prior year Reports second-quarter adjusted EBITDA of $9.4 million, up 13% versus prior year, exceeding guidance Announces $30 million expansion of share repurchase program Declares third-quarter dividend of $0.045 per share, payable September 25, 2026, to shareholders of record as of September 4, 2026 Sets third-quarter guidance: revenues between $63.5 million and $64.5 million and adjusted EBITDA between $8.5 million and $9.5 million STAMFORD, Conn., August 05, 2026--(BUSINESS WIRE)--Information Services Group (ISG) (Nasdaq: III), a global AI-centered technology research and advisory firm, today announced financial results for the second quarter ended June 30, 2026. "ISG had a very strong second quarter, generating our highest quarterly revenue since 2023," said Michael P. Connors, chairman and CEO. "We delivered Q2 revenue of $65.5 million, up more than 6 percent; adjusted EBITDA of $9.4 million, up 13 percent, and an adjusted EBITDA margin of 14.3 percent, up more than 80 basis points from the prior year. Our growth this quarter was led by Europe, up 10 percent, and the Americas, up 7 percent, while our recurring revenues reached a new quarterly high of $30 million, driven by our AI-centered research and governance services. This completes an excellent first half for our firm." Connors noted that the firm’s performance is enabling it to accelerate returns to shareholders. "Given our strong results," Connors said, "our Board of Directors has authorized an additional $30 million in share repurchases, the single largest expansion of our share buyback program in our history." Second-Quarter 2026 Results Reported revenues for the second quarter were $65.5 million, up 6.4 percent from $61.6 million in the prior year. Revenues were $42.1 million in the Americas, up 7 percent on a reported basis. Revenues in Europe were $18.3 million, up 10 percent on a reported basis, and Asia Pacific revenues were $5.1 million, down 7 percent on a reported basis, all versus the prior year. ISG reported second-quarter operating income of $5.9 million, compared with operating income of $4.7 million in the prior year. Reported second-quarter net i…Read full document

Reports second-quarter GAAP revenues of $65.5 million, up 6.4% versus prior year, exceeding guidance Reports second-quarter GAAP net income of $3.3 million, up 51%; GAAP EPS of $0.07, up 75%, and adjusted EPS of $0.10, up 25%, all versus prior year Reports second-quarter adjusted EBITDA of $9.4 million, up 13% versus prior year, exceeding guidance Announces $30 million expansion of share repurchase program Declares third-quarter dividend of $0.045 per share, payable September 25, 2026, to shareholders of record as of September 4, 2026 Sets third-quarter guidance: revenues between $63.5 million and $64.5 million and adjusted EBITDA between $8.5 million and $9.5 million STAMFORD, Conn., August 05, 2026--(BUSINESS WIRE)--Information Services Group (ISG) (Nasdaq: III), a global AI-centered technology research and advisory firm, today announced financial results for the second quarter ended June 30, 2026. "ISG had a very strong second quarter, generating our highest quarterly revenue since 2023," said Michael P. Connors, chairman and CEO. "We delivered Q2 revenue of $65.5 million, up more than 6 percent; adjusted EBITDA of $9.4 million, up 13 percent, and an adjusted EBITDA margin of 14.3 percent, up more than 80 basis points from the prior year. Our growth this quarter was led by Europe, up 10 percent, and the Americas, up 7 percent, while our recurring revenues reached a new quarterly high of $30 million, driven by our AI-centered research and governance services. This completes an excellent first half for our firm." Connors noted that the firm’s performance is enabling it to accelerate returns to shareholders. "Given our strong results," Connors said, "our Board of Directors has authorized an additional $30 million in share repurchases, the single largest expansion of our share buyback program in our history." Second-Quarter 2026 Results Reported revenues for the second quarter were $65.5 million, up 6.4 percent from $61.6 million in the prior year. Revenues were $42.1 million in the Americas, up 7 percent on a reported basis. Revenues in Europe were $18.3 million, up 10 percent on a reported basis, and Asia Pacific revenues were $5.1 million, down 7 percent on a reported basis, all versus the prior year. ISG reported second-quarter operating income of $5.9 million, compared with operating income of $4.7 million in the prior year. Reported second-quarter net income was $3.3 million, compared with net income of $2.2 million in the prior year. Fully diluted earnings per share were $0.07, compared with fully diluted earnings per share of $0.04 in the prior year. Adjusted net income (a non-GAAP measure defined below under "Non-GAAP Financial Measures") for the second quarter was $5.0 million, or $0.10 per share on a fully diluted basis, compared with adjusted net income of $4.1 million, or $0.08 per share on a fully diluted basis, in the prior year’s second quarter. Second-quarter adjusted EBITDA (a non-GAAP measure defined below under "Non-GAAP Financial Measures") was $9.4 million, up 13 percent from the prior year. Adjusted EBITDA margin (a non-GAAP measure calculated by dividing adjusted EBITDA by reported revenues) was 14.3 percent, compared with 13.5 percent in the prior year’s second quarter. Other Financial and Operating Highlights ISG generated cash from operations of $5.2 million in the second quarter, compared with using $0.7 million of cash from operations in the first quarter of 2026. The firm’s cash balance totaled $23.7 million at June 30, 2026, up from $22.7 million at March 31, 2026. During the second quarter, ISG paid dividends of $2.3 million and repurchased $1.5 million of shares. 2026 Third-Quarter Revenue and Adjusted EBITDA Guidance "Our unique mix of AI-centered research, advisory and governance services is proving its value in today’s AI-driven market, while our cost optimization and business transformation services continue to be prized by our clients amid uncertain macro conditions," said Connors. "Considering these ongoing demand characteristics, ISG is targeting third-quarter revenues between $63.5 million and $64.5 million and adjusted EBITDA of between $8.5 million and $9.5 million, which will continue our year-over-year growth. We continuously monitor the macroeconomic environment, including the impact of FX, inflation and other factors, and will adjust our business plans, if needed." Share Repurchase Authorization The ISG Board of Directors approved a new share repurchase authorization of $30 million, increasing to $32.3 million the aggregate available under its share repurchase program. The new share repurchase program will take effect upon completion of the firm’s current program, which has approximately $2.3 million remaining as of June 30, 2026. "ISG remains committed to a disciplined capital allocation strategy that consists of reinvesting in our business, returning capital to shareholders via dividends and share repurchases and supplementing our organic growth with strategic acquisitions to drive long-term shareholder value," said Connors. Quarterly Dividend The ISG Board of Directors declared a third-quarter dividend of $0.045 per share, payable on September 25, 2026, to shareholders of record as of September 4, 2026. Conference Call ISG has scheduled a call for 9 a.m., U.S. Eastern Time, August 6, 2026, to discuss the company’s second-quarter results. The call can be accessed by dialing +1 (800) 715-9871; or, for international callers, by dialing +1 (646) 307-1963. The access code is 2802159. A recording of the conference call will be accessible on ISG’s investor relations page for approximately four weeks following the call. Forward-Looking Statements This communication contains "forward-looking statements" which represent the current expectations and beliefs of management of ISG concerning future events and their potential effects. Statements contained herein including words such as "anticipate," "believe," "contemplate," "plan," "estimate," "target," "expect," "intend," "will," "continue," "should," "may," and other similar expressions, are "forward-looking statements" under the Private Securities Litigation Reform Act of 1995. These forward-looking statements are not guarantees of future results and are subject to certain risks and uncertainties that could cause actual results to differ materially from those anticipated. Those risks relate to inherent business, economic and competitive uncertainties and contingencies relating to the businesses of ISG and its subsidiaries including without limitation: (1) failure to secure new engagements or loss of important clients; (2) ability to hire and retain enough qualified employees to support operations; (3) ability to maintain or increase billing and utilization rates; (4) management of growth; (5) success of expansion internationally; (6) competition; (7) ability to move the product mix into higher margin businesses; (8) general domestic and foreign political and social conditions such as war, political unrest and terrorism; (9) healthcare and benefit cost management; (10) ability to protect ISG and its subsidiaries’ intellectual property or data and the intellectual property or data of others; (11) currency fluctuations and exchange rate adjustments; (12) ability to successfully consummate or integrate strategic acquisitions; (13) outbreaks of diseases, including coronavirus, or similar public health threats or fear of such an event; (14) clients’ termination, delay, or reduction in scope of engagements, or inability to pay; (15) the effect of the divestiture of the automation unit on ISG’s relationships with its customers and suppliers and on its retained business generally; (16) the success of ISG’s focus on AI advisory and AI-powered platforms; (17) changes to trade policy, including new or increased tariffs and changing import/export regulations, and (18) potential employment-related claims. Certain of these and other applicable risks, cautionary statements and factors that could cause actual results to differ from ISG’s forward-looking statements are included in ISG’s filings with the U.S. Securities and Exchange Commission. ISG undertakes no obligation to update or revise any forward-looking statements to reflect subsequent events or circumstances. Non-GAAP Financial Measures ISG reports all financial information required in accordance with U.S. generally accepted accounting principles (GAAP). In this release, ISG has presented both GAAP financial results as well as non-GAAP information for the three and six months ended June 30, 2026, and June 30, 2025. ISG believes that evaluating its ongoing operating results will be enhanced if it discloses certain non-GAAP information. These non-GAAP financial measures exclude non-cash and certain other special charges that many investors believe may obscure the user’s overall understanding of ISG’s current financial performance and ISG’s prospects for the future. ISG believes that these non-GAAP measures provide useful information to investors because they improve the comparability of the financial results between periods and provide for greater transparency of key measures used to evaluate the Company’s performance. ISG provides adjusted EBITDA (defined as net income, plus interest, taxes, depreciation and amortization, foreign currency transaction gains/losses, non-cash stock compensation, interest accretion associated with contingent consideration, acquisition- and disposition-related costs, gains/losses on disposal of assets, and severance, integration and other expense), adjusted net income (defined as net income, plus amortization of intangible assets, non-cash stock compensation, foreign currency transaction gains/losses, interest accretion associated with contingent consideration, acquisition- and disposition-related costs, gains/losses on disposal of assets, and severance, integration and other expense on a tax-adjusted basis), and adjusted net income per diluted share, excluding the net tax effect of certain financial data, which are non-GAAP measures that ISG believes provide useful information to both management and investors by excluding certain expenses and financial implications of foreign currency translations, which management believes are not indicative of ISG’s core operations. These non-GAAP measures are used by ISG to evaluate the Company’s business strategies and management’s performance. We evaluate our results of operations on both an as reported and a constant currency basis. The constant currency presentation, which is a non-GAAP financial measure, excludes the impact of year-over-year fluctuations in foreign currency exchange rates. We believe providing constant currency information provides valuable supplemental information regarding our results of operations, thereby facilitating period-to-period comparisons of our business performance and is consistent with how management evaluates the Company’s performance. We calculate constant currency percentages by converting our current and prior-periods local currency financial results using the same point in time exchange rates and then compare the adjusted current and prior period results. This calculation may differ from similarly titled measures used by others and, accordingly, the constant currency presentation is not meant to be a substitution for recorded amounts presented in conformity with GAAP, nor should such amounts be considered in isolation. Management believes this information facilitates comparison of underlying results over time. Non-GAAP financial measures, when presented, are reconciled to the most closely applicable GAAP measure. Non-GAAP measures are provided as additional information and should not be considered in isolation or as a substitute for results prepared in accordance with GAAP. A reconciliation of the forward-looking non-GAAP estimates contained herein to the corresponding GAAP measures is not being provided, due to the unreasonable efforts required to prepare it. About ISG ISG (Nasdaq: III) is a global AI-centered technology research and advisory firm. A trusted partner to more than 900 clients, including 75 of the world’s top 100 enterprises, ISG is a long-time leader in technology and business services that is now at the forefront of leveraging AI to help organizations achieve operational excellence and faster growth. The firm, founded in 2006, is known for its proprietary market data and research, in-depth knowledge and governance of provider ecosystems, and the expertise of its 1,500 professionals worldwide working together to help clients maximize the value of their technology investments. View source version on businesswire.com: https://www.businesswire.com/news/home/20260805874964/en/ Contacts Press Contact: Will Thoretz+1 203 517 [email protected] Investor Contact: Michael Sherrick+1 203 517 [email protected]

Investor releaseQuarter not tagged2026-08-05

ISG: Q2 Earnings Snapshot

Associated Press

STAMFORD, Conn. (AP) — STAMFORD, Conn. (AP) — Information Services Group Inc. (III) on Wednesday reported second-quarter net income of $3.3 million. The Stamford, Connecticut-based company said it had profit of 7 cents per share. Earnings, adjusted for one-time gains and costs, came to 10 cents per share. The results beat Wall Street expectations. The average estimate of four analysts surveyed by Zacks Investment Research was for earnings of 9 cents per share. The market advisory service company posted revenue of $65.5 million in the period, also exceeding Street forecasts. Four analysts surveyed by Zacks expected $62.8 million. For the current quarter ending in September, ISG said it expects revenue in the range of $63.5 million to $64.5 million. _____ This story was generated by Automated Insights (http://automatedinsights.com/ap) using data from Zacks Investment Research. Access a Zacks stock report on III at https://www.zacks.com/ap/III

Investor releaseQuarter not tagged2026-07-30

Exponent (EXPO) Surpasses Q2 Earnings and Revenue Estimates

Zacks
Exponent (EXPO) came out with quarterly earnings of $0.6 per share, beating the Zacks Consensus Estimate of $0.55 per share. This compares to earnings of $0.52 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of +9.09%. A quarter ago, it was expected that this engineering and scientific consulting company would post earnings of $0.56 per share when it actually produced earnings of $0.59, delivering a surprise of +5.36%. Over the last four quarters, the company has surpassed consensus EPS estimates four times. Exponent, which belongs to the Zacks Consulting Services industry, posted revenues of $148.86 million for the quarter ended June 2026, surpassing the Zacks Consensus Estimate by 3.34%. This compares to year-ago revenues of $132.87 million. The company has topped consensus revenue estimates four times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. Exponent shares have lost about 5.2% since the beginning of the year versus the S&P 500's gain of 6.9%. While Exponent has underperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for Exponent was mixed. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the shares are expected to perform in line with the market in the near future. You can see the complete list of today's Zacks #1…Read full document

Exponent (EXPO) came out with quarterly earnings of $0.6 per share, beating the Zacks Consensus Estimate of $0.55 per share. This compares to earnings of $0.52 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of +9.09%. A quarter ago, it was expected that this engineering and scientific consulting company would post earnings of $0.56 per share when it actually produced earnings of $0.59, delivering a surprise of +5.36%. Over the last four quarters, the company has surpassed consensus EPS estimates four times. Exponent, which belongs to the Zacks Consulting Services industry, posted revenues of $148.86 million for the quarter ended June 2026, surpassing the Zacks Consensus Estimate by 3.34%. This compares to year-ago revenues of $132.87 million. The company has topped consensus revenue estimates four times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. Exponent shares have lost about 5.2% since the beginning of the year versus the S&P 500's gain of 6.9%. While Exponent has underperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for Exponent was mixed. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the shares are expected to perform in line with the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $0.60 on $146.92 million in revenues for the coming quarter and $2.28 on $586.57 million in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Consulting Services is currently in the top 38% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. Another stock from the same industry, Information Services Group (III), has yet to report results for the quarter ended June 2026. The results are expected to be released on August 5. This market advisory service company is expected to post quarterly earnings of $0.09 per share in its upcoming report, which represents a year-over-year change of +12.5%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. Information Services Group's revenues are expected to be $62.75 million, up 1.9% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Exponent, Inc. (EXPO) : Free Stock Analysis Report Information Services Group, Inc. (III) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Investor releaseQuarter not tagged2026-07-07

ISG to Announce Second-Quarter Financial Results

Business Wire

STAMFORD, Conn., July 07, 2026--(BUSINESS WIRE)--Information Services Group (ISG) (Nasdaq: III), a global AI-centered technology research and advisory firm, said today it will release its second-quarter financial results on Wednesday, August 5, 2026, at approximately 4:15 p.m., U.S. Eastern Time. The firm will host a conference call with investors and industry analysts at 9 a.m., U.S. Eastern Time, the following day, Thursday, August 6. Dial-in details are as follows: The dial-in number for U.S. participants is +1 (800) 715-9871. International participants should call +1 (646) 307-1963. The security code to access the call is 2802159. Participants are requested to dial in at least five minutes before the scheduled start time. A recording of the conference call will be accessible on ISG’s investor relations page for approximately four weeks following the call. About ISG ISG (Nasdaq: III) is a global AI-centered technology research and advisory firm. A trusted partner to more than 900 clients, including 75 of the world’s top 100 enterprises, ISG is a long-time leader in technology and business services that is now at the forefront of leveraging AI to help organizations achieve operational excellence and faster growth. The firm, founded in 2006, is known for its proprietary market data and research, in-depth knowledge and governance of provider ecosystems, and the expertise of its 1,500 professionals worldwide working together to help clients maximize the value of their technology investments. View source version on businesswire.com: https://www.businesswire.com/news/home/20260707855916/en/ Contacts Press Contact: Will Thoretz+1 203 517 [email protected] Investor Contact: Michael Sherrick+1 203 517 [email protected]

Investor releaseQuarter not tagged2026-05-08

Information Services Group Q1 Earnings Call Highlights

MarketBeat
Interested in Information Services Group, Inc.? Here are five stocks we like better. Solid Q1 financials: Revenue of $61.2 million was up 3% year‑over‑year and adjusted EBITDA rose 11.8% to $8.3 million, with margins expanding (adjusted EBITDA margin 13.5%, +111 bps) and operating income up 47.7%. AI is a major growth driver: AI‑related revenue reached $21 million (about one‑third of total), up from $12 million a year ago, as pilots move toward deployments and ISG also uses AI internally to boost delivery speed and margins. Large governance win and regional strength: ISG signed its largest deal to date—an up‑to‑$17 million multi‑year governance agreement to manage $300 million in tech spend for a global manufacturer—and Europe revenue jumped 25% to $17.3 million, while Asia Pacific showed signs of pipeline improvement. These 4 Low P/E Tech Stocks Could be Breakout-Ready Bargains Information Services Group (NASDAQ:III) reported first-quarter 2026 results that landed at the top end of its guidance range, driven by strong growth in Europe, expanding profitability, and rising demand tied to artificial intelligence work and cost optimization initiatives. Chairman and CEO Michael Connors said ISG “had a strong 1st quarter and an excellent start to the year, continuing our momentum.” Revenue totaled $61.2 million, up 3% year-over-year, which Connors attributed to “25% growth in Europe and 9% growth in recurring revenues, powered by our research, public sector, and governance businesses.” → Insider Sales: Top AST SpaceMobile Insider Cuts Postion Over 30% Executive Vice President and CFO Michael A. Sherrick provided additional detail by geography. In the Americas, revenue was $39.8 million, down 2.9% year-over-year. Europe revenue rose 25.3% to $17.3 million, while Asia Pacific declined 14.7% to $4.1 million. Profitability improved as well. Sherrick said adjusted EBITDA was $8.3 million, up 11.8%, and adjusted EBITDA margin expanded 111 basis points to 13.5%. Operating income was $5 million, up 47.7%, with operating margin at 8.2%. → Light Speed Returns: Corning Cashes In on NVIDIA Growth On the bottom line, Sherrick reported GAAP net income of $2.7 million, or $0.05 per fully diluted share, compared with $1.5 million, or $0.03 per fully diluted share, in the prior-year period. Adjusted net income was $4.3 million, or $0.09 per fully diluted share, up from $3.7 milli…Read full document

Interested in Information Services Group, Inc.? Here are five stocks we like better. Solid Q1 financials: Revenue of $61.2 million was up 3% year‑over‑year and adjusted EBITDA rose 11.8% to $8.3 million, with margins expanding (adjusted EBITDA margin 13.5%, +111 bps) and operating income up 47.7%. AI is a major growth driver: AI‑related revenue reached $21 million (about one‑third of total), up from $12 million a year ago, as pilots move toward deployments and ISG also uses AI internally to boost delivery speed and margins. Large governance win and regional strength: ISG signed its largest deal to date—an up‑to‑$17 million multi‑year governance agreement to manage $300 million in tech spend for a global manufacturer—and Europe revenue jumped 25% to $17.3 million, while Asia Pacific showed signs of pipeline improvement. These 4 Low P/E Tech Stocks Could be Breakout-Ready Bargains Information Services Group (NASDAQ:III) reported first-quarter 2026 results that landed at the top end of its guidance range, driven by strong growth in Europe, expanding profitability, and rising demand tied to artificial intelligence work and cost optimization initiatives. Chairman and CEO Michael Connors said ISG “had a strong 1st quarter and an excellent start to the year, continuing our momentum.” Revenue totaled $61.2 million, up 3% year-over-year, which Connors attributed to “25% growth in Europe and 9% growth in recurring revenues, powered by our research, public sector, and governance businesses.” → Insider Sales: Top AST SpaceMobile Insider Cuts Postion Over 30% Executive Vice President and CFO Michael A. Sherrick provided additional detail by geography. In the Americas, revenue was $39.8 million, down 2.9% year-over-year. Europe revenue rose 25.3% to $17.3 million, while Asia Pacific declined 14.7% to $4.1 million. Profitability improved as well. Sherrick said adjusted EBITDA was $8.3 million, up 11.8%, and adjusted EBITDA margin expanded 111 basis points to 13.5%. Operating income was $5 million, up 47.7%, with operating margin at 8.2%. → Light Speed Returns: Corning Cashes In on NVIDIA Growth On the bottom line, Sherrick reported GAAP net income of $2.7 million, or $0.05 per fully diluted share, compared with $1.5 million, or $0.03 per fully diluted share, in the prior-year period. Adjusted net income was $4.3 million, or $0.09 per fully diluted share, up from $3.7 million, or $0.07 per fully diluted share, a year earlier. Connors highlighted AI as a key driver in the quarter, saying demand “continues to accelerate.” He said ISG delivered $21 million of AI-related revenue in the first quarter—“about a third” of total company revenue—up from $12 million a year ago. → Years in the Making, AMD’s Upside Movement Has Just Begun Connors described AI-related revenue as including “work where AI is a key part of the client solution,” such as AI research and insights, AI strategy, sourcing governance, operating model design, business case validation, technology provider evaluation, and transformation support. He added that AI and the cost optimization initiatives that fund digital transformation “remain leading areas of client investment.” ISG is also applying AI internally to improve delivery and support margin expansion. Connors said the company is “leveraging AI in our own client delivery model to improve speed, quality, and efficiency, thereby supporting margin expansion over time.” Connors also pointed to the company’s newly launched ISG AI Index, which he said shows early AI spending concentrated in infrastructure as hyperscalers expand capacity, with software and platform providers beginning to monetize AI capabilities and managed services still in early stages. Connors said ISG signed its largest contract to date in the quarter: a multi-year agreement “valued up to $17 million” to provide governance services to a “top global manufacturer.” Under the contract, ISG will manage $300 million in global technology spend across 200 vendors in support of a multi-year AI-powered transformation. Connors said ISG expects to support the client “for up to eight years” and that the work is beginning now. During Q&A, Connors described AI governance as a “hot topic” and said ISG has “a number of discussions going on” and pipeline activity around governance services, with AI governance “at the top of the list.” Asked about contract economics, Sherrick said deals like the large governance agreement typically include two components: an implementation period followed by an ongoing fixed-fee contract. Connors suggested thinking about the arrangement as “roughly $2 million a year,” with contribution beginning “toward the tail end of Q2” and becoming more annualized in Q3. Connors said the Americas delivered $40 million in revenue in Q1, down about 3% year-over-year “against a tough compare” but up 4% sequentially. He said the Americas pipeline is “robust,” and management expects “solid year-over-year growth in Q2.” Connors cited double-digit growth in research and governance and in the health sciences, insurance, and public sector verticals, and referenced client engagements including Estée Lauder, ExxonMobil, and the State of Arizona. In Europe, Connors said the region carried momentum from the second half of last year into Q1, with revenue up 25% to $17 million. He attributed growth to double-digit increases in advisory, software, and governance businesses and strength in consumer, insurance, and health sciences verticals. He cited engagements including Allianz, Diageo, and BARMER, and said ISG won a roughly $1 million engagement with a “welcome-back” client—defined as one that has not worked with ISG in the last 24 months—as well as a $3 million engagement with a new pharmaceutical client. In Asia Pacific, Connors said revenue was $4.1 million, down $700,000 year-over-year, but management expects Q2 revenue to increase about 20% sequentially based on its pipeline, including public sector work. In response to a question about Australia, Connors said the pipeline is “very strong, including the public sector,” and added that “federal spending based on our pipeline, we see picking up,” with improvement expected to show in the second quarter. For the second quarter, Connors said ISG is targeting revenue of $62.5 million to $63.5 million and adjusted EBITDA of $8 million to $9 million. Sherrick told analysts the company was not pointing to any single item affecting the outlook, but cited an “uncertain macro environment” and said the company aims to be conservative given it was “still early in May.” Sherrick said headcount ended the quarter at 1,276, essentially flat with year-end. Consulting utilization was 71.5%, in line with typical first-quarter levels. ISG ended the quarter with $22.7 million in cash, compared with $28.7 million at the end of the fourth quarter. Net cash used in operations was $700,000, which Sherrick said aligned with normal first-quarter seasonality, and he said the company expects strong operating cash flow for the remainder of the year. During the quarter, ISG paid $2.2 million in dividends and repurchased $2.1 million of stock. Sherrick said the next quarterly dividend will be paid June 26 to shareholders of record as of June 5. Fully diluted shares outstanding were 50.2 million, and gross debt-to-EBITDA was just under 1.8x, down from 1.9x at year-end 2025. Sherrick added that the average borrowing rate for the quarter was 5.4%, down 115 basis points year-over-year. In closing remarks, Connors said the company’s AI positioning is already influencing results, stating that AI is “already having a positive impact on our revenue, our margins, governance wins, and client demand.” He also noted ISG recently rang the Nasdaq closing bell to mark its 20th anniversary. Information Services Group, Inc (ISG) is a leading global technology research and advisory firm specializing in digital transformation, sourcing strategies and technology-driven business operations. Headquartered in Stamford, Connecticut, the company leverages deep market insights and data analytics to help clients optimize cost structures, accelerate growth and navigate complex technology landscapes. Since its founding in 2006, ISG has cultivated expertise across industries including financial services, healthcare, manufacturing and the public sector. ISG's core offerings include sourcing advisory, managed governance, market intelligence and research services. The article "Information Services Group Q1 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for May 2026.

Investor releaseQuarter not tagged2026-05-08

Information Services Group Announces First-Quarter 2026 Results

Business Wire
Reports first-quarter GAAP revenues of $61.2 million, up 3% versus prior year, at the top end of guidance Reports first-quarter GAAP net income of $2.7 million, up 83%; GAAP EPS of $0.05, up 83%, and adjusted EPS of $0.09, up 17% Reports first-quarter adjusted EBITDA of $8.3 million, up 12% versus prior year Signs historic multiyear contract valued at up to $17 million to support AI-powered reinvention for top global manufacturer Declares second-quarter dividend of $0.045 per share, payable June 26, 2026, to shareholders of record as of June 5, 2026 Sets second-quarter guidance: revenues between $62.5 million and $63.5 million and adjusted EBITDA between $8.0 million and $9.0 million STAMFORD, Conn., May 07, 2026--(BUSINESS WIRE)--Information Services Group (ISG) (Nasdaq: III), a global AI-centered technology research and advisory firm, today announced financial results for the first quarter ended March 31, 2026. "ISG delivered a strong first quarter, with revenue of $61.2 million, up 3 percent, and adjusted EBITDA of $8.3 million, up 12 percent—both at the top end of guidance—with adjusted EBITDA margins expanding more than 100 basis points from the prior year, to 13.5 percent," said Michael P. Connors, chairman and CEO. "Revenue growth was driven primarily by Europe, up 25 percent, and recurring revenues, up 9 percent, as AI continues to be a tailwind for our firm. "Adding to our recurring revenue acceleration, we signed the largest single client contract in our history—a multiyear agreement valued at up to $17 million to provide governance services for a top global manufacturer," Connors said. "Under this landmark contract, ISG will manage $300 million in global technology spend with 200 technology vendors to support a large-scale, multiyear AI-powered transformation. "This contract and our growing profitability reflect our unique strengths as an AI-centered research and advisory powerhouse that engages strategically with clients, provides deeper insights to shape client solutions and decisions, and, importantly, delivers unmatched execution and AI governance at scale." First-Quarter 2026 Results Reported revenues for the first quarter were $61.2 million, up 3 percent from $59.6 million in the prior year. Revenues were $39.8 million in the Americas, down 3 percent on a reported basis. Revenues in Europe were $17.3 million, up 25 percent on a reported basi…Read full document

Reports first-quarter GAAP revenues of $61.2 million, up 3% versus prior year, at the top end of guidance Reports first-quarter GAAP net income of $2.7 million, up 83%; GAAP EPS of $0.05, up 83%, and adjusted EPS of $0.09, up 17% Reports first-quarter adjusted EBITDA of $8.3 million, up 12% versus prior year Signs historic multiyear contract valued at up to $17 million to support AI-powered reinvention for top global manufacturer Declares second-quarter dividend of $0.045 per share, payable June 26, 2026, to shareholders of record as of June 5, 2026 Sets second-quarter guidance: revenues between $62.5 million and $63.5 million and adjusted EBITDA between $8.0 million and $9.0 million STAMFORD, Conn., May 07, 2026--(BUSINESS WIRE)--Information Services Group (ISG) (Nasdaq: III), a global AI-centered technology research and advisory firm, today announced financial results for the first quarter ended March 31, 2026. "ISG delivered a strong first quarter, with revenue of $61.2 million, up 3 percent, and adjusted EBITDA of $8.3 million, up 12 percent—both at the top end of guidance—with adjusted EBITDA margins expanding more than 100 basis points from the prior year, to 13.5 percent," said Michael P. Connors, chairman and CEO. "Revenue growth was driven primarily by Europe, up 25 percent, and recurring revenues, up 9 percent, as AI continues to be a tailwind for our firm. "Adding to our recurring revenue acceleration, we signed the largest single client contract in our history—a multiyear agreement valued at up to $17 million to provide governance services for a top global manufacturer," Connors said. "Under this landmark contract, ISG will manage $300 million in global technology spend with 200 technology vendors to support a large-scale, multiyear AI-powered transformation. "This contract and our growing profitability reflect our unique strengths as an AI-centered research and advisory powerhouse that engages strategically with clients, provides deeper insights to shape client solutions and decisions, and, importantly, delivers unmatched execution and AI governance at scale." First-Quarter 2026 Results Reported revenues for the first quarter were $61.2 million, up 3 percent from $59.6 million in the prior year. Revenues were $39.8 million in the Americas, down 3 percent on a reported basis. Revenues in Europe were $17.3 million, up 25 percent on a reported basis, and Asia Pacific revenues were $4.1 million, down 15 percent on a reported basis, all versus the prior year. ISG reported first-quarter operating income of $5.0 million, compared with operating income of $3.4 million in the prior year. Reported first-quarter net income was $2.7 million, compared with net income of $1.5 million in the prior year. Fully diluted earnings per share were $0.05, compared with fully diluted earnings per share of $0.03 in the prior year. Adjusted net income (a non-GAAP measure defined below under "Non-GAAP Financial Measures") for the first quarter was $4.3 million, or $0.09 per share on a fully diluted basis, compared with adjusted net income of $3.7 million, or $0.07 per share on a fully diluted basis, in the prior year’s first quarter. First-quarter adjusted EBITDA (a non-GAAP measure defined below under "Non-GAAP Financial Measures") was $8.3 million, up 12 percent from the prior-year first quarter. Adjusted EBITDA margin (a non-GAAP measure calculated by dividing adjusted EBITDA by reported revenues) was 13.5 percent, compared with 12.4 percent in the prior year. Other Financial and Operating Highlights ISG used cash from operations of $0.7 million in the first quarter. The firm’s cash balance totaled $22.7 million at March 31, 2026, up from $20.1 million at March 31, 2025, but down from $28.7 million at December 31, 2025. During the first quarter, ISG paid dividends of $2.2 million and repurchased $2.1 million of shares. 2026 Second-Quarter Revenue and Adjusted EBITDA Guidance "Clients remain somewhat cautious in the face of current macro and geopolitical conditions and as a result are focusing on cost optimization and preparing for enterprise-scale adoption of AI, which play to ISG strengths," said Connors. "We see current demand trends continuing. ISG is targeting revenues between $62.5 million and $63.5 million and adjusted EBITDA of between $8.0 million and $9.0 million, which will continue our year-over-year growth. We will monitor the macroeconomic environment, including the impact of FX, inflation and other factors, and adjust our business plans accordingly." Quarterly Dividend The ISG Board of Directors declared a second-quarter dividend of $0.045 per share, payable on June 26, 2026, to shareholders of record as of June 5, 2026. Conference Call ISG has scheduled a call for 9 a.m., U.S. Eastern Time, May 8, 2026, to discuss the company’s first-quarter results. The call can be accessed by dialing +1 (800) 715-9871; or, for international callers, by dialing +1 (646) 307-1963. The access code is 6855650. A recording of the conference call will be accessible on ISG’s investor relations page for approximately four weeks following the call. Forward-Looking Statements This communication contains "forward-looking statements" which represent the current expectations and beliefs of management of ISG concerning future events and their potential effects. Statements contained herein including words such as "anticipate," "believe," "contemplate," "plan," "estimate," "target," "expect," "intend," "will," "continue," "should," "may," and other similar expressions, are "forward-looking statements" under the Private Securities Litigation Reform Act of 1995. These forward-looking statements are not guarantees of future results and are subject to certain risks and uncertainties that could cause actual results to differ materially from those anticipated. Those risks relate to inherent business, economic and competitive uncertainties and contingencies relating to the businesses of ISG and its subsidiaries including without limitation: (1) failure to secure new engagements or loss of important clients; (2) ability to hire and retain enough qualified employees to support operations; (3) ability to maintain or increase billing and utilization rates; (4) management of growth; (5) success of expansion internationally; (6) competition; (7) ability to move the product mix into higher margin businesses; (8) general political and social conditions such as war, political unrest and terrorism; (9) healthcare and benefit cost management; (10) ability to protect ISG and its subsidiaries’ intellectual property or data and the intellectual property or data of others; (11) currency fluctuations and exchange rate adjustments; (12) ability to successfully consummate or integrate strategic acquisitions; (13) outbreaks of diseases, including coronavirus, or similar public health threats or fear of such an event; (14) clients’ termination, delay, or reduction in scope of engagements; (15) the effect of the divestiture of the automation unit on ISG’s relationships with its customers and suppliers and on its retained business generally; (16) the success of ISG’s focus on AI advisory and AI-powered platforms; (17) changes to trade policy, including new or increased tariffs and changing import/export regulations, and (18) potential employment-related claims. Certain of these and other applicable risks, cautionary statements and factors that could cause actual results to differ from ISG’s forward-looking statements are included in ISG’s filings with the U.S. Securities and Exchange Commission. ISG undertakes no obligation to update or revise any forward-looking statements to reflect subsequent events or circumstances. Non-GAAP Financial Measures ISG reports all financial information required in accordance with U.S. generally accepted accounting principles (GAAP). In this release, ISG has presented both GAAP financial results as well as non-GAAP information for the three months ended March 31, 2026, and March 31, 2025. ISG believes that evaluating its ongoing operating results will be enhanced if it discloses certain non-GAAP information. These non-GAAP financial measures exclude non-cash and certain other special charges that many investors believe may obscure the user’s overall understanding of ISG’s current financial performance and ISG’s prospects for the future. ISG believes that these non-GAAP measures provide useful information to investors because they improve the comparability of the financial results between periods and provide for greater transparency of key measures used to evaluate the Company’s performance. ISG provides adjusted EBITDA (defined as net income, plus interest, taxes, depreciation and amortization, foreign currency transaction gains/losses, non-cash stock compensation, interest accretion associated with contingent consideration, acquisition- and disposition-related costs, gain on disposal of assets, and severance, integration and other expense), adjusted net income (defined as net income, plus amortization of intangible assets, non-cash stock compensation, foreign currency transaction gains/losses, interest accretion associated with contingent consideration, acquisition- and disposition-related costs, gain on disposal of assets, and severance, integration and other expense on a tax-adjusted basis), and adjusted net income per diluted share, excluding the net tax effect of certain financial data, which are non-GAAP measures that ISG believes provide useful information to both management and investors by excluding certain expenses and financial implications of foreign currency translations, which management believes are not indicative of ISG’s core operations. These non-GAAP measures are used by ISG to evaluate the Company’s business strategies and management’s performance. We evaluate our results of operations on both an as reported and a constant currency basis. The constant currency presentation, which is a non-GAAP financial measure, excludes the impact of year-over-year fluctuations in foreign currency exchange rates. We believe providing constant currency information provides valuable supplemental information regarding our results of operations, thereby facilitating period-to-period comparisons of our business performance and is consistent with how management evaluates the Company’s performance. We calculate constant currency percentages by converting our current and prior-periods local currency financial results using the same point in time exchange rates and then compare the adjusted current and prior period results. This calculation may differ from similarly titled measures used by others and, accordingly, the constant currency presentation is not meant to be a substitution for recorded amounts presented in conformity with GAAP, nor should such amounts be considered in isolation. Management believes this information facilitates comparison of underlying results over time. Non-GAAP financial measures, when presented, are reconciled to the most closely applicable GAAP measure. Non-GAAP measures are provided as additional information and should not be considered in isolation or as a substitute for results prepared in accordance with GAAP. A reconciliation of the forward-looking non-GAAP estimates contained herein to the corresponding GAAP measures is not being provided, due to the unreasonable efforts required to prepare it. About ISG ISG (Nasdaq: III) is a global AI-centered technology research and advisory firm. A trusted partner to more than 900 clients, including 75 of the world’s top 100 enterprises, ISG is a long-time leader in technology and business services that is now at the forefront of leveraging AI to help organizations achieve operational excellence and faster growth. The firm, founded in 2006, is known for its proprietary market data and research, in-depth knowledge and governance of provider ecosystems, and the expertise of its 1,500 professionals worldwide working together to help clients maximize the value of their technology investments. View source version on businesswire.com: https://www.businesswire.com/news/home/20260507761175/en/ Contacts Press Contact: Will Thoretz +1 203 517 3119 [email protected] Investor Contact: Michael Sherrick +1 203 517 3104 [email protected]

Investor releaseQuarter not tagged2026-05-08

ISG: Q1 Earnings Snapshot

Associated Press

STAMFORD, Conn. (AP) — STAMFORD, Conn. (AP) — Information Services Group Inc. (III) on Thursday reported first-quarter net income of $2.7 million. On a per-share basis, the Stamford, Connecticut-based company said it had profit of 5 cents. Earnings, adjusted for one-time gains and costs, were 9 cents per share. The results exceeded Wall Street expectations. The average estimate of four analysts surveyed by Zacks Investment Research was for earnings of 8 cents per share. The market advisory service company posted revenue of $61.2 million in the period, also topping Street forecasts. Four analysts surveyed by Zacks expected $60.9 million. For the current quarter ending in June, ISG said it expects revenue in the range of $62.5 million to $63.5 million. _____ This story was generated by Automated Insights (http://automatedinsights.com/ap) using data from Zacks Investment Research. Access a Zacks stock report on III at https://www.zacks.com/ap/III

Investor releaseQuarter not tagged2026-05-08

Information Services Group (III) Beats Q1 Earnings and Revenue Estimates

Zacks
Information Services Group (III) came out with quarterly earnings of $0.09 per share, beating the Zacks Consensus Estimate of $0.08 per share. This compares to earnings of $0.07 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of +16.13%. A quarter ago, it was expected that this market advisory service company would post earnings of $0.08 per share when it actually produced earnings of $0.08, delivering no surprise. Over the last four quarters, the company has surpassed consensus EPS estimates three times. ISG, which belongs to the Zacks Consulting Services industry, posted revenues of $61.18 million for the quarter ended March 2026, surpassing the Zacks Consensus Estimate by 0.51%. This compares to year-ago revenues of $59.58 million. The company has topped consensus revenue estimates four times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. ISG shares have lost about 28.4% since the beginning of the year versus the S&P 500's gain of 7.6%. While ISG has underperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for ISG was favorable. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #2 (Buy) for the stock. So, the shares are expected to outperform the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here…Read full document

Information Services Group (III) came out with quarterly earnings of $0.09 per share, beating the Zacks Consensus Estimate of $0.08 per share. This compares to earnings of $0.07 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of +16.13%. A quarter ago, it was expected that this market advisory service company would post earnings of $0.08 per share when it actually produced earnings of $0.08, delivering no surprise. Over the last four quarters, the company has surpassed consensus EPS estimates three times. ISG, which belongs to the Zacks Consulting Services industry, posted revenues of $61.18 million for the quarter ended March 2026, surpassing the Zacks Consensus Estimate by 0.51%. This compares to year-ago revenues of $59.58 million. The company has topped consensus revenue estimates four times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. ISG shares have lost about 28.4% since the beginning of the year versus the S&P 500's gain of 7.6%. While ISG has underperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for ISG was favorable. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #2 (Buy) for the stock. So, the shares are expected to outperform the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $0.09 on $62.53 million in revenues for the coming quarter and $0.36 on $251.56 million in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Consulting Services is currently in the bottom 37% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. Another stock from the same industry, Booz Allen Hamilton (BAH), has yet to report results for the quarter ended March 2026. The results are expected to be released on May 22. This defense contractor is expected to post quarterly earnings of $1.32 per share in its upcoming report, which represents a year-over-year change of -18%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. Booz Allen Hamilton's revenues are expected to be $2.88 billion, down 3.1% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Information Services Group, Inc. (III) : Free Stock Analysis Report Booz Allen Hamilton Holding Corporation (BAH) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

As of 2026-08-15 • Updated weeklySource: Earnings sourceIngestion runbook