Overview
- Fiscal Q2 revenue reached $18.0 billion with diluted EPS of $2.93, new bookings totaled a record $22.1 billion, operating margin was 13.8%, and free cash flow was $3.7 billion.
- Full-year guidance now calls for 3%–5% local-currency revenue growth, GAAP EPS of $13.25–$13.50, and free cash flow of $10.8–$11.5 billion, with an estimated ~1% U.S. federal headwind implying 4%–6% growth excluding that impact.
- Q3 revenue was guided to $18.35 billion–$19.00 billion, with the midpoint slightly below the LSEG consensus of $18.72 billion.
- Shares fell to a 52-week low and several analysts cut price targets after the report, including Baird to $265, Guggenheim to $250, and RBC Capital to $253, even as ratings stayed positive.
- Management highlighted AI momentum with 41 clients booking over $100 million, plans for roughly $5 billion in FY26 M&A to deepen AI capabilities, a managed-services mix of about 51% of revenue, 93% utilization, and $2.7 billion returned to shareholders in Q2.