What Happened?

Shares of business transformation services company Genpact (NYSE: G) jumped 6.7% in the afternoon session after the company reported fourth-quarter 2025 results that topped Wall Street's expectations for revenue and profit, though its outlook was mixed. 

The business transformation services company posted revenue of $1.32 billion, up 5.6% year over year, and an adjusted profit of $0.97 per share, beating analyst estimates. The company also generated strong free cash flow, with its margin increasing to 20.4% from 14.6% in the same quarter last year. However, Genpact's guidance for the next quarter was varied; its revenue forecast of $1.29 billion came in slightly below consensus, while its adjusted earnings per share guidance of $0.93 was just ahead of expectations. Despite the soft revenue outlook, investors appeared to focus on the strong quarterly performance.

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What Is The Market Telling Us

Genpact’s shares are not very volatile and have only had 5 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business.

The previous big move we wrote about was 3 days ago when the stock dropped 7.5% on the news that disappointing fourth-quarter results from industry bellwether Gartner sparked widespread concerns about a slowdown in the sector. 

The research and advisory firm reported that revenue in its Consulting segment fell 12.8%. This weak performance from a major industry player appeared to validate broader market fears about the health of the IT services and consulting industry. The negative sentiment spread quickly, with shares of other major companies like Accenture and Intuit also falling sharply. The market now seems concerned about a potential slowdown in the sector's growth rate, compounded by uncertainty over the long-term impact of artificial intelligence on existing business models.

Genpact is down 12.5% since the beginning of the year, and at $40.19 per share, it is trading 27.6% below its 52-week high of $55.54 from February 2025. Investors who bought $1,000 worth of Genpact’s shares 5 years ago would now be looking at an investment worth $955.88.

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