EPAM Systems Surges 9.36% After Q2 Earnings Beat Expectations

EPAM Systems reported Q2 revenue of $1.35bn, up 18.04% YoY, and EPS of $2.77, exceeding expectations. The company raised its full-year revenue growth forecast to 13%-15% and the stock price surged 9.36%. Analysts remain bullish, with JPMorgan maintaining a Buy rating and lowering the price target from $205 to $201.

EPAM Systems, Inc. (EPAM), a leading provider of digital platform engineering and software development services, reported robust second-quarter (Q2) 2025 results, with revenue up 18.04% year-over-year (YoY) to $1.35 billion and non-GAAP earnings per share (EPS) rising 13% to $2.77, surpassing market expectations. The company also raised its full-year revenue growth forecast to 13%-15%, leading to a 9.36% surge in its stock price.

EPAM's strong performance is attributed to increasing client demand for generative AI solutions, which has bolstered the company's ability to withstand end market pressures affecting some industry peers. The company's open-source GenAI platform, DIAL 3.0, has also been a key driver of this growth, reflecting EPAM's commitment to staying ahead in the enterprise AI adoption landscape.

Analysts remain bullish on EPAM's prospects. Among the 17 analysts covering the stock, the consensus is a "Moderate Buy," based on 11 "Strong Buy" ratings, one "Moderate Buy," and five "Holds." JPMorgan, for instance, maintains a "Buy" rating but has lowered its price target from $205 to $201, reflecting the company's expected below-average revenue growth for the third consecutive year, with anticipated improvement ahead.

For fiscal 2025, analysts expect EPAM's EPS to decline 1.7% to $8.72 on a diluted basis. The company's earnings surprise history is impressive, with it beating the consensus estimate in each of the last four quarters.

Despite the positive outlook, investors should remain mindful of potential risks, such as margin pressure from wage inflation and evolving delivery models. However, the company's strong Q2 results and upgraded guidance suggest that EPAM is well-positioned to navigate these challenges and continue its growth trajectory.

References:

[1] https://www.barchart.com/story/news/34447649/epam-systems-stock-analyst-estimates-ratings
[2] https://simplywall.st/stocks/us/software/nyse-epam/epam-systems/news/epam-systems-epam-is-up-109-after-upgrading-2025-growth-outl