ISG Q2 Earnings: AI-Driven Growth Amid Regional Challenges

ISG reported Q2 revenues of $62 million, a 7% increase YoY, driven by a 16% increase in the Americas region. AI-related revenue surged to 2.5 times higher than the previous year, accounting for nearly 20% of total revenue. The company acquired Martino & Partners, expanding its presence in the European public sector. Adjusted EBITDA reached $8.3 million, up 17%, and cash generation was nearly $12 million. ISG is aggressively investing in AI, data analytics, and infrastructure modernization, with a focus on the Americas region.

Information Services Group (ISG) (Nasdaq: III) has announced its second-quarter financial results, showcasing robust growth and strategic initiatives. The company reported GAAP revenues of $62 million, a 7% year-over-year (YoY) increase, driven by a 16% increase in the Americas region [1]. AI-related revenue surged to 2.5 times higher than the previous year, accounting for nearly 20% of total revenue [2]. ISG also generated $12 million in cash from operations, a significant improvement from the $2.2 million generated in the prior year.

Adjusted EBITDA for the quarter stood at $8.3 million, marking a 17% YoY increase. The company's cash balance at June 30, 2025, totaled $25.2 million, up 25% from the previous quarter. ISG also paid dividends of $2.4 million and repurchased $4.0 million of shares during the quarter.

A notable strategic move for ISG was the agreement to acquire Martino & Partners, a highly respected strategic advisory firm serving public and private sector clients in Italy. The acquisition aims to expand ISG’s client base, geographic footprint, and capabilities in Italy, a market with emerging growth potential fueled by European Union-funded technology modernization programs and a focus on AI and cost optimization [1].

ISG’s chairman and CEO, Michael P. Connors, stated, “ISG delivered an excellent second quarter, underscoring our momentum as an AI-centered firm with strong, trusted client relationships.” He noted that the Americas business, in particular, contributed significantly to the growth, with revenues up 16% [1].

Looking ahead, ISG has set third-quarter revenue guidance between $60.5 million and $61.5 million, and adjusted EBITDA between $7.5 million and $8.5 million. The company also declared a third-quarter dividend of $0.045 per share, payable on September 26, 2025 [1].

References:
[1] https://www.ainvest.com/news/isg-q2-revs-7-yoy-62mln-q2-ebitda-17-2508/
[2] https://www.investing.com/news/transcripts/earnings-call-transcript-information-services-group-beats-q2-2025-forecasts-93CH-4177948