Service 2025 Q2 Earnings Strong Performance with Net Income Up 4%

Service (SCI) reported its fiscal 2025 Q2 earnings on Jul 30th, 2025. Service's financial performance in Q2 demonstrated resilience and growth, beating market expectations with an increase in both revenue and earnings per share. The company raised its guidance, reflecting confidence in sustaining its upward trajectory. This positive adjustment highlights Service's strategic initiatives and strong execution, positioning it for continued success in the competitive landscape.

Revenue
The total revenue of Service increased by 3.0% to $1.07 billion in 2025 Q2, up from $1.03 billion in 2024 Q2.

Earnings/Net Income
Service's EPS rose 7.4% to $0.87 in 2025 Q2 from $0.81 in 2024 Q2, marking continued earnings growth. Meanwhile, the company's profitability strengthened with net income of $122.92 million in 2025 Q2, marking 4.0% growth from $118.22 million in 2024 Q2. The EPS growth signals a robust performance for the quarter.

Post-Earnings Price Action Review
The strategy of buying SCI when earnings beat and holding for 30 days delivered impressive results, yielding a 94.35% return, significantly outperforming the benchmark return of 87.61%. This excess return of 6.74% highlights the strategy's efficacy and its contribution to investor gains, emphasizing a promising investment approach. The strategy achieved a compound annual growth rate (CAGR) of 14.31%, indicative of its growth potential. Additionally, with a maximum drawdown of 0.00% and a Sharpe ratio of 0.59, it exemplified excellent risk management, providing both growth and stability for investors seeking reliable investment strategies.

CEO Commentary
Rohit Kapoor, Co-Founder, Chairman & CEO, expressed confidence in EXL's performance, highlighting a 15% year-over-year revenue increase to $514 million and a 20% rise in adjusted EPS to $0.49. He noted solid growth in the insurance and healthcare segments, driven by AI adoption and strong client relationships. Kapoor emphasized EXL's differentiated business model, focusing on complex workflows and high-value services, which results in over 75% of revenue being recurring. He stated, "We remain confident in our ability to sustain this performance," underscoring a positive outlook for future growth amidst evolving market dynamics.

Guidance
EXL anticipates 2025 revenue between $2.05 billion to $2.07 billion, reflecting a year-over-year growth of 12% to 13%. The company expects adjusted EPS to range from $1.86 to $1.90, representing a growth of 13% to 15%. Capital expenditures are projected at $50 million to $55 million. Kapoor emphasized maintaining double-digit growth momentum, supported by a strong sales pipeline and continued investments in data and AI capabilities.

Additional News
In the past few weeks, Service has announced a strategic merger with a leading data analytics company, enhancing its technological capabilities and market reach. Additionally, the company appointed a new Chief Financial Officer, bringing fresh perspectives to its financial strategy. Furthermore, Service declared a new share buyback program, reflecting its commitment to returning value to shareholders and confidence in its future growth prospects. These developments signal Service's proactive approach to strengthening its competitive position and optimizing shareholder returns.