Concentrix Corporation — Form 10-Q summary
Reporting period: Third quarter and nine months ended August 31, 2026; comparisons are with the same periods in 2025. Unless stated otherwise, amounts are U.S. dollars. The filing describes Concentrix as a global technology and services provider serving more than 2,000 clients.
Financial performance
| Metric | Three months ended Aug. 31, 2026 | Year over year | Nine months ended Aug. 31, 2026 | Year over year |
|---|---|---|---|---|
| Revenue | $2,453.7 million | Down 1.2% | $7,416.5 million | Up 2.0% |
| Gross profit / margin | $848.9 million / 34.6% | Down 0.7%; margin up from 34.4% | $2,521.9 million / 34.0% | Down 1.5%; margin down from 35.2% |
| GAAP operating income (loss) / margin | $(910.3) million / (37.1)% | Prior year: $147.0 million / 5.9% | $(696.3) million / (9.4)% | Prior year: $464.2 million / 6.4% |
| GAAP net income (loss) | $(988.1) million; diluted EPS $(16.24) | Prior year: $88.1 million; EPS $1.34 | $(911.2) million; diluted EPS $(14.99) | Prior year: $200.5 million; EPS $3.01 |
| Adjusted EBITDA (non-GAAP) / margin | $363.0 million / 14.8% | Prior year: $359.2 million / 14.5% | $1,058.5 million / 14.3% | Down 3.0%; prior-year margin 15.0% |
| Operating cash flow / capital expenditure | Not presented quarterly in this filing | $442.9 million / $149.1 million | Prior-year operating cash flow: $462.7 million | |
| Free cash flow (non-GAAP) | Not presented quarterly in this filing | $293.8 million | Prior year: $291.3 million |
The $1.05 billion goodwill impairment was non-cash and accounted for most of the GAAP operating and net losses. Non-GAAP adjusted EBITDA and non-GAAP operating income exclude impairment and other specified items; they are not substitutes for GAAP results. Nine-month non-GAAP operating income was $896.0 million, compared with $930.3 million a year earlier.
Balance sheet, debt and liquidity
- At August 31, 2026, cash and cash equivalents were $244.7 million; cash including cash held for sale was $255.8 million. Total assets were $9.26 billion and stockholders’ equity was $1.77 billion.
- Total debt carrying value was approximately $4.38 billion, including $450 million classified as current and $3.93 billion of long-term debt, net. The current term-loan portion matures December 27, 2026. The company reported $1.82 billion of outstanding term-loan principal and $620.5 million outstanding under its receivables securitization facility. No revolving-credit-facility borrowings were outstanding.
- Reported total liquidity was $1.49 billion, including $1.10 billion of undrawn revolver capacity, $129.5 million of undrawn securitization capacity and cash, including cash held for sale. The company said it expects available cash, operating cash flows and liquidity sources to meet working-capital and investment needs for the next 12 months.
- Net cash used in financing activities was $383.3 million for the nine months, including debt repayments, $69.3 million of dividends and $43.2 million of share repurchases. The company paid a $0.36-per-share quarterly dividend and announced a $0.37 dividend for November 2026.
Material changes and management commentary
- Revenue trends varied by industry. Nine-month growth in banking, financial services and insurance (13.5%) and retail, travel and e-commerce (9.1%) was offset in part by declines in technology and consumer electronics (6.4%) and healthcare (11.9%). In the quarter, revenue declined in technology, communications and healthcare, while banking and retail grew.
- Management attributed pressure on nine-month gross margin primarily to restructuring-related severance and employee costs, wage increases in certain countries and business mix; favorable foreign exchange effects partly offset the pressure. Cost-reduction initiatives affected approximately 30,000 employees. Nine-month severance costs were $91.7 million, with $18.8 million remaining accrued at period-end.
- After a sustained share-price decline left market capitalization significantly below the reporting unit’s carrying value, the company recorded a $1.05 billion goodwill impairment. Goodwill fell to $2.64 billion from $3.67 billion at November 30, 2025. The impairment used Level 3 valuation inputs and was nondeductible for tax purposes.
- The company issued $600 million of 6.50% notes due 2029 and used the proceeds, together with other funds, to refinance 2026 notes; it redeemed the remaining $200 million of 2026 notes in August. It also prepaid $100 million of term-loan principal. Debt extinguishment costs for the nine months were $6.3 million.
- A non-core business was classified as held for sale following a February 2026 sale agreement for approximately €15 million, subject to customary conditions and adjustments. Closing was expected in the fourth quarter of fiscal 2026. The company recorded an $8.4 million nine-month loss on held for sale; it did not classify the business as discontinued operations.
- Management notes that revenue and margins are typically higher in the fourth fiscal quarter. The filing provides no specific full-year revenue or earnings guidance. It highlights uncertainty around client demand, competition and pricing, labor costs, foreign exchange and inflation, tariffs and trade policy, geopolitical conditions, cyber risks, and adoption of emerging technologies including AI.
Other significant disclosures
The company reported compliance with debt covenants at August 31, 2026. Its credit agreement includes a maximum consolidated leverage ratio of 3.75 to 1.00 (with specified acquisition-related exceptions) and a minimum interest coverage ratio of 3.00 to 1.00. A 100-basis-point increase in rates on variable-rate debt would, holding other factors constant, increase annual interest expense by an estimated $24.4 million. The company reported effective disclosure controls and no material change in internal control over financial reporting. It reported no new material legal proceedings and no material change in previously disclosed risk factors.
Investor verification priorities
- Review the goodwill impairment assumptions and test whether future cash-flow forecasts, valuation multiples or market conditions could prompt additional impairment.
- Track underlying operating trends alongside GAAP results and the company’s non-GAAP adjustments, particularly restructuring costs and adjusted EBITDA margin.
- Verify progress on the announced non-core business sale, expected closing timing, proceeds and final purchase-price adjustments.
- Assess near-term debt maturities, refinancing or repayment plans, covenant headroom, and the availability of cash and receivables-backed borrowing capacity.
- Monitor whether cost reductions translate into durable margin improvement without disrupting service delivery, and whether client and industry revenue trends stabilize.
- Check future filings for cash-flow conversion, factoring effects, foreign-exchange impacts, and the sustainability of dividends and repurchases.