IBEX (NASDAQ:IBEX) reported fiscal second-quarter 2026 results that management described as among the strongest in the company’s history, highlighted by double-digit revenue growth, expanding adjusted profitability, and a raised full-year outlook. Executives also emphasized ongoing investment in artificial intelligence, offshore delivery expansion, and continued traction in the company’s health tech vertical.
Quarter highlights: revenue up 16.7% and record EPS
For the fiscal second quarter, IBEX posted revenue of $164.2 million, up 16.7% from $140.7 million in the prior-year period. CEO Bob Dechant said the company delivered “headline revenue growth of 17%” and “adjusted EPS growth of 46%,” marking the fourth consecutive quarter of double-digit organic revenue growth.
On a non-GAAP basis, adjusted EBITDA rose to a record $20.7 million, or 12.6% of revenue, compared with $16.5 million, or 11.8%, in the prior-year quarter. Adjusted net income increased to $12.8 million from $9.6 million, and adjusted diluted EPS increased to $0.87 from $0.59.
Growth drivers: health tech, offshore mix, and digital services
Management attributed the quarter’s revenue growth primarily to strength in several verticals and services. Taylor said growth was driven “predominantly” by:
- Health tech: revenue up 35.1%
- Travel, transportation, and logistics: up 20.2%
- Retail and e-commerce: up 17.2%
Performance in digital acquisition services was also cited as strong, while telecommunications—one of the company’s smallest verticals—declined by 23.1%, which Taylor said was expected.
Dechant highlighted the company’s “new logo engine,” pointing to significant wins in health tech and fintech during the quarter. He added that health tech, launched as a vertical in 2021, has grown rapidly and is “on track to become $100 million by the end of the fiscal year.”
The company also pointed to continued progress in shifting delivery toward higher-margin geographies. Taylor said the firm’s “highest margin offshore revenues” grew 16.2% year over year, nearshore revenues grew 8.5%, and onshore revenue increased 27.5%, driven by growth in high-margin digital acquisition services. Offshore revenue represented 52.3% of total revenue, while onshore rose to 24% from 22% a year earlier.
Digital and omnichannel services grew 19% year over year and accounted for 82% of total revenue. Taylor said IBEX has been structured so that “our growth vectors are our highest margin regions and services.”
Client mix and vertical mix shift away from telecom
On client concentration, Taylor said the largest client accounted for 10% of second-quarter revenue. The top five, top 10, and top 25 clients represented 39%, 57%, and 79% of revenue, respectively, compared with 39%, 54%, and 79% in the prior-year quarter.
By vertical contribution in the quarter:
- Health tech: 17.4% of revenue (vs. 15.1% prior year)
- Travel, transportation, and logistics: 14.1% (vs. 13.7%)
- Retail and e-commerce: 28.6% (flat year over year)
- Other: 13.7% (vs. 10.6%)
- Telecommunications: 8.7% (vs. 13.1%)
- Fintech: 9.3% (vs. 11.0%), which management said is expected to grow in ensuing quarters
Taylor noted the telecom vertical fell below 10% of revenue for the first time since before the company’s IPO, attributing the decline to lower volume from legacy carriers.
AI positioning, India expansion, and margin commentary
Dechant emphasized what he called IBEX’s leadership in “AI-powered CX,” describing the company’s Wave iX AI offering as having two dimensions: enabling client-facing solutions that create an end-to-end journey from AI agent to human agent, and deploying AI internally across the agent lifecycle to improve hiring, training, onboarding, and “speed to green.”
During the Q&A, Dechant told analysts that the company’s AI position supports new logo wins, operational execution, and the creation of “AI agentic solutions.” He described IBEX’s approach as a “seamless journey end to end,” comparing it to an integrated supply chain that increases velocity and engineers cost out.
Executives also discussed expansion in India. Dechant said IBEX entered the market in late March 2025 and now has two sites with nearly 1,000 agents. He said the company has expanded capabilities there beyond traditional contact center services to include revenue cycle management and credentialing services to support healthcare clients, and characterized India as one of the company’s highest growth vectors as it reaches critical mass.
Addressing a question about margin dynamics, Taylor said IBEX feels good about long-term gross margin trajectory given higher-margin verticals, offshore geographies, services, and AI. However, he cited two near-term headwinds: the year-over-year impact of deferred training revenue during a high-growth phase (with training costs expensed in period while revenue is recognized over the program), and ongoing investment in India where the company is “still investing” and “not up to where we expect those margins to be.”
Cash flow, buybacks, and raised FY2026 guidance
IBEX reported net cash from operations of $6.6 million for the quarter, up from $1.1 million in the prior-year period, driven by increased revenue and profitability and lower working capital use. Days sales outstanding were 73 days, and management said it expects DSOs to remain stable in the mid-70s.
Capital expenditures rose to $11.7 million (7.1% of revenue) from $4.3 million (3.1%) a year ago, which management said was a planned increase tied to offshore expansion. Free cash flow was an outflow of $5.1 million, compared with an outflow of $3.2 million in the prior-year quarter.
During the quarter, IBEX repurchased about 78,000 shares for $2.9 million, bringing fiscal-year repurchases to 170,000 shares for $5.6 million. The company ended the quarter with $15.5 million in cash and $1.4 million of debt, for a net cash position of $14 million.
Given first-half outperformance, management raised full-year guidance. Revenue is now expected to be $620 million to $630 million, up from $605 million to $620 million. Adjusted EBITDA is now expected to be $80 million to $82 million, up from $78 million to $81 million. The company also said it expects capital expenditures to be at the upper end of its prior $20 million to $25 million range.
Separately, Dechant announced that Jack Jones has been appointed chairman after nearly nine years on the board, and noted that Mike Darwal, previously president of ibex Digital and deputy CFO, was promoted to chief AI and digital officer.
About IBEX (NASDAQ:IBEX)
IBEX Holdings, Inc is a global business process outsourcing (BPO) company that specializes in customer experience solutions for a range of industries, including telecommunications, cable, technology, financial services and e-commerce. The company’s core offerings encompass multichannel customer support delivered via voice, email, chat, social media and digital self-service platforms. In addition to front-line contact center services, IBEX provides back-office processing, order management, technical troubleshooting and analytics-driven insights to help clients optimize operational efficiency and customer satisfaction.
Beyond traditional contact center operations, IBEX has built a proprietary technology stack designed to integrate real-time data analytics, workforce management and quality assurance.
