CI&T Inc(CINT)2024-11-14 18:38Financial Data and Key Metrics Changes - CI&T achieved record net revenue of BRL622.2 million in Q3 2024, a 17.6% increase compared to BRL529.1 million in Q3 2023, with constant currency net revenue growth of 9% year-over-year [8][22] - Adjusted EBITDA for Q3 2024 reached BRL121 million, a 24.2% increase from BRL98 million in the same period last year, with an adjusted EBITDA margin of 19.5%, up by one percentage point from Q3 2023 [29][30] - Adjusted net profit was BRL56.5 million, a 32.9% increase compared to Q3 2023, with the adjusted net profit margin rising from 8% to 9.1% [30] Business Line Data and Key Metrics Changes - Revenue from Financial Services, Consumer Goods and Retail, and Industrial Goods verticals grew by double digits year-over-year in Q3 2024 [25] - Revenue from Retail and Industrial Goods sectors doubled compared to Q3 2023, driven by new clients acquired in the last 18 months [26] Market Data and Key Metrics Changes - Geographic distribution of net revenue for the first nine months of 2024: 44% from North America, 41% from Latin America, 11% from Europe, and 4% from Asia-Pacific [23] - Net revenue from Latin America grew by 11% on a sequential basis in Q3 2024, while North America remains the fastest-growing market [24] Company Strategy and Development Direction - CI&T is focusing on AI as a transformative force and optimizing its sales machine, with a strong emphasis on enhancing offerings and competitiveness through CI&T FLOW [11][51] - The company aims to increase wallet share among its largest clients while expanding its presence within their organizations, aligning with a land and expand strategy [27] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism for Q4 2024, expecting net revenue in the range of BRL620 million to BRL655 million, representing a 22% year-over-year growth at the midpoint [32] - The company anticipates a stable demand environment in the US post-elections, with a strong pipeline and record bookings in Q3 2024 [46] Other Important Information - CI&T onboarded 520 new employees globally in Q3 2024, with a total headcount of 6,700, reflecting a 10.5% year-over-year growth [12][10] - The company has streamlined its talent acquisition process using AI, enhancing its ability to support high-growth ambitions [10] Q&A Session Summary Question: Employee growth and utilization rates - Management indicated that headcount growth is in line with revenue growth, and utilization rates remain healthy between 85% and 90% [37][41] Question: Margin improvement factors - Management highlighted productivity gains from cost management and investments in hiring and AI initiatives as key drivers for margin improvement [44] Question: North America commercial environment post-elections - Management noted a slightly better demand environment in the US, with stable budgets for large companies and a strong pipeline [46] Question: AI's impact on results - Management stated that CI&T FLOW has significantly enhanced productivity, with teams using AI showing up to 300% faster results compared to non-Flow teams [51] Question: Sustainability of demand trends - Management indicated that the majority of competitors are traditional IT service players, and they expect stable demand trends moving forward [73]