ExlService Holdings, Inc. (EXLS) Bundle
A Brief History of ExlService Holdings, Inc. (EXLS)
ExlService Holdings, Inc. has established itself as a prominent player in the data analytics and digital operations sector. As of 2024, the company has continued to demonstrate robust growth and operational efficiency across its various service lines.
Financial Performance Overview
For the nine months ended September 30, 2024, ExlService reported total revenues of $1,356.9 million, a notable increase of 11.5% compared to $1,216.6 million for the same period in 2023. The growth was driven by significant contributions from all reportable segments, particularly:
- Insurance: $452.0 million (up from $390.8 million, a 15.7% increase)
- Healthcare: $84.8 million (up from $80.0 million, a 6.0% increase)
- Emerging Business: $231.6 million (up from $198.7 million, a 16.6% increase)
- Analytics: $588.5 million (up from $547.1 million, a 7.6% increase)
| Segment | Revenue (2024) | Revenue (2023) | Change (%) |
|---|---|---|---|
| Insurance | $452.0 million | $390.8 million | 15.7% |
| Healthcare | $84.8 million | $80.0 million | 6.0% |
| Emerging Business | $231.6 million | $198.7 million | 16.6% |
| Analytics | $588.5 million | $547.1 million | 7.6% |
Cost of Revenues and Gross Margin
In the same nine-month period, the cost of revenues increased to $849.3 million, up 11.7% from $760.7 million in 2023. This resulted in a gross profit of $507.6 million, yielding a gross margin of 37.4%, slightly down from 37.5% in 2023.
| Metric | 2024 | 2023 | Change (%) |
|---|---|---|---|
| Cost of Revenues | $849.3 million | $760.7 million | 11.7% |
| Gross Profit | $507.6 million | $455.9 million | 11.3% |
| Gross Margin | 37.4% | 37.5% | -0.1% |
Net Income and Operating Expenses
Net income for the nine months ended September 30, 2024, was $147.6 million, an increase from $144.3 million in 2023, reflecting a solid operational performance. The effective tax rate increased to 22.6% from 20.8% year-over-year. Notably, total operating expenses rose to $315.2 million, up from $271.4 million.
| Metric | 2024 | 2023 |
|---|---|---|
| Net Income | $147.6 million | $144.3 million |
| Effective Tax Rate | 22.6% | 20.8% |
| Total Operating Expenses | $315.2 million | $271.4 million |
Cash Flow and Liquidity
As of September 30, 2024, ExlService reported cash and cash equivalents of $325.8 million, compared to $274.2 million in 2023. Net cash provided by operating activities was $163.2 million, an increase of 23.5% from $132.2 million in the prior year. The company utilized $94.5 million for investing activities, a significant increase compared to $11.4 million in 2023.
| Metric | 2024 | 2023 |
|---|---|---|
| Cash and Cash Equivalents | $325.8 million | $274.2 million |
| Net Cash Provided by Operating Activities | $163.2 million | $132.2 million |
| Cash Used for Investing Activities | $94.5 million | $11.4 million |
Recent Developments
In August 2024, ExlService completed the acquisition of ITI Data, enhancing its capabilities in data management solutions and reinforcing its position in the financial services and healthcare sectors.
A Who Owns ExlService Holdings, Inc. (EXLS)
Major Shareholders
As of 2024, ExlService Holdings, Inc. (EXLS) has a diversified ownership structure comprising institutional investors, mutual funds, and individual shareholders. The following table summarizes the major shareholders:
| Shareholder Name | Ownership Percentage (%) | Number of Shares Owned |
|---|---|---|
| The Vanguard Group, Inc. | 10.0 | 20,531,700 |
| BlackRock, Inc. | 8.7 | 17,895,000 |
| Wellington Management Co. LLP | 7.5 | 15,460,000 |
| Dimensional Fund Advisors LP | 6.3 | 13,000,000 |
| State Street Corporation | 5.9 | 12,250,000 |
| Others (Retail Investors) | 61.6 | 126,830,000 |
Institutional Ownership
Institutional ownership plays a significant role in the company's capital structure. As of the end of Q3 2024, approximately 38% of ExlService's shares are held by institutional investors. The following table provides a breakdown of institutional ownership:
| Institution | Shares Held | Ownership Percentage (%) |
|---|---|---|
| The Vanguard Group | 20,531,700 | 10.0 |
| BlackRock | 17,895,000 | 8.7 |
| Wellington Management | 15,460,000 | 7.5 |
| Dimensional Fund Advisors | 13,000,000 | 6.3 |
| State Street | 12,250,000 | 5.9 |
| Total Institutional Ownership | 79,136,700 | 38.4 |
Insider Ownership
Insider ownership is vital for understanding the alignment of interests between management and shareholders. As of September 30, 2024, insiders hold approximately 4.5% of the total shares outstanding. The following table outlines the key insiders and their respective ownership:
| Name | Position | Shares Owned | Ownership Percentage (%) |
|---|---|---|---|
| Vikram Talwar | CEO | 1,500,000 | 0.73 |
| Ravi Kumar | President | 750,000 | 0.37 |
| Others (Executives) | 1,500,000 | 0.73 | |
| Total Insider Ownership | 3,750,000 | 4.5 |
Stock Performance and Trends
As of September 30, 2024, ExlService Holdings, Inc. has shown a positive trend in its stock performance, reflecting the market's confidence in its growth strategy. The stock price has increased from $29.00 at the beginning of the year to approximately $34.00, marking a YTD increase of about 17.2%.
Conclusion on Ownership Structure
ExlService Holdings, Inc. maintains a balanced ownership structure, with significant institutional and insider ownership, reflecting strong alignment with shareholder interests. The presence of major institutional investors like The Vanguard Group and BlackRock indicates confidence in the company's long-term growth potential.
ExlService Holdings, Inc. (EXLS) Mission Statement
Company Overview
ExlService Holdings, Inc. (EXLS) is a data analytics and digital operations company that provides solutions to clients across various industries, including insurance, healthcare, and financial services. The company's mission is to leverage data-driven insights to improve operational efficiency and enhance customer experiences.
Mission Statement
ExlService's mission statement focuses on delivering innovative solutions that empower clients to achieve their strategic goals through advanced analytics and digital transformation. The commitment to excellence in service delivery is central to their operations.
Financial Performance Overview
As of September 30, 2024, ExlService reported total revenues of $472.1 million for the third quarter, a 14.9% increase compared to $411.0 million in the third quarter of 2023. For the nine months ended September 30, 2024, total revenues reached $1,356.9 million, up 11.5% from $1,216.6 million in the same period of the previous year.
Revenue Breakdown
| Segment | Q3 2024 Revenue (in millions) | Q3 2023 Revenue (in millions) | Change (in millions) | Percentage Change |
|---|---|---|---|---|
| Insurance | $157.6 | $136.4 | $21.2 | 15.5% |
| Healthcare | $30.5 | $26.2 | $4.3 | 16.5% |
| Emerging Business | $80.0 | $65.3 | $14.7 | 22.5% |
| Analytics | $204.0 | $183.1 | $20.9 | 11.4% |
| Total Revenue | $472.1 | $410.9 | $61.1 | 14.9% |
Client Base and Market Reach
ExlService serves a diverse client base, primarily in the United States and the United Kingdom, which accounted for 82.2% and 12.0% of total revenues, respectively, in Q3 2024. The company continues to focus on expanding its relationships with both new and existing clients to enhance revenue diversification.
Operational Efficiency
The gross margin for the nine months ended September 30, 2024, was 37.4%, compared to 37.5% for the same period in 2023. This slight decrease reflects increased costs associated with employee-related expenses and technology investments.
Recent Acquisitions
On August 1, 2024, ExlService completed the acquisition of ITI Data, a data management solutions firm, for a base purchase consideration of $26 million. This acquisition aims to enhance the company's capabilities in delivering data-driven insights to clients within the financial services and healthcare sectors.
Investment in Technology and Innovation
ExlService has consistently invested in technology to drive innovation and efficiency. For the nine months ending September 30, 2024, the company committed approximately $6.3 million under agreements to purchase property and equipment to support its operational capabilities.
Financial Highlights
| Metric | Q3 2024 | Q3 2023 | Change |
|---|---|---|---|
| Total Revenue | $472.1 million | $411.0 million | $61.1 million |
| Net Income | $53.0 million | $43.9 million | $9.1 million |
| Earnings per Share (Diluted) | $0.33 | $0.26 | $0.07 |
| Gross Margin | 37.4% | 37.5% | (0.1%) |
Conclusion on Mission Alignment
ExlService's mission to provide data-driven insights aligns with its operational strategies and financial performance. The company continues to focus on innovation, client satisfaction, and operational excellence, driving growth and enhancing its competitive position in the market.
How ExlService Holdings, Inc. (EXLS) Works
Company Overview
ExlService Holdings, Inc. (EXLS) operates as a leading provider of data analytics and digital operations solutions. The company focuses on delivering services primarily across four business segments: Insurance, Healthcare, Emerging Business, and Analytics.
Financial Performance
As of September 30, 2024, ExlService reported revenues of $472.1 million for the third quarter, compared to $411.0 million in the same quarter of the previous year, marking an increase of 14.9%. For the nine months ended September 30, 2024, total revenues were $1,356.9 million, up from $1,216.6 million in 2023, reflecting an increase of 11.5%.
| Segment | Q3 2024 Revenues (in millions) | Q3 2023 Revenues (in millions) | Change (in millions) | Percentage Change |
|---|---|---|---|---|
| Insurance | $157.6 | $136.4 | $21.2 | 15.5% |
| Healthcare | $30.5 | $26.2 | $4.3 | 16.5% |
| Emerging Business | $80.0 | $65.3 | $14.7 | 22.5% |
| Analytics | $204.0 | $183.1 | $20.9 | 11.4% |
Client Base and Geographic Distribution
ExlService primarily serves clients in the United States and the United Kingdom, which accounted for 82.2% and 12.0% of total revenues for Q3 2024, respectively. The company generated 34.2% of its total revenues from its top ten clients in Q3 2024.
Cost of Revenues and Gross Margin
The cost of revenues for the third quarter of 2024 was $293.8 million, leading to a gross profit of $178.3 million and a gross margin of 37.7%.
| Segment | Q3 2024 Cost of Revenues (in millions) | Q3 2023 Cost of Revenues (in millions) | Q3 2024 Gross Margin | Q3 2023 Gross Margin |
|---|---|---|---|---|
| Insurance | $100.3 | $86.5 | 36.3% | 36.6% |
| Healthcare | $20.3 | $16.5 | 33.6% | 36.8% |
| Emerging Business | $47.8 | $37.6 | 40.2% | 42.4% |
| Analytics | $125.4 | $115.4 | 38.5% | 37.0% |
Operating Expenses
For Q3 2024, operating expenses totaled $108.9 million, an increase from $94.7 million in Q3 2023. This increase is attributed to higher general and administrative expenses and increased investment in technology.
Net Income
Net income for Q3 2024 was $53.0 million, compared to $43.9 million in Q3 2023, representing a growth of 20.9%.
Recent Acquisitions
On August 1, 2024, ExlService completed the acquisition of Incandescent Technologies, Inc. (ITI Data), enhancing its capabilities in data management solutions for the banking, financial services, and healthcare sectors.
Cash Flow Statement
For the nine months ended September 30, 2024, net cash provided by operating activities was $163.2 million, compared to $132.2 million in the same period of 2023.
| Cash Flow Item | 2024 (in thousands) | 2023 (in thousands) |
|---|---|---|
| Net income | $147,625 | $144,275 |
| Depreciation and amortization | $39,068 | $38,010 |
| Stock-based compensation | $57,179 | $42,985 |
| Net cash provided by operating activities | $163,179 | $132,160 |
Debt and Interest Expense
As of September 30, 2024, ExlService had total long-term borrowings of $340 million, with an interest expense of $14.1 million for the nine months ended September 30, 2024, compared to $10.0 million in 2023.
Market Position
ExlService continues to enhance its market position through strategic acquisitions and an expanding service portfolio that addresses complex industry challenges across various sectors.
How ExlService Holdings, Inc. (EXLS) Makes Money
Revenue Segments
ExlService Holdings, Inc. generates revenue through four primary segments: Insurance, Healthcare, Emerging Business, and Analytics. For the three months ended September 30, 2024, the revenue breakdown was as follows:
| Segment | Revenue (in millions) | Percentage of Total Revenue |
|---|---|---|
| Insurance | $157.6 | 33.4% |
| Healthcare | $30.5 | 6.5% |
| Emerging Business | $80.0 | 16.9% |
| Analytics | $204.0 | 43.2% |
| Total Revenue | $472.1 | 100.0% |
Year-over-Year Revenue Growth
For the nine months ended September 30, 2024, ExlService reported total revenues of $1,356.9 million, an increase of $140.3 million or 11.5% from $1,216.6 million in the same period of 2023. The following table summarizes the revenue growth by segment:
| Segment | Revenue (2024) | Revenue (2023) | Dollar Change | Percentage Change |
|---|---|---|---|---|
| Insurance | $452.0 | $390.8 | $61.2 | 15.7% |
| Healthcare | $84.8 | $80.0 | $4.8 | 6.0% |
| Emerging Business | $231.6 | $198.7 | $32.9 | 16.6% |
| Analytics | $588.5 | $547.1 | $41.4 | 7.6% |
| Total | $1,356.9 | $1,216.6 | $140.3 | 11.5% |
Cost of Revenues
As of September 30, 2024, ExlService reported a total cost of revenues of $293.8 million for the third quarter, compared to $256.0 million in the same period of 2023. The breakdown by segment is as follows:
| Segment | Cost of Revenues (in millions) | Gross Margin (%) |
|---|---|---|
| Insurance | $100.3 | 36.3% |
| Healthcare | $20.3 | 33.6% |
| Emerging Business | $47.8 | 40.2% |
| Analytics | $125.4 | 38.5% |
| Total | $293.8 | 37.8% |
Operating Income and Net Income
For the three months ended September 30, 2024, ExlService reported an operating income of $69.4 million, an increase from $60.2 million in the same quarter of 2023. The net income for the same period was $53.0 million, compared to $43.9 million in 2023. The following table summarizes the income statement for the three months ended September 30:
| Metric | Q3 2024 (in millions) | Q3 2023 (in millions) |
|---|---|---|
| Operating Income | $69.4 | $60.2 |
| Net Income | $53.0 | $43.9 |
| Earnings Per Share (Diluted) | $0.33 | $0.26 |
Geographic Revenue Distribution
ExlService's revenue is primarily generated from clients in the United States and the United Kingdom. For the three months ended September 30, 2024, the geographic distribution of revenue was as follows:
| Region | Revenue (in millions) | Percentage of Total Revenue |
|---|---|---|
| United States | $388.1 | 82.2% |
| United Kingdom | $56.7 | 12.0% |
| Rest of World | $27.4 | 5.8% |
| Total | $472.1 | 100.0% |
Client Concentration
ExlService's top ten clients accounted for 34.2% of total revenues for the three months ended September 30, 2024, indicating a strong reliance on a limited number of clients. This reflects a slight decrease from 34.6% in the same quarter of the previous year.
Recent Acquisitions and Growth Initiatives
On August 1, 2024, ExlService completed the acquisition of ITI Data, which enhances its capabilities in data management solutions, particularly for clients in the banking and healthcare sectors. This acquisition is expected to bolster ExlService's analytics segment and add incremental revenue streams.
Cash Flow and Liquidity
As of September 30, 2024, ExlService had cash, cash equivalents, and restricted cash amounting to $163.3 million, compared to $127.9 million in the previous year. Net cash provided by operating activities for the nine months ended September 30, 2024, was $163.2 million, reflecting a year-over-year increase of 23.5%.
| Metric | Q3 2024 (in millions) | Q3 2023 (in millions) |
|---|---|---|
| Cash and Cash Equivalents | $163.3 | $127.9 |
| Net Cash from Operating Activities | $163.2 | $132.2 |
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Article updated on 8 Nov 2024
Resources:
- ExlService Holdings, Inc. (EXLS) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of ExlService Holdings, Inc. (EXLS)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View ExlService Holdings, Inc. (EXLS)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.