Concentrix Corp. and Teleperformance SE shares fell sharply today after Concentrix cut its revenue outlook for fiscal year 2026. The company now expects full-year reported revenue of $9.925 billion to $10.025 billion, implying constant currency growth of 0.25% to 1.25%, down from its prior view. This revision is primarily attributed to a faster-than-expected shift to offshore locations, which now presents a nearly 300-basis-point headwind, and clients reducing support for certain customer segments in high-cost markets. Analysts expressed concern that AI's growing role in customer service could make these companies "uninvestible."
Despite the lowered outlook, Concentrix reported a record fiscal second quarter with $257.9 million in cash flow from operations and $242.3 million in adjusted free cash flow. Second-quarter revenue increased 1.9% year-on-year to $2,462.5 million, with non-GAAP diluted EPS at $2.63. The company projects third-quarter reported revenue of $2.465 billion to $2.490 billion and non-GAAP diluted EPS between $2.65 and $2.77.
In contrast, AeroVironment (AVAV) stock surged roughly 21% after reporting fiscal Q4 results that exceeded Wall Street estimates. The defense technology company's revenue for the quarter hit $641.6 million, significantly above the $557.37 million analysts expected, and up 133% year-over-year. For the full fiscal year, revenue rose 141% to a record $1.98 billion, with annual bookings reaching $2.7 billion. Quarterly net income jumped to $63.2 million, or $1.25 per diluted share, and adjusted earnings per share came in at $1.84, topping the $1.48 forecast.
The strong performance of AeroVironment was fueled by acquisitions, specifically BlueHalo and Empirical Systems Aerospace, which contributed $282.3 million in quarterly revenue. CEO Wahid Nawabi labeled fiscal 2026 a "transformational year." Investor confidence is high due to the company's diversification into counter-UAS systems, directed-energy weapons, and space and cyber technologies. While gross margin declined to 32% due to a higher mix of service revenue and amortization, the company plans to spend 12% to 14% of revenue on capital expenditures in fiscal 2027 to expand manufacturing capacity, aligning with strong demand signals for drone and counter-drone technology.
