Nagarro’s superior client experience and its strategic diversification continued to deliver resilient growth in the face of global economic uncertainties. In Q2 2023, revenue grew to €226.8 million, up 8.0% YoY from €210.0 million in Q2 2022. Constant currency YoY revenue growth for Q2 2023 was 10.7%. Organic YoY revenue growth for the quarter was 8.7% in constant currency, which translated to 6.1% organic YoY revenue growth in Euro terms. Gross profit declined to €57.5 million in Q2 2023 from €60.2 million in Q2 2022. Due to excess production capacity which is reflected in the cost of revenues, gross margin dropped to 25.3% in Q2 2023 from 28.7% in Q2 2022. Adjusted EBITDA declined to €28.9 million (12.8% of revenue) in Q2 2023, from €40.2 million (19.1% of revenue) in Q2 2022.
EBITDA declined to €27.3 million in Q2 2023, from €39.4 million in Q2 2022. The main EBITDA adjustments were on account of the share payment expenses of €0.9 million and acquisition expenses of €0.7 million. EBIT declined to €19.5 million in Q2 2023, from €31.1 million in Q2 2022. Net profit declined to €11.5 million in Q2 2023 against €22.4 million in Q2 2022.
The company added net 736 professionals in Q2 2023, 642 of which were via the acquired entities.
Nagarro released its half-yearly report. Revenue grew to €456.4 million in H1 2023, up 15.4 % YoY from €395.6 million in H1 2022. Constant currency revenue growth for H1 2023 was 16.5%. Organic YoY revenue growth for H1 2023 was 14.9% in constant currency, which translated to 14.2% organic YoY revenue growth in Euro terms. Gross profit increased to €118.9 million in H1 2023 from €110.5 million in H1 2022. Gross margin dropped to 26.1% in H1 2023 from 27.9% in H1 2022. Adjusted EBITDA declined to €60.3 million (13.2 % of revenue) in H1 2023, from €69.1 million (17.5% of revenue) in H1 2022. EBITDA decreased to €58.1 million in H1 2023, from €67.2 million in H1 2022. EBIT declined to €42.6 million in H1 2023, from €51.6 million in H1 2022. Net profit declined to €26.6 million in H1 2023 against €36.3 million in H1 2022. The cash balance decreased by €10.8 million from December 31, 2022 to €99.3 million, mainly on account of buyback of shares.
Manas Human, co-founder, said, “Nagarro has continued to grow and expand in H1, even as a digital engineering company in a business environment that has not been very conducive to discretionary spending. Though a few of our client projects had to scale back, fully 168 clients generated over 1 million Euro in revenue in the trailing twelve months to June 30, 2023, compared to just 131 for the same period a year ago. This reflects the growth dynamism that is present in most of Nagarro’s business. Our long-term investments in diversifying across geographies and industries have paid off. So has our long-term focus on superior client experience, exemplified by a Net Promoter Score of over 60, which drives client stickiness and loyalty in difficult times. Nagarro is taking strong steps to trim its cost base, but our strategy remains to prioritize long-term growth.”
Nagarro will hold its analyst meeting as a video call to discuss half-yearly report 2023 on August 14, 2023, at 01:00 pm CEST (04:00 am PT / 06:00 am CT / 07:00 am ET / 12:00 pm BST / 03:00 pm GST / 04:30 pm IST /07:00pm SGT/08:00pm JST).