Capgemini records Q1 2024 revenues of €5.5 billion in line with expectations

Paris, April 30, 2024 – The Capgemini Group reported Q1 2024 revenues of €5,527 million, -3.5% year-on-year at current exchange rates and -3.3% at constant exchange rates*.

Aiman Ezzat, Chief Executive Officer of the Capgemini Group, said: “As anticipated, the market continued to slow down in Q1, and we confirm the growth trough is now behind us. We expect the market to gradually pick up toward an attractive exit growth rate in Q4, setting up for a more tangible acceleration in 2025.

The pipeline continues to grow and the demand for large-scale digital transformation projects remains strong. Client focus remains on operational and cost efficiency programs, however we also see good traction for our high-added value services in Intelligent industry as well as for our sustainability offerings.

In generative AI, we launched a new platform to enable clients to experiment with industry-specific use cases, and to industrialize them, at a controlled cost.

In that context, we reiterate all our objectives for the full year.”

 

 

In line with the Group’s expectations, Capgemini’s Q1 revenues were down year-on-year at -3.3% at constant exchange rates^* and -3.6% organically (i.e., adjusted for Group scope and exchange rates).

In a macro environment which remains soft, large corporations and organizations are still prioritizing operational agility and cost efficiency programs with fast payback, at the expense of non-strategic and discretionary deals. In that context, Capgemini’s high value-added service offerings – most notably in Intelligent Industry, as well as in activities driven by Cloud, Data & Artificial Intelligence – enjoyed a solid traction in Q1.

OPERATIONS BY REGION

At constant exchange rates, revenues in the North America region (28% of Group revenues in Q1 2024) declined by -7.1% year-on-year, a rate similar to Q4 2023. The Financial Services and TMT (Telecoms, Media and Technology) sectors contributed the most to this decline, partly offset by growth in the Manufacturing sector.

Revenues in the United Kingdom and Ireland region (12% of Group revenues) were down -3.2%, mostly driven by the Financial Services and TMT sectors. Conversely, the Services and Energy & Utilities sectors enjoyed solid momentum, as did the Manufacturing sector to a lesser extent.

Activity in France (20% of Group revenues) declined by -2.8%, with some softness in the Manufacturing and Financial Services sectors and a dynamic Public sector.  

Revenues in the Rest of Europe region (32% of Group revenues) were almost stable at -0.5%. The underlying performance by sector showed more contrast, with good momentum in the Energy & Utilities and Public sectors and a visible contraction of the TMT sector.

Finally, revenues in the Asia-Pacific and Latin America region (8% of Group revenues) were down -1.7% almost entirely driven by the Financial Services and TMT sectors, while the Consumer Goods & Retail sector proved quite dynamic.

OPERATIONS BY BUSINESS 

At constant exchange rates, total revenues* of Strategy & Transformation services (9% of the Group’s total revenues in Q1 2024) were up +1.6% year-on-year at constant exchange rates. This growth reflects client focus on strategic initiatives to transform, optimize and adapt their business and operations to a challenging economic environment, as well as investment in Gen AI.

Total revenues of Applications & Technology services (62% of the Group’s total revenues and Capgemini’s core business) declined by -4.0%.

Lastly, Operations & Engineering (29% of the Group’s total revenues) total revenues contracted by -3.0%.

HEADCOUNT

The Group’s total headcount stood at 337,200 as at March 31, 2024, down 6% year-on-year. The offshore workforce represents 57% of the total headcount, i.e. 192,000 employees.

BOOKINGS

Bookings totaled €5,655 million in Q1 2024, down -3.5% year-on-year at constant exchange rates. The book-to-bill ratio of 1.02 is above the Q1 historical average.

OUTLOOK

The Group’s financial targets for 2024 are:

• Revenue growth of +0% to +3% at constant currency;
• Operating margin of 13.3% to 13.6%;
• Organic free cash flow of around €1.9 billion.

The inorganic contribution to growth should be marginal at the lower end of the target range, and up to 1 point at the upper end.

CONFERENCE CALL

Aiman Ezzat, Chief Executive Officer, accompanied by Nive Bhagat, Chief Financial Officer, and Olivier Sevillia, Chief Operating Officer, will present this press release during a conference call in English to be held today at 8.00 a.m. Paris time (CET). You can follow this conference call live via webcast at the following link. A replay will also be available for a period of one year.

All documents relating to this publication will be posted on the Capgemini investor website at https://investors.capgemini.com/en/.

PROVISIONAL CALENDAR

May 16, 2024    –    Shareholders’ meeting

July 26, 2024   –     Half-Year 2024 results

The dividend payment schedule to be submitted to the Shareholders’ Meeting for approval would be:

May 29, 2024   –     Ex-dividend date on Euronext Paris

May 31, 2024    –    Payment of the dividend

 

DISCLAIMER

This press release may contain forward-looking statements. Such statements may include projections, estimates, assumptions, statements regarding plans, objectives, intentions and/or expectations with respect to future financial results, events, operations and services and product development, as well as statements, regarding future performance or events. Forward-looking statements are generally identified by the words “expects”, “anticipates”, “believes”, “intends”, “estimates”, “plans”, “projects”, “may”, “would”, “should” or the negatives of these terms and similar expressions. Although Capgemini’s management currently believes that the expectations reflected in such forward-looking statements are reasonable, investors are cautioned that forward-looking statements are subject to various risks and uncertainties (including, without limitation, risks identified in Capgemini’s Universal Registration Document available on Capgemini’s website), because they relate to future events and depend on future circumstances that may or may not occur and may be different from those anticipated, many of which are difficult to predict and generally beyond the control of Capgemini. Actual results and developments may differ materially from those expressed in, implied by or projected by forward-looking statements. Forward-looking statements are not intended to and do not give any assurances or comfort as to future events or results. Other than as required by applicable law, Capgemini does not undertake any obligation to update or revise any forward-looking statement.

This press release does not contain or constitute an offer of securities for sale or an invitation or inducement to invest in securities in France, the United States or any other jurisdiction.

ABOUT CAPGEMINI

Capgemini is a global business and technology transformation partner, helping organizations to accelerate their dual transition to a digital and sustainable world, while creating tangible impact for enterprises and society. It is a responsible and diverse group of 340,000 team members in more than 50 countries. With its strong over 55-year heritage, Capgemini is trusted by its clients to unlock the value of technology to address the entire breadth of their business needs. It delivers end-to-end services and solutions leveraging strengths from strategy and design to engineering, all fueled by its market leading capabilities in AI, cloud and data, combined with its deep industry expertise and partner ecosystem. The Group reported 2023 global revenues of €22.5 billion.

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