GFT Technologies Q3 Earnings Call Highlights

Key Points

• GFT raised its 2026 guidance after nine-month revenue grew 7% to about EUR 701 million and adjusted EBIT rose 16% to nearly EUR 53 million. It now forecasts EUR 945 million in revenue, EUR 72 million in adjusted EBIT, and EUR 45 million in adjusted free cash flow.
• The company dropped its specific EUR 1.5 billion revenue ambition for 2029, prioritizing profitable growth while retaining targets for an adjusted EBIT margin of about 9.5% and high value-added services to reach about half of business. It is also emphasizing AI-focused acquisitions and lowered its smartshore ambition to 30% from 40%.
• Growth was strongest in Brazil, Colombia, and Spain, while Europe revenue declined 1%; the order backlog rose 22% year over year. GFT cited AI-related client work and partnerships, including Deutsche Bank’s core banking modernization and agreements with Anthropic and OpenAI.

GFT Technologies ETR: GFT raised its 2026 revenue and profit forecasts after reporting higher revenue and improved profitability for the first nine months of the year, while replacing its numerical 2029 revenue ambition with a broader focus on profitable growth.

The technology services company generated approximately EUR 701 million in nine-month revenue, up 7% in reported terms and 5% at constant currencies. Adjusted earnings before interest and taxes (EBIT) rose 16% to nearly EUR 53 million, producing a 7.6% margin. EBIT increased 24% to EUR 40 million, with a margin of 5.7%.

GFT raised its full-year revenue guidance to EUR 945 million from EUR 930 million and its adjusted EBIT forecast to EUR 72 million from EUR 71 million. It maintained its EBIT forecast at approximately EUR 56 million and lifted its adjusted free cash flow forecast to EUR 45 million from EUR 40 million.

2029 ambitions shift toward profitability

Global CEO Marco Santos said GFT was moving away from its previous ambition of approximately EUR 1.5 billion in revenue by 2029, instead targeting continued growth without a specific revenue figure. The company retained its ambitions for an adjusted EBIT margin of approximately 9.5% and for high value-added services to represent approximately 50% of its business by 2029.

Santos said artificial intelligence was changing the relationship between headcount, billable work, revenue and outcomes. GFT is also prioritizing specialized acquisitions with a strong AI-related strategic fit over deals focused on adding scale, he said.

The company lowered its 2029 smartshore-versus-onshore ambition to approximately 30% from 40%. Santos said AI transformation increasingly requires engineers and consultants to work closer to clients. In response to an analyst’s question, he put the current smartshore level at approximately 20%.

Growth led by Latin America and Spain

Revenue rose 36% in Brazil, 38% in Colombia and 14% in Spain during the nine-month period, Santos said. All three reported sectors grew: banking revenue increased 6%, insurance 7%, and industry and others 13%.

CFO and Deputy CEO Jochen Ruetz said third-quarter revenue rose 11% from a year earlier and 2% from the second quarter. Adjusted EBIT increased 32% year over year in the quarter, with the margin reaching 8.5%. He attributed the improvement to personnel efficiencies and cost management.

Regional performance was uneven. Ruetz said nine-month revenue declined 1% in Europe, where Germany remained below the prior year despite an improving trend. The U.K. business returned to growth in the third quarter. Americas and Asia-Pacific revenue increased 15%, led by Brazil and Colombia.

Order backlog grew 22% in reported terms and 21% at constant currencies. During the question-and-answer session, Ruetz said the backlog reflected a mixture of projects rather than a single large contract, with most relating to the fourth quarter and 2027 and some extending into 2028 and beyond.

AI platform and banking projects

Santos highlighted several client engagements, including Deutsche Bank’s selection of GFT as its main transformation and system integration partner for modernizing its core banking platform in Germany using Thought Machine’s Vault Core.

At Itaú Unibanco, GFT deployed its Batch2Cloud assets integrated with its Wynxx AI platform. Santos said the work achieved up to 70% shorter migration times and up to 3.3 times faster project delivery cycles.

GFT reported EUR 62.4 million in nine-month revenue influenced by Wynxx, comprising EUR 38.1 million from software engineering and EUR 24.3 million from business processes. Santos also announced partnership agreements with Anthropic and OpenAI and said Google Cloud had selected GFT as a launch partner for Gemini Enterprise for Financial Services.

Cash flow improves as company weighs 2027 costs

Operating cash flow rose to EUR 30 million from EUR 2 million a year earlier, helped by higher net income and improved working capital, Ruetz said. Adjusted free cash flow was positive EUR 19 million, compared with negative EUR 10 million in the prior-year period. He noted that earlier subsidy receipts and the timing of tax payments also affected cash flow, with some rebalancing expected in the fourth quarter.

Looking ahead, Ruetz said higher Brazilian social security contributions could add approximately EUR 7 million in costs in 2027. He said GFT had compensated for the increase well in 2026 and would provide an update on salary inflation when it issued guidance in March.

Asked about the potential for a stronger growth cycle, Santos said client and partner discussions indicated good momentum for 2027, but declined to promise accelerated growth. “I think that we are not conservative. We are responsible,” he said.

About GFT Technologies (ETR:GFT)

GFT Technologies SE, together with its subsidiaries, provides digital transformation services. The company operates in two segments in the Americas, the UK & APAC; and Continental Europe. It offers consulting on the development and implementation of IT strategies; development of bespoke IT solutions; implementation of sector-specific software; and maintenance and development of business-critical IT solutions. The company serves clients in investment and retail banking, insurance, and industrial sectors.

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