Globant S.A. (GLOB)

Overview

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See "Information on the Company — History and Development of the Company" and "Information on the Company — Business Overview — Overview".

A. Operating Results

Factors Affecting Our Results of Operations

Over the last few years, the simultaneous digital and cognitive revolutions have transformed the technology industry, reshaped how companies connect with consumers and employees, and created opportunities for gains in efficiency. Today's technology users move quickly and demand personalized and frictionless experiences through always-available digital ecosystems. Increased demand for more intelligent and human-like technology is contributing to changes in the industry. To address user demands, companies are leveraging AI, UX, Mobile, Cloud, VR and other technologies.

We believe that the most significant factors affecting our results of operations include:

•market demand for integrated engineering, design and innovation technology services relating to emerging technologies and related market trends;

•economic conditions in the industries and countries in which our clients operate and their impact on our clients' spending on technology services;

•our ability to continue to innovate and remain at the forefront of emerging technologies and related market trends;

•expansion of our service offerings and success in cross-selling new services to our clients;

•our ability to obtain new clients, increase penetration levels with our existing clients and continue to add value for our existing clients so as to create long-term relationships;

•the availability of, and our ability to attract, retain and efficiently utilize, skilled IT professionals in 31 countries where we are present;

•operating costs in countries where we operate;

•capital expenditures related to the opening of new delivery centers and client management locations and improvement of existing offices;

•our ability to increase our presence onsite at client locations;

•the effect of wage inflation in countries where we operate and the variability in foreign exchange rates, especially relative changes in exchange rates between the U.S. dollar and local currencies, mainly in Latin America;

•our ability to identify, integrate and effectively manage businesses that we may acquire; and

•evolving market for products with AI capabilities.

Our results of operations in any given period are directly affected by the following additional company-specific factors:

•Pricing of, and margin on, our services and revenue mix. Since time-and-materials is our main type of contract, the hourly rates we charge for our Globers are a key factor impacting our gross profit margins and profitability. Hourly rates vary by complexity of the project and the mix of staffing. The margin on our services is impacted by the increase in our costs in providing those services, which is influenced by wage inflation, market conditions and other factors. As a client relationship matures and deepens, we seek to maximize our revenues and profitability by expanding the scope of services offered to that client and achieving higher profit margin assignments. During the three-year period ended December 31, 2025, we increased our revenues attributable to sales of technology solutions (primarily through digital transformation, data and cloud strategies). Gross profit margin was 35.0%, 35.7% and 36.1% for the years ended December 31, 2025, 2024 and 2023, respectively and adjusted gross profit margin was 37.9%, 38.2% and 38.1% for the years ended December 31, 2025, 2024 and 2023, respectively. See "Operating and financial review and prospects - Operating Results - Adjusted Diluted EPS and Adjusted Net Income.".

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•Our ability to deepen and expand the portfolio of services we offer while maintaining our high standard of quality. The breadth and depth of the services we offer impact our ability to grow revenues from new and existing clients. Through research and development, targeted hiring and strategic acquisitions, we have invested in broadening and deepening the domains of expertise of our Studios. Our future growth and success depend significantly on our ability to maintain the expertise of each of our Studios, to continue to innovate and to anticipate the needs of our clients and rapidly develop and maintain the expertise of each of our Studios, including relevant domain knowledge and technological capabilities required to meet those client needs, while maintaining our high standard of quality.

•Our ability to recruit, retain and manage our IT professionals may have an effect on our gross profit margin and our results of operations. Our IT professional headcount was 26,906 as of December 31, 2025, 29,198 as of December 31, 2024 and 27,116 as of December 31, 2023. We manage employee headcount and utilization based on ongoing assessments of our project pipeline and requirements for professional capabilities. An unanticipated termination of a significant project could cause us to experience lower employee utilization resulting from a higher than expected number of idle IT professionals. Our ability to effectively utilize our employees is typically improved by longer-term client relationships due to increased predictability of client needs over the course of the relationships.

•Investments in our delivery platform. See “Information on the Company — Business overview. — Facilities and Infrastructure.” Our integrated global delivery platform allows us to deliver our services through a blend of onsite and offsite methods. We have pursued a decentralization strategy in building our network of delivery centers, recognizing the benefits of expanding into countries in Latin America and Asia, including the ability to attract and retain highly skilled IT professionals in increasing scale. Our ability to effectively utilize our robust delivery platform could significantly affect our results of operations in the future.

•Seasonality. See “Information on the Company - Business overview — Seasonality.”

Our results of operations are expected to benefit from government policies and regulations, see "Information of the Company - Business Overview — Government Support and Incentives."

Certain Income Statement Line Items

2025 Compared to 2024

Revenues

Revenues are derived primarily from providing technology services to our clients, which are medium to large-sized companies globally. For the year ended December 31, 2025, revenues increased by 1.6% to $2.5 billion from $2.4 billion for the year ended December 31, 2024.

We discuss below the breakdown of our revenues by contract type, client location, industry vertical and client concentration. Revenues consist of technology services revenues and reimbursable expenses, which primarily include travel and out-of-pocket costs that are billable to clients.

Revenues by Contract type

We perform our services primarily under time-and-material contracts and, to a lesser extent, fixed-price contracts. The remaining portion of our revenues in each year was derived from other types of contracts.

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Revenues by Client Location

Our revenues are sourced from the following four regions: North America, Latin America, Europe and New Markets. We present our revenues by client location based on the location of the specific client site that we serve, irrespective of the location of the headquarters of the client or the location of the delivery center where the work is performed. For the year ended December 31, 2025, we had 944 customers with more than one hundred thousand U.S. dollars in revenue in the last twelve months.

The following table sets forth revenues by client location by amount and as a percentage of our revenues for the years indicated:

Revenues by Industry Vertical

We are a provider of technology services to enterprises in a range of industry verticals including media and entertainment, consumer, retail and manufacturing and banks, financial services and insurance, among others. The following table sets forth our revenues by amount and as a percentage of our revenues by industry vertical for the periods indicated:

Our largest industry during 2025 was Banks, Financial Services and Insurance, fueled by increased engagement with global financial institutions and a strategic pivot toward digital banking infrastructure. The Media and Entertainment vertical experienced a slight contraction, as the industry recalibrated following the high-growth cycles of previous years. The Consumer, Retail & Manufacturing vertical remained a steady pillar of our portfolio. We observed notable momentum in the Travel & Hospitality vertical, benefiting from a sustained global recovery in corporate and leisure mobility. At the same time, both the Professional Services and Technology & Telecommunications verticals faced headwinds, as clients in these sectors slowed their tech spend. Our Health Care vertical remained stable.

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Revenues by Client Concentration

We have increased our revenues by expanding the scope and size of our engagements, and we have grown our key client base primarily through our business development efforts and referrals from our existing clients.

The following table sets forth revenues contributed by our largest client, top five clients, top ten clients and top twenty clients by amount and as a percentage of

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