What changed in this filing

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Item 2. Management’s Discussion and Analysis

2024-10-04 compared with 2024-07-05 · 118 added, 103 removed, 334 unchanged (40% of the section changed)

2 unchanged sentences

References to “we,” “our,” “us,” or “the Company” or “Concentrix” refer to Concentrix Corporation and its subsidiaries.

Certain comparisons of the year-over-year changes in revenue and cost of revenue in the discussion of our results of operations for the three and six months ended May 31, 2024 and 2023 include a supplemental comparison as if the Webhelp Combination had occurred at the beginning of fiscal year 2023.

Certain comparisons of the year-over-year changes in revenue and cost of revenue in the discussion of our results of operations for the three and nine months ended August 31, 2024 and 2023 include a supplemental comparison as if the Webhelp Combination had occurred at the beginning of fiscal year 2023.

These supplemental comparisons can be identified by the language “if the Webhelp Combination had occurred at the beginning of fiscal year 2023”.

15 unchanged sentences

geopolitical, economic and climate- or weather-related risks in regions with a significant concentration of our operations;

the inability to execute on our strategy;

the ability to successfully execute our strategy;

competitive conditions in our industry and consolidation of our competitors;

26 unchanged sentences

On September 25, 2023, we completed our acquisition (the “Webhelp Combination”) of all of the issued and outstanding capital stock (the “Shares”) of Marnix Lux SA, a public limited liability company ( société anonyme ) incorporated under the laws of the Grand Duchy of Luxembourg (“Webhelp Parent”) and the parent company of the Webhelp business (“Webhelp”), from the holders thereof (the “Sellers”).

Webhelp was a leading provider of CX solutions, including sales, marketing, and payment services, with significant operations and client relationships in Europe, Latin America, and Africa.

The acquisition was completed pursuant to the terms and conditions of the Share Purchase and Contribution Agreement, dated as of June 12, 2023, as amended by First Amendment to Share Purchase and Contribution Agreement, dated as of July 14, 2023 by and among Concentrix, OSYRIS S.à r.l., a private limited liability company ( société à responsabilité limitée ) incorporated under the laws of the Grand Duchy of Luxembourg and a direct wholly owned subsidiary of Concentrix Corporation (“Purchaser”), Webhelp Parent, the Sellers, and certain representatives of the Sellers.

Webhelp is a leading provider of CX solutions, including sales, marketing, and payment services, with significant operations and client relationships in Europe, Latin America, and Africa.

The preliminary purchase consideration for the acquisition of the Shares is valued at approximately $3,774.8 million, net of cash and restricted cash acquired.

The purchase consideration for the acquisition of the Shares is valued at approximately $3,774.8 million, net of cash and restricted cash acquired.

Revenue and Cost of Revenue

8 unchanged sentences

Our cost of revenue as a percentage of revenue has also fluctuated in the past, based primarily on our ability to achieve economies of scale, the management of our operating expenses, and the timing and costs incurred related to our acquisitions and investments.

In the second fiscal quarters of 2024 and 2023, approximately 79% and 80%, respectively, of our consolidated revenue was generated from our non-U.S.

Through the third quarter of fiscal years 2024 and 2023, approximately 87% and 81%, respectively, of our consolidated revenue was generated from our non-U.S.

operations, and approximately 50% and 68%, respectively, of our consolidated revenue was priced in U.S.

19 unchanged sentences

Critical Accounting Policies and Estimates

During the three and six months ended May 31, 2024, there were no material changes to our critical accounting policies and estimates previously disclosed in our Annual Report on Form 10-K for the fiscal year ended November 30, 2023.

Results of Operations – Three and Six Months Ended May 31, 2024 and 2023

Three Months Ended Six Months Ended

May 31, 2024 May 31, 2023 May 31, 2024 May 31, 2023

During the three and nine months ended August 31, 2024, there were no material changes to our critical accounting policies and estimates previously disclosed in our Annual Report on Form 10-K for the fiscal year ended November 30, 2023.

Results of Operations – Three and Nine Months Ended August 31, 2024 and 2023

Three Months Ended Nine Months Ended

August 31, 2024 August 31, 2023 August 31, 2024 August 31, 2023

($ in thousands) ($ in thousands)

9 unchanged sentences

Net income $ 16,631 $ 77,635 $ 135,567 $ 244,355

Three Months Ended % Change Six Months Ended % Change

May 31, 2024 May 31, 2023 2024 to 2023

Three Months Ended % Change Nine Months Ended % Change

August 31, 2024 August 31, 2023 2024 to 2023

($ in thousands)

10 unchanged sentences

Our solutions focus on customer engagement, process optimization, and back-office automation.

Our revenue increased by 47.4% in the three months ended May 31, 2024, compared to the three months ended May 31, 2023, primarily as a result of the Webhelp Combination.

For the three months ended May 31, 2024, revenue across all verticals increased, primarily as a result of the Webhelp Combination.

Our revenue increased by 46.2% in the three months ended August 31, 2024, compared to the three months ended August 31, 2023, primarily as a result of the Webhelp Combination.

For the three months ended August 31, 2024, revenue across all verticals increased, primarily as a result of the Webhelp Combination.

The increase in revenue was partially offset by the negative effect of foreign currency translation of $22.5 million, or 1.4%.

The unfavorable foreign currency translation effect on revenue was primarily due to the weakening of the Argentine peso and Japanese yen against the U.S.

If the Webhelp Combination had occurred at the beginning of fiscal year 2023, our revenue would have increased by 1.8% in the three months ended May 31, 2024.

Our revenue increased by 47.1% in the six months ended May 31, 2024, compared to the six months ended May 31, 2023, primarily as a result of the Webhelp Combination.

For the six months ended May 31, 2024, revenue across all verticals increased, primarily as a result of the Webhelp Combination.

If the Webhelp Combination had occurred at the beginning of fiscal year 2023, our revenue would have increased by 0.9% in the three months ended August 31, 2024.

Our revenue increased by 46.8% in the nine months ended August 31, 2024, compared to the nine months ended August 31, 2023, primarily as a result of the Webhelp Combination.

For the nine months ended August 31, 2024, revenue across all verticals increased, primarily as a result of the Webhelp Combination.

The increase in revenue was partially offset by the negative effect of foreign currency translation of $58.3 million, or 1.2%.

The unfavorable foreign currency translation effect on revenue was primarily due to the weakening of the Argentine peso and Japanese yen against the U.S.

If the Webhelp Combination had occurred at the beginning of fiscal year 2023, our revenue would have increased by 1.8% in the six months ended May 31, 2024.

If the Webhelp Combination had occurred at the beginning of fiscal year 2023, our revenue would have increased by 1.5% in the nine months ended August 31, 2024.

Cost of Revenue, Gross Profit and Gross Margin Percentage

Three Months Ended % Change Six Months Ended % Change

May 31, 2024 May 31, 2023 2024 to 2023

Three Months Ended % Change Nine Months Ended % Change

August 31, 2024 August 31, 2023 2024 to 2023

($ in thousands) ($ in thousands)

4 unchanged sentences

Gross margin can be impacted by resource location, client mix and pricing, additional lead time for programs to be fully scalable, and transition and initial set-up costs.

Our cost of revenue increased by 47.2% in the three months ended May 31, 2024, compared to the three months ended May 31, 2023, primarily due to the increases in our revenue and personnel costs related to the Webhelp Combination.

Our cost of revenue increased by 46.6% in the three months ended August 31, 2024, compared to the three months ended August 31, 2023, primarily due to the increases in our revenue and personnel costs from the Webhelp Combination.

The increases were partially offset by a $42.2 million, or 4.1%, reduction in our cost of revenue due to foreign currency translation.

The foreign currency translation impact on our cost of revenue was caused primarily by the weakening of the Argentine peso, Egyptian pound, and Philippine peso against the U.S.

If the Webhelp Combination had occurred at the beginning of fiscal year 2023, our cost of revenue would have increased by 1.5% in the three months ended May 31, 2024.

Our cost of revenue increased by 46.9% in the six months ended May 31, 2024, compared to the six months ended May 31, 2023, primarily due to the increases in our revenue and personnel costs related to the Webhelp Combination.

If the Webhelp Combination had occurred at the beginning of fiscal year 2023, our cost of revenue would have increased by 1.2% in the three months ended August 31, 2024.

Our cost of revenue increased by 46.8% in the nine months ended August 31, 2024, compared to the nine months ended August 31, 2023, primarily due to the increases in our revenue and personnel costs from the Webhelp Combination.

The increases were partially offset by a $103.2 million, or 3.3%, reduction in our cost of revenue due to foreign currency translation.

The foreign currency translation impact on our cost of revenue was caused primarily by the weakening of the Argentine peso, Egyptian pound and Philippine peso against the U.S.

If the Webhelp Combination had occurred at the beginning of fiscal year 2023, our cost of revenue would have increased by 1.5% in the six months ended May 31, 2024.

Our gross profit increased by 47.8% in the three months ended May 31, 2024, compared to the three months ended May 31, 2023, primarily due to the increase in revenue and the contributions from the Webhelp Combination and a net favorable foreign currency impact of $15.6 million on gross profit, partially offset by the increase in cost of revenue.

Our gross margin percentage for the three months ended May 31, 2024 increased to 36.0% from 35.9% in the prior fiscal year period due to changes in the mix of geographies where our services were delivered.

Our gross profit increased by 47.6% in the six months ended May 31, 2024, compared to the six months ended May 31, 2023, primarily due to the increase in revenue and the contributions from the Webhelp Combination and a net favorable foreign currency impact of $25.2 million on gross profit, partially offset by the increase in cost of revenue.

Our gross margin percentage for the six months ended May 31, 2024 increased to 35.8% from 35.7% in the prior fiscal year period due to changes in the mix of geographies where our services were delivered.

The foreign currency translation impact on our cost of revenue was caused primarily by the weakening of the Argentine peso, Philippine peso, and Egyptian pound against the U.S.

If the Webhelp Combination had occurred at the beginning of fiscal year 2023, our cost of revenue would have increased by 1.4% in the nine months ended August 31, 2024.

Our gross profit increased by 45.6% in the three months ended August 31, 2024, compared to the three months ended August 31, 2023, primarily due to the increase in revenue, contributions from the Webhelp Combination, and a net favorable foreign currency impact of $19.7 million on gross profit, partially offset by the increase in cost of revenue.

Our gross margin percentage for the three months ended August 31, 2024 decreased to 36.2% from 36.4% in the prior fiscal year period due to changes in the mix of geographies where our services were delivered.

Our gross profit increased by 46.9% in the nine months ended August 31, 2024, compared to the nine months ended August 31, 2023, primarily due to the increase in revenue, profit contributions from the Webhelp Combination, and a net favorable foreign currency impact of $44.9 million on gross profit, partially offset by the increase in cost of revenue.

Our gross margin percentage for the nine months ended August 31, 2024 increased to 36.0% from 35.9% in the prior fiscal year period due to changes in the mix of geographies where our services were delivered.

Selling, General and Administrative Expenses

Three Months Ended % Change Six Months Ended % Change

May 31, 2024 May 31, 2023 2024 to 2023

Three Months Ended % Change Nine Months Ended % Change

August 31, 2024 August 31, 2023 2024 to 2023

($ in thousands) ($ in thousands)

4 unchanged sentences

Selling, general and administrative expenses also include the cost of our global delivery facilities, utility expenses, hardware and software costs related to our technology infrastructure, legal and professional fees, depreciation on our technology and facility equipment, amortization of intangible assets resulting from acquisitions, marketing expenses, and acquisition-related and integration expenses.

Our selling, general and administrative expenses increased by 69.4% in the three months ended May 31, 2024, compared to the three months ended May 31, 2023, primarily due to incremental selling, general and administrative expenses associated with the Webhelp Combination, an increase in amortization expenses, primarily associated with the intangible assets from the Webhelp

Combination, of $76.5 million, and an increase in acquisition-related and integration expenses of $23.5 million.

Our selling, general and administrative expenses increased by 64.8% in the three months ended August 31, 2024, compared to the three months ended August 31, 2023, primarily due to incremental selling, general and administrative expenses associated with the Webhelp Combination, an increase in amortization expenses of $77.0 million, primarily associated with the intangible assets from the

Webhelp Combination, and an increase in acquisition-related and integration expenses of $17.6 million.

These increases were partially offset by a $9.5 million reduction in selling, general and administrative expenses due to foreign currency translation impacts.

As a percentage of revenue, selling, general and administrative expenses increased from 25.9% in the second fiscal quarter of 2023 to 29.7% in the second fiscal quarter of 2024 due to the net effect of the changes described.

Our selling, general and administrative expenses increased by 68.0% in the six months ended May 31, 2024, compared to the six months ended May 31, 2023, primarily due to incremental selling, general and administrative expenses associated with the Webhelp Combination, an increase in amortization expenses, primarily associated with the intangible assets from the Webhelp Combination, of $153.6 million and an increase in acquisition-related and integration expenses of $48.1 million.

As a percentage of revenue, selling, general and administrative expenses increased from 26.4% in the third fiscal quarter of 2023 to 29.8% in the third fiscal quarter of 2024 due to the net effect of the changes described.

Our selling, general and administrative expenses increased by 66.9% in the nine months ended August 31, 2024, compared to the nine months ended August 31, 2023, primarily due to incremental selling, general and administrative expenses associated with the Webhelp Combination, an increase in amortization expenses of $230.6 million, primarily associated with the intangible assets from the Webhelp Combination, and an increase in acquisition-related and integration expenses of $65.7 million.

These increases were partially offset by a $21.9 million reduction in selling, general and administrative expenses due to foreign currency translation impacts.

As a percentage of revenue, selling, general and administrative expenses increased from 25.9% in the six months ended May 31, 2023 to 29.6% in the six months ended May 31, 2024 due to the net effect of the changes described.

As a percentage of revenue, selling, general and administrative expenses increased from 26.1% in the nine months ended August 31, 2023 to 29.7% in the nine months ended August 31, 2024 due to the net effect of the changes described.

Operating Income

Three Months Ended % Change Six Months Ended % Change

May 31, 2024 May 31, 2023 2024 to 2023

Three Months Ended % Change Nine Months Ended % Change

August 31, 2024 August 31, 2023 2024 to 2023

($ in thousands) ($ in thousands)

1 unchanged sentence

Operating margin 6.4 % 9.9 % 6.3 % 9.8 %

Our operating income decreased during the three and six months ended May 31, 2024, compared to the three and six months ended May 31, 2023, due to the increase in selling, general and administrative expenses partially offset by the increase in gross profit.

Our operating margin decreased during the three and six months ended May 31, 2024, compared to the three and six months ended May 31, 2023, due to the increase in selling, general and administrative expenses as a percentage of revenue partially offset by the increase in gross margin percentage.

Our operating income decreased during the three and nine months ended August 31, 2024, compared to the three and nine months ended August 31, 2023, due to the increase in selling, general and administrative expenses partially offset by the increase in gross profit.

Our operating margin decreased during the three and nine months ended August 31, 2024, compared to the three and nine months ended August 31, 2023, due to the increase in selling, general and administrative expenses as a percentage of revenue partially offset by the increase in gross margin percentage.

Interest Expense and Finance Charges, Net

Three Months Ended % Change Six Months Ended % Change

May 31, 2024 May 31, 2023 2024 to 2023

Three Months Ended % Change Nine Months Ended % Change

August 31, 2024 August 31, 2023 2024 to 2023

($ in thousands) ($ in thousands)

2 unchanged sentences

Amounts recorded in interest expense and finance charges, net consist primarily of interest on our senior notes issued in August 2023, interest expense on term loan borrowings under our senior credit facility, interest expense on borrowings under our accounts receivable securitization facility (the “Securitization Facility”), interest expense on the promissory note issued by us to certain Sellers in connection with the Webhelp Combination (the “Sellers’ Note”) and financing expenses incurred in fiscal year 2023 associated with our commitment letter dated March 29, 2023 (the “Bridge Commitment Letter,” and the commitments pursuant to the Bridge Commitment Letter, the “Bridge Facility”), entered into in connection with the Webhelp Combination.

The increase in interest expense and finance charges, net for the three months ended May 31, 2024, compared to the three months ended May 31, 2023, was primarily due to interest expense on our senior notes of $36.8 million and interest expense, including imputed interest, associated with the Sellers’ Note of $8.0 million, each of which were not outstanding in the prior year period, partially offset by a decrease of Bridge Facility financing fees and credit facility amendment fees of $11.8 million incurred in the second quarter of 2023 that did not recur.

The increase in interest expense and finance charges, net for the six months ended May 31, 2024, compared to the six months ended May 31, 2023, was primarily due to interest expense on our senior notes of $73.6 million and interest expense, including imputed interest, associated with the Sellers’ Note of $16.0 million, each of which were not outstanding in the prior year period, partially offset by a decrease of Bridge Facility financing fees and credit facility amendment fees of $11.8 million incurred in the second quarter of 2023 that did not recur.

The increase in interest expense and finance charges, net for the three months ended August 31, 2024, compared to the three months ended August 31, 2023, was primarily due to an increase in interest expense on our senior notes of $24.6 million, interest expense, including imputed interest, associated with the Sellers’ Note of $8.1 million, and a decrease in interest income related to the senior notes proceeds of $7.8 million incurred in the prior year period that did not recur.

The senior notes were outstanding for only a portion of the prior year period and the Sellers’ Note was not outstanding in the prior year period.

These changes were partially offset by a decrease of Bridge Facility financing fees of $10.7 million incurred in the third quarter of fiscal year 2023 that did not recur in the current period.

The increase in interest expense and finance charges, net for the nine months ended August 31, 2024, compared to the nine months ended August 31, 2023, was primarily due to an increase in interest expense on our senior notes of $98.2 million, interest expense, including imputed interest, associated with the Sellers’ Note of $24.0 million and a decrease in interest income related to the

senior notes proceeds of $7.8 million incurred in the prior year period that did not recur.

The senior notes were outstanding for only a portion of the prior year period and the Sellers’ Note was not outstanding in the prior year period.

These changes were partially offset by a decrease of Bridge Facility financing fees and credit facility amendment fees of $22.5 million incurred in the nine months ended August 31, 2023 that did not recur.

Other Expense (Income), Net

Three Months Ended % Change Six Months Ended % Change

May 31, 2024 May 31, 2023 2024 to 2023

Three Months Ended % Change Nine Months Ended % Change

August 31, 2024 August 31, 2023 2024 to 2023

($ in thousands) ($ in thousands)

2 unchanged sentences

Amounts recorded as other expense (income), net primarily include foreign currency transaction gains and losses other than cash flow hedges, investment gains and losses, the non-service component of pension costs, other non-operating gains and losses, and changes in acquisition contingent consideration related to the Webhelp Combination.

Other expense (income), net in the three months ended May 31, 2024 was income of $19.4 million, compared to expense of $9.4 million in the three months ended May 31, 2023.

The change in other expense (income), net over the prior fiscal year period was primarily due to net foreign currency gains and income associated with the change in acquisition contingent consideration associated with the Webhelp Combination of $6.7 million during the three months ended May 31, 2024

Other expense (income), net in the six months ended May 31, 2024 was income of $26.2 million, compared to expense of $13.1 million in the six months ended May 31, 2023.

The change in other expense (income), net over the prior fiscal year period was primarily due to income associated with the change in acquisition contingent consideration associated with the Webhelp Combination of $21.6 million during the six months ended May 31, 2024 and net foreign currency gains.

Other expense (income), net in the three months ended August 31, 2024 was expense of $46.0 million, compared to expense of $6.2 million in the three months ended August 31, 2023.

The change in other expense (income), net over the prior fiscal year period was primarily due to net foreign currency losses and expense of $10.5 million due to the change in acquisition contingent consideration associated with the Webhelp Combination during the three months ended August 31, 2024

Other expense (income), net in the nine months ended August 31, 2024 was expense of $19.8 million, compared to expense of $19.3 million in the nine months ended August 31, 2023.

The change in other expense (income), net over the prior fiscal year period was primarily due to net foreign currency losses primarily offset by income of $11.1 million due to the change in acquisition contingent consideration associated with the Webhelp Combination during the nine months ended August 31, 2024.

Provision for Income Taxes

Three Months Ended % Change Six Months Ended % Change

May 31, 2024 May 31, 2023 2024 to 2023

Three Months Ended % Change Nine Months Ended % Change

August 31, 2024 August 31, 2023 2024 to 2023

($ in thousands) ($ in thousands)

2 unchanged sentences

Our provision for income taxes consists of our current and deferred tax expense resulting from our income earned in domestic and international jurisdictions.

Our provision for income taxes decreased in the three and six months ended May 31, 2024, compared to the three and six months ended May 31, 2023, primarily due to a decrease in income before taxes.

The effective tax rate for the three and six months ended May 31, 2024 decreased compared to the three and six months ended May 31, 2023, primarily due to the change in mix of income earned in different tax jurisdictions between periods.

Our provision for income taxes decreased in the three and nine months ended August 31, 2024, compared to the three and nine months ended August 31, 2023, primarily due to a decrease in income before taxes.

The effective tax rate for the three and nine months ended August 31, 2024 increased compared to the three and nine months ended August 31, 2023, primarily due to the change in mix of income earned in different tax jurisdictions between periods.

Certain Non-GAAP Financial Information

4 unchanged sentences

• Adjusted EBITDA margin, which is adjusted EBITDA, as defined above, divided by revenue.

• Non-GAAP net income, which is net income excluding the tax effected impact of acquisition-related and integration expenses, including related restructuring costs, amortization of intangible assets, share-based compensation, imputed interest related to the Sellers’ note, change in acquisition contingent consideration and foreign currency losses (gains), net.

• Non-GAAP net income, which is net income excluding the tax effected impact of acquisition-related and integration expenses, including related restructuring costs, amortization of intangible assets, share-based compensation, imputed interest related to the sellers’ note issued in connection with the combination with Webhelp (the “sellers’ note”), change in acquisition contingent consideration and foreign currency losses (gains), net.

Non-GAAP net income also excludes the income tax effect of certain legal entity restructuring activity.

• Free cash flow, which is cash flows from operating activities less capital expenditures, and adjusted free cash flow, which is free cash flow excluding the effect of changes in the outstanding factoring balance.

4 unchanged sentences

• Non-GAAP diluted earnings per common share (“EPS”), which is diluted EPS excluding the per share, tax effected impact of acquisition-related and integration expenses, including related restructuring costs, step-up depreciation, amortization of intangible assets, share-based compensation, imputed interest related to the Sellers’ note, change in acquisition contingent consideration and foreign currency losses (gains), net.

Non-GAAP EPS also excludes the per share income tax effect of certain legal entity restructuring activity.

Non-GAAP EPS excludes net income attributable to participating securities, and the per share, tax-effected impact of adjustments to net income described above reflect only those amounts that are attributable to common shareholders.

11 unchanged sentences

These non-GAAP financial measures also exclude share-based compensation expense.

Given the subjective assumptions and the variety of award types that companies can use when calculating share-based compensation expense, management believes this additional information allows investors to make additional comparisons between our operating results and those of our peers.

between our operating results and those of our peers.

As these non-GAAP financial measures are not calculated in accordance with GAAP, they may not necessarily be comparable to similarly titled measures employed by other companies.

These non-GAAP

financial measures should not be considered in isolation or as a substitute for the comparable GAAP measures and should be used as a complement to, and in conjunction with, data presented in accordance with GAAP.

Three Months Ended Six Months Ended

May 31, 2024 May 31, 2023 May 31, 2024 May 31, 2023

These non-GAAP financial measures should not be considered in isolation or as a substitute for the comparable GAAP measures and should be used as a complement to, and in conjunction with, data presented in accordance with GAAP.

Three Months Ended Nine Months Ended

August 31, 2024 August 31, 2023 August 31, 2024 August 31, 2023

($ in thousands, except per share amounts)

37 unchanged sentences

(55,753) (22,020) (134,448) (57,626)

Income tax effect of legal entity restructuring (4)

5,363 — 5,363 —

Non-GAAP net income $ 192,158 $ 143,696 $ 552,968 $ 417,232

Three Months Ended Six Months Ended

May 31, 2024 May 31, 2023 May 31, 2024 May 31, 2023

Three Months Ended Nine Months Ended

August 31, 2024 August 31, 2023 August 31, 2024 August 31, 2023

($ in thousands, except per share amounts)

15 unchanged sentences

(0.84) (0.43) (1.99) (1.10)

Income tax effect of legal entity restructuring (4)

0.08 — 0.08 —

Non-GAAP Diluted EPS $ 2.87 $ 2.76 $ 8.16 $ 7.98

1 unchanged sentence

(2) Foreign currency losses (gains), net are included in other expense (income), net and primarily consist of gains and losses recognized on the revaluation and settlement of foreign currency transactions and realized and unrealized gains and losses on derivative contracts that do not qualify for hedge accounting.

The reported amounts for non-GAAP net income and non-GAAP EPS for the three and six months ended May 31, 2024 include adjustments to exclude these foreign currency losses (gains), net, which were not adjusted in similar non-GAAP measures previously reported for the corresponding period in fiscal year 2023.

In order to enhance comparability, similar adjustments were made for non-GAAP net income and non-GAAP EPS for the three and six months ended May 31, 2023.

The reported amounts for non-GAAP net income and non-GAAP EPS for the three and nine months ended August 31, 2024 include adjustments to exclude these foreign currency losses (gains), net, which were not adjusted in similar non-GAAP measures previously reported for the corresponding period in fiscal year 2023.

In order to enhance comparability, similar adjustments were made for non-GAAP net income and non-GAAP EPS for the three and nine months ended August 31, 2023.

(3) The tax effect of taxable and deductible non-GAAP adjustments was calculated using the tax deductible portion of the expenses and applying the entity specific, statutory tax rates applicable to each item during the respective periods.

(4) Represents the income tax impact related to certain legal entity restructuring activity.

Liquidity and Capital Resources

Our primary uses of cash are working capital, capital expenditures to expand our delivery footprint and enhance our technology solutions, debt repayments, and acquisitions, including our combination with Webhelp in September 2023.

Our primary uses of cash are working capital, capital expenditures to expand our delivery footprint and enhance our technology solutions, debt repayments, and acquisition and integration expenses, including in connection with our September 2023 combination with Webhelp.

Our financing needs for these uses of cash have been a combination of operating cash flows and third-party debt arrangements.

9 unchanged sentences

The share repurchase program has no termination date and may be suspended or discontinued at any time.

During the three and six months ended May 31, 2024, we repurchased 662,580 and 899,685 shares, respectively, of our common stock under the share repurchase program for approximately $40.6 million and $62.3 million, respectively, in the aggregate.

During the three and six months ended May 31, 2023, we repurchased 39,084 and 110,424 shares, respectively, of our common stock under the share repurchase program for approximately $4.9 million and $14.9 million, respectively, in the aggregate.

At May 31, 2024, approximately $227.8 million remained available for share repurchases under the existing authorization from our board of directors.

During June 2024, we repurchased 215,452 shares of our common stock for an aggregate purchase price of $13.0 million.

During the three and nine months ended August 31, 2024, we repurchased 607,298 and 1,506,983 shares, respectively, of our common stock under the share repurchase program for approximately $39.3 million and $101.6 million, respectively, in the aggregate.

During the three and nine months ended August 31, 2023, we repurchased 320,105 and 430,529 shares, respectively, of our common stock under the share repurchase program for approximately $27.0 million and $41.9 million, respectively, in the aggregate.

At August 31, 2024, approximately $188.5 million remained available for share repurchases under the existing authorization from our board of directors.

During September 2024, we repurchased 161,613 shares of our common stock for an aggregate purchase price of $10.6 million.

During fiscal years 2024 and 2023, we have paid the following dividends per share approved by our board of directors:

6 unchanged sentences

March 26, 2024 April 26, 2024 $0.3025 May 7, 2024

On June 26, 2024, we announced a cash dividend of $0.3025 per share to stockholders of record as of the close of business on July 26, 2024, payable on August 6, 2024.

June 26, 2024 July 26, 2024 $0.3025 August 6, 2024

On September 25, 2024, we announced a cash dividend of $0.33275 per share to stockholders of record as of the close of business on October 25, 2024, payable on November 5, 2024.

We expect that future cash dividends will be paid on a quarterly basis.

However, any decision to pay future cash dividends will be subject to our board of directors’ approval, and will depend on many factors, such as our financial condition, earnings, capital requirements, debt service obligations, restrictive covenants in our debt agreements, industry practice, legal requirements, regulatory constraints, and other factors that our board of directors deems relevant.

Our ability to pay dividends will depend on our ongoing ability to generate cash from operations and on our access to the capital markets.

Our ability to pay dividends will depend on our ongoing

ability to generate cash from operations and on our access to the capital markets.

We cannot guarantee that we will continue to pay a dividend in the future.

Debt Arrangements

aggregate principal amount of 6.850% Senior Notes due 2033 (the “2033 Notes”) and, together with the 2026 Notes and 2028 Notes, the “Senior Notes”).

On August 2, 2023, we issued and sold (i) $800 million aggregate principal amount of 6.650% Senior Notes due 2026 (the “2026 Notes”), (ii) $800 million aggregate principal amount of 6.600% Senior Notes due 2028 (the “2028 Notes”) and (iii) $550 million aggregate principal amount of 6.850% Senior Notes due 2033 (the “2033 Notes”) and, together with the 2026 Notes and 2028 Notes, the “Senior Notes”).

The Senior Notes were sold in a registered public offering pursuant to our Registration Statement on Form S-3, which became effective upon filing, and a Prospectus Supplement dated July 19, 2023, to a Prospectus dated July 17, 2023.

13 unchanged sentences

As of November 30, 2023, the outstanding principal balance on the Term Loan was $1,950 million.

During the three and six months ended May 31, 2024, we voluntarily prepaid $150 million and $250 million, respectively, of the principal balance on the Term Loan, without penalty, resulting in an outstanding balance at May 31, 2024 of approximately $1,700 million.

During the three and nine months ended August 31, 2024, we voluntarily prepaid $100 million and $350 million, respectively, of the principal balance on the Term Loan, without penalty, resulting in an outstanding balance at August 31, 2024 of approximately $1,600 million.

The maturity date of the Restated Credit Facility remains December 27, 2026, subject, in the case of the revolving credit facility, to two one-year extensions upon our prior notice to the lenders and the agreement of the lenders to extend such maturity date.

12 unchanged sentences

From August 31, 2022 through the date of the Amendment Agreement, the outstanding principal of the term loans under the Prior Credit Facility was payable in quarterly installments of $26.25 million.

At May 31, 2024 and November 30, 2023, no amounts were outstanding under our revolving credit facility.

During the six months ended May 31, 2023, we voluntarily prepaid $25.0 million of the principal balance on the term loans under the Prior Credit Facility, without penalty.

At August 31, 2024 and November 30, 2023, no amounts were outstanding under our revolving credit facility.

During the nine months ended August 31, 2023, we voluntarily prepaid $25.0 million of the principal balance on the term loans under the Prior Credit Facility, without penalty.

Securitization Facility

3 unchanged sentences

Borrowing availability under the Securitization Facility may be limited by our accounts receivable balances, changes in the credit ratings of our clients comprising the receivables, client concentration levels in the receivables, and certain characteristics of the accounts receivable being transferred (including factors tracking performance of the accounts receivable over time).

The Securitization Facility contains various affirmative and negative covenants, including a consolidated leverage ratio covenant that is consistent with the Restated Credit Facility and customary events of default, including payment defaults, defaults under certain other indebtedness, a change in control of Concentrix Corporation, and certain events negatively affecting the overall credit quality of the transferred accounts receivable.

other indebtedness, a change in control of Concentrix Corporation, and certain events negatively affecting the overall credit quality of the transferred accounts receivable.

Sellers’ Note

4 unchanged sentences

The discounted value is being amortized into interest expense over the two-year term.

As of May 31, 2024 and November 30, 2023, we were in compliance with the debt covenants related to our debt arrangements.

Cash Flows – Six Months Ended May 31, 2024 and 2023

The following summarizes our cash flows for the six months ended May 31, 2024 and 2023, as reported in our consolidated statement of cash flows in the accompanying consolidated financial statements.

Six Months Ended

May 31, 2024 May 31, 2023

As of August 31, 2024 and November 30, 2023, we were in compliance with the debt covenants related to our debt arrangements.

Cash Flows – Nine Months Ended August 31, 2024 and 2023

The following summarizes our cash flows for the nine months ended August 31, 2024 and 2023, as reported in our consolidated statement of cash flows in the accompanying consolidated financial statements.

Nine Months Ended

August 31, 2024 August 31, 2023

($ in thousands)

2 unchanged sentences

Net cash used in investing activities (183,395) (115,717)

Net cash used in financing activities

Net cash provided by (used in) financing activities

(268,074) 1,636,260

5 unchanged sentences

Operating Activities

Net cash provided by operating activities was $191.5 million for the six months ended May 31, 2024, compared to net cash provided by operating activities of $237.3 million for the six months ended May 31, 2023.

Net cash provided by operating activities was $383.1 million for the nine months ended August 31, 2024, compared to net cash provided by operating activities of $448.7 million for the nine months ended August 31, 2023.

The change over the prior year period was primarily due to unfavorable changes in working capital and the decrease in net income.

Investing Activities

Net cash used in investing activities for the six months ended May 31, 2024 was $120.6 million, compared to $71.8 million for the six months ended May 31, 2023.

The increase in net cash used in investing activities over the prior year period primarily related to an increase in capital expenditures as a result of the expanded business due to the Webhelp Combination and payment of deferred cash consideration of $4.5 million related to the Webhelp Combination in the first quarter of 2024.

Net cash used in investing activities for the nine months ended August 31, 2024 was $183.4 million, compared to $115.7 million for the nine months ended August 31, 2023.

Financing Activities

Net cash used in financing activities for the six months ended May 31, 2024 was $183.3 million, consisting of principal payments of $250.0 million made on term loan borrowings under our senior credit facility, cash paid for acquired earnout liabilities of $22.7, share repurchases of $62.3 million, a change in funds held for clients of $30.6 million, and dividends of $41.0 million partially offset by net borrowings of $223.0 million under our Securitization Facility.

Net cash used in financing activities for the six months ended May 31, 2023 was $162.0 million, consisting primarily of principal payments of $25.0 million made on the term loan borrowings under our senior credit facility, net repayments of $67.5 million under our Securitization Facility, share repurchases of $14.9 million, dividends of $28.6 million, and cash paid for debt issuance costs of $20.7 million related to financing fees for the Bridge Facility entered into in connection with the Webhelp Combination and fees related to our Restated Credit Agreement.

Net cash used in financing activities for the nine months ended August 31, 2024 was $268.1 million, consisting of principal payments of $350.0 million made on term loan borrowings under our senior credit facility, cash paid for acquired earnout liabilities of $22.7, share repurchases of $101.6 million, a change in funds held for clients of $25.8 million, and dividends of $61.2 million partially offset by net borrowings of $290.5 million under our Securitization Facility.

Net cash provided by financing activities for the nine months ended August 31, 2023 was $1,636.3 million, consisting primarily of proceeds, before expenses, of $2,137.0 million from the issuance of Senior Notes in August 2023, partially offset by principal payments of $25.0 million made on the term loan borrowings under our senior credit facility, net repayments of $356.5 million under

our Securitization Facility, share repurchases of $41.9 million, dividends of $42.9 million, and cash paid of $30.5 million related to debt issuance costs for the Senior Notes, financing fees for the Bridge Facility and amendment fees related to our Restated Credit Agreement.

Free Cash Flow and Adjusted Free Cash Flow (non-GAAP measures)

Six Months Ended

May 31, 2024 May 31, 2023

Nine Months Ended

August 31, 2024 August 31, 2023

($ in thousands)

6 unchanged sentences

$ 255,832 $ 333,027

Our free cash flow was $75.3 million for the six months ended May 31, 2024 compared to $165.5 million for the six months ended May 31, 2023.

The decrease in free cash flow for the six months ended May 31, 2024 compared to the prior fiscal year period was due to the decrease in cash provided by operating activities and an increase in capital expenditures resulting from the Webhelp Combination.

Our adjusted free cash flow was $120.6 million for the six months ended May 31, 2024 compared to $165.5 million for the six months ended May 31, 2023.

The decrease in adjusted free cash flow for the six months ended May 31, 2024 compared to the prior year period was due to a decrease in free cash flow partially offset by a change in outstanding factoring balances of $45.3 million.

Our free cash flow was $204.2 million for the nine months ended August 31, 2024 compared to $333.0 million for the nine months ended August 31, 2023.

The decrease in free cash flow for the nine months ended August 31, 2024 compared to the prior fiscal year period was due to the decrease in cash provided by operating activities and an increase in capital expenditures as a result of the expanded business due to the Webhelp Combination.

Our adjusted free cash flow was $255.8 million for the nine months ended August 31, 2024 compared to $333.0 million for the nine months ended August 31, 2023.

The decrease in adjusted free cash flow for the nine months ended August 31, 2024 compared to the prior year period was due to a decrease in free cash flow partially offset by a change in outstanding factoring balances of $51.6 million.

Capital Resources

As of May 31, 2024, we had total liquidity of $1,498.3 million, which includes undrawn capacity on our revolving credit facility of $1,042.5 million, undrawn capacity of $248.5 million under our Securitization Facility and cash and cash equivalents.

Our cash and cash equivalents totaled $207.3 million and $295.3 million as of May 31, 2024 and November 30, 2023, respectively.

As of August 31, 2024, we had total liquidity of $1,469.7 million, which includes undrawn capacity on our revolving credit facility of $1,042.5 million, undrawn capacity of $181.0 million under our Securitization Facility and cash and cash equivalents.

Our cash and cash equivalents totaled $246.2 million and $295.3 million as of August 31, 2024 and November 30, 2023, respectively.

Of our total cash and cash equivalents, 98% and 99% were held by our non-U.S.

legal entities as of May 31, 2024 and November 30, 2023, respectively.

legal entities as of August 31, 2024 and November 30, 2023, respectively.

The cash and cash equivalents held by our non-U.S.

12 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis