What changed in this filing

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Item 7. Management’s Discussion and Analysis

2026-09-10 compared with 2025-09-11 · 135 added, 140 removed, 334 unchanged (45% of the section changed)

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Discussion and analysis for the fiscal year ended June 30, 2025 compared to the fiscal year ended June 30, 2024 may be found in the Company’s Annual Report on Form 10-K for the year ended June 30, 2025 filed with the SEC on September 11, 2025.

1 The Average Price Paid per Share excludes broker commissions.

ibex delivers innovative business process outsourcing (“BPO”), smart digital marketing, online acquisition technology, and end-to-end customer engagement solutions to help companies acquire, engage, and retain valuable customers.

Today, ibex operates a global customer experiences (“CX”) delivery center model consisting of 30 delivery centers around the world, while deploying next-generation technology to drive superior customer experiences for many of the world’s leading companies across various verticals, including Retail & E-commerce, HealthTech, FinTech, Utilities, and Travel, Transportation & Logistics.

ibex delivers innovative business process outsourcing (“BPO”), smart digital marketing, online acquisition technology, end-to-end customer engagement, and Artificial Intelligence (“AI”) solutions to help companies acquire, engage, and retain valuable customers.

ibex operates a global customer experiences (“CX”) delivery center model consisting of 30 delivery centers around the world, while deploying next-generation technology to drive superior customer experiences for many of the world’s leading companies across various verticals, including Retail & E-commerce, HealthTech, Telecommunication, FinTech, Travel, Transportation & Logistics, Technology, and others.

ibex leverages its diverse global team of approximately 35,000 employees together with industry-leading technology, including its Wave iX platform, to manage nearly 176 million customer interactions on behalf of our clients, driving a truly differentiated customer experience.

Business Highlights

During the fiscal year ended June 30, 2025, the Company delivered strong financial results, and experienced growth with leading clients in our Retail & E-commerce, HealthTech, Travel, Transportation & Logistics, and Other verticals, partially offset by decreases in our FinTech and Telecommunications verticals.

We increased capacity in our offshore and nearshore regions and expanded into two new sites.

The business performed well in several important areas during the current year, including total revenues and profitability.

Our sales pipeline remained strong and we had sixteen new client wins during the fiscal year ended June 30, 2025, consistent with eighteen in the prior year.

During the fiscal year ended June 30, 2026, the Company delivered strong financial results and experienced broad-based growth including in our top three verticals:

HealthTech, Travel, Transportation & Logistics, and Retail & E-commerce, with increases of 38.5%, 17.2%, and 14.1%, respectively, when compared to the prior year.

Our growth continues to be driven by outstanding performance within our embedded base clients, along with 17 new client wins during the current fiscal year, and our ability to drive innovative AI solutions across our clients.

We continued to geographically optimize our delivery centers during the current year which included the closure of two nearshore sites concurrent with the expansion into two new offshore sites, and an increase in headcount in our offshore regions by approximately 1,700 employees when compared to the prior year.

Our continued focus and investments in our clients, talent, and technology resulted in revenue growth of 15.4% during the fiscal year ended June 30, 2026, while increasing our net income margin to 7.2% and delivering a consistent adjusted EBITDA margin of 12.8%, when compared to the prior year.

Recent Financial Highlights

The Company delivered revenues of $558.3 million during the fiscal year ended June 30, 2025, a 9.8% increase compared to the prior year due to growth from existing and new clients launched throughout fiscal 2024 and fiscal 2025.

The Company delivered revenues of $644.1 million during the fiscal year ended June 30, 2026, a 15.4% increase compared to the prior year due to growth across our key verticals and digital acquisition business.

Net income during the fiscal year ended June 30, 2026 was $46.3 million, a 25.7% increase from $36.9 million during the prior year.

Fully diluted earnings per share for the fiscal year ended June 30, 2025 of $2.36, increased from $1.84 in the prior year.

The increase in net income was driven by revenue growth in our higher margin offshore regions and improved gross margin performance.

The increase in fully diluted earnings per share was driven by higher net income during the current year and fewer diluted shares outstanding compared to the prior year period.

Fully diluted earnings per share increased to $3.13 for the fiscal year ended June 30, 2026, compared to $2.36 for the prior year.

The increase in net income was driven by revenue growth in our higher margin offshore regions resulting in improved overall operating margins.

The increase in fully diluted earnings per share was driven by higher net income during the current year and fewer diluted shares outstanding compared to the prior year.

Trends and Factors Affecting Our Performance

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Macroeconomic Trends

Macroeconomic factors, including but not limited to, increasing inflation and interest rates, global economic and geopolitical uncertainty, changes in foreign currency exchange rates, and the impact that these factors are having on our clients and their customers, have also impacted our financial results during fiscal year 2025.

Macroeconomic factors, including but not limited to, inflation and interest rates, global economic and geopolitical uncertainty, changes in foreign currency exchange rates, and the impact of these factors on our clients and their customers, could impact our financial results.

Some of our customers have increased their focus on cost reduction, resulting in decisions to shift work from onshore sites to offshore sites, which may impact our revenues and operations in the near term.

However, we also believe that they present opportunities with both new and existing clients, as companies maintain a focus on cost reduction and look for new solutions and delivery options.

Artificial Intelligence (“AI”)

With the increasing applicability of AI in enhancing business processes, the BPO industry is increasingly evaluating and starting to integrate AI into its range of solutions to improve the customer experience and efficiencies.

We are moving aggressively to leverage generative AI in our business.

Our Wave iX technology has a three-pronged AI strategy, which continues to keep ibex at the forefront of digital transformation.

Our solutions are focused on increasing agent productivity, providing deeper customer insights to elevate the customer experience and putting AI in front of the customer journey with voice and chat bots.

We believe we are well positioned to leverage our leadership position in adopting new technology in the CX sector and to create

significant value for our clients through the application of AI.

We believe that our approach to bringing a combination of our AI-enabled solutions plus a robust set of third-party AI-enabled solutions to our clients positions us to not only be a fast-mover in the market, but also to capture an outsized share of AI-impacted future revenue, and to help minimize risk to our overall revenue and provide opportunities for future profitability enhancement.

While the initial implementation of some AI-solutions may impact revenue directly derived from traditional agent-driven activities, it is our belief that by remaining on the forefront and bringing these solutions to our clients, we will be able to capture a greater share of AI-enabled revenue work and maintain and grow our overall business and results in the near- and long-term.

Artificial Intelligence

We are moving aggressively to leverage generative AI in our business, both internally and in consumer-facing interactions.

Our Wave iX technology has a three-pronged AI strategy, which continues to keep ibex at the forefront of this digital transformation.

Our proprietary internal solutions are focused on increasing agent productivity and the quality of our services by leveraging AI across the agent lifecycle to improve recruiting, hiring, training, and coaching.

We are leveraging AI to better understand and improve customer journeys at every step, providing deeper customer insights to tailor client solutions and elevate their customers' experiences.

Finally, leveraging our deep customer experience knowledge and extensive data and analytics on specific customer journeys, we are putting highly customized AI agents in front of the customer journey with voice and chat solutions to automate low-complexity transactions, enable smoother, more effective and efficient, seamless AI to human agent interactions, and provide real-time translation solutions.

With the combination of our company’s decades of experience across BPO and CX solutions, the strength of our internal technologies, our unique stable of best-in-class AI-tech partners, and the depth and breadth of our business intelligence and business insights team, we feel we are uniquely positioned to deliver on the three key tenets to successfully leverage AI in CX:

(1) improving overall customer experience and satisfaction through more effective, efficient, and empathetic AI-to-human solutions, (2) increasing our clients’ ability to serve their end consumers, and (3) driving efficiency, and where beneficial, cost savings along the journey.

We believe we are well positioned to leverage our leadership position in adopting AI technology in the CX sector to create significant value for our clients through the application of AI.

Our approach of bringing a combination of our AI-enabled solutions plus a robust set of third-party AI-enabled solutions to our clients positions us to not only be a fast-mover in the market, but also to capture an outsized share of AI-impacted future revenue, minimizing risk to our overall revenue and providing opportunities for future profitability enhancement.

While the initial implementation of some AI-enabled solutions may impact revenue directly derived from traditional agent-driven activities, it is our belief that by remaining on the forefront and bringing these solutions to our clients, we will be able to capture a greater share of higher margin AI-enabled revenue work and maintain and grow our overall business and results in the near- and long-term.

Client’s Underlying Business Performance

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The correlation between a client's business performance and demand for outsourced customer interaction solutions can therefore be complex, and depends upon several factors, such as industry consolidation, client investments in growth, and overall macroeconomic environment, all of which can result in short term revenue volatility for outsourcing providers.

Demand during the fiscal year ended June 30, 2025 was higher when compared to the prior year due to increased demand for our digital-first solutions, growth in our existing clients, and recent new client wins in strategic verticals.

Demand during the fiscal year

ended June 30, 2026 was higher when compared to the prior year due to increased demand for our digital-first solutions, growth in our existing clients, and recent new client wins in strategic verticals.

Capacity Utilization

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The greater the volume of interactions handled, the higher the utilization level of workstations within those facilities and the revenues generated to cover those fixed costs, thus the greater the percentage operating margin.

As demand for delivery locations has continued to shift towards lower cost geographies during the fiscal year ended June 30, 2025, we have filled up existing capacity and are in the process of building additional capacity in our offshore regions.

In addition, we continue to realize cost savings as we geographically optimize our delivery centers in higher cost regions.

As demand for delivery locations has grown and continued to shift towards lower cost geographies during the fiscal year ended June 30, 2026, we are in the process of building additional capacity in our offshore regions.

We also continue to realize cost savings as we geographically optimize our delivery centers in higher cost regions.

Additionally, we have continued to shift towards work at home seats, which has allowed us to rationalize a number of delivery locations in higher cost regions, especially in the United States.

When compensation levels of our employees increase, we may not be able to pass on such increased costs to our clients or do so on a timely basis, which tends to depress our operating profit margins if we cannot generate sufficient offsetting productivity gains.

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We were able to offset some of these wage increases with higher agent quality and increased productivity, higher agent retention, and increased client prices under contractual cost of living adjustments (“COLA”).

Furthermore, our overall labor cost as a percentage of revenue is impacted by the aforementioned shift in delivery location from onshore delivery centers to offshore centers.

Furthermore, our overall labor cost as a percentage of revenue is positively impacted by the aforementioned shift in delivery location from onshore delivery centers to offshore centers.

Delivery Location

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Client Concentration

During fiscal year 2025, our largest client accounted for 11% while our three largest clients accounted for 26% of our consolidated revenues.

We now have over 60 clients with greater than $1 million in annual revenue and over 25 clients with greater than $5 million in annual revenue.

We believe our client diversification is a strength in a challenging market.

During the fiscal year ended June 30, 2026, our largest client accounted for 9%, while our three largest clients accounted for 24% of our consolidated revenues.

We now have over 65 clients with greater than $1 million in annual revenue and 30 clients with greater than $5 million in annual revenue.

We believe our client diversification is a strength and mitigates risk.

Our revenues are dependent upon both volumes and unit pricing for our services.

Client pricing is often expressed in terms of a base price per minute or hour as well as, in limited cases, with bonuses and occasionally penalties depending upon our achievement of certain client objectives.

During fiscal year 2025, the tightening in the global labor market and corresponding wage inflation, as well as increasing facilities expenses have resulted in us pursuing and successfully negotiating price increases or COLA with many of our clients.

During the fiscal year ended June 30, 2026, the tightening in the global labor market and corresponding wage inflation, as well as increasing facilities expenses have resulted in us pursuing and successfully negotiating price increases or COLA with many of our clients.

The current economic environment is also encouraging our clients to consider locating more of their support offshore.

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See “Item 7A.

Quantitative and Qualitative Disclosures about Market Risk.”

Quantitative and Qualitative Disclosures about Market Risk” for additional information on how foreign currency impacts our financial results.

Our business performance is subject to seasonal fluctuations.

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We define Capacity Utilization as the number of on-site workstations in use plus the number of work at home seats divided by the number of on-site workstations, for the period under consideration, across all facilities in the region.

This metric may help investors seeking to better understand how much room for revenue growth there is within the existing site footprint, as

well as what future needs to capital expenditures may be associated with a need to support revenue growth.

This metric may help investors seeking to better understand how much room for revenue growth there is within the existing site footprint, as well as what future needs to capital expenditures may be associated with a need to support revenue growth.

This metric also serves as a relative proxy for efficiency in terms of usage of existing space.

During fiscal year 2025, capacity utilization increased to 88% from 84% in the prior year as we continue to utilize capacity in nearshore and offshore geographies and optimize our onshore capacity.

During fiscal year 2026, capacity utilization remained consistent with 94% when compared to the prior year as we continue to utilize capacity in nearshore and offshore geographies and optimize our onshore capacity.

Capacity utilization was over 100% in the United States as we continued to migrate towards a work at home model.

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Workstations In Use Utilization %

Onshore 654 1,895 290 %

Offshore 15,245 13,622 89 %

Nearshore 5,806 4,808 83 %

United States 654 1,461 223 %

Total 21,705 20,325 94 %

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Workstations In Use Utilization %

Onshore 654 1,461 223 %

Offshore 12,625 11,856 94 %

Nearshore 7,177 4,596 64 %

United States 1,020 1,590 156 %

Total 20,456 17,913 88 %

Included in the In Use amounts and Utilization percentages above is the impact of our employees working remotely.

As of June 30, 2026, we had 1,655, 1,398, and 196 employees working remotely in our onshore, offshore, and nearshore regions, respectively.

As of June 30, 2025, we had 1,237, 1,714, and 337 and employees working remotely in our onshore, offshore, and nearshore regions, respectively.

Results of Operations

The following summarizes the results of our operations for the fiscal years ended June 30, 2026 and 2025:

Year ended June 30,

Year ended June 30, Period over Period Change

($000s) 2026 2025 ($) (%)

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Net income $ 46,331 $ 36,864 $ 9,467 25.7 %

Fiscal Years Ended June 30, 2025 and 2024

Our revenue was $558.3 million for the fiscal year ended June 30, 2025, an increase of $49.7 million, or 9.8%, compared to the prior year.

This increase was primarily driven by increases in our Retail & E-commerce vertical of $16.2 million, or 12.6%, HealthTech vertical of $15.5 million, or 23.2%, Travel, Transportation & Logistics vertical of $9.4 million, or 13.7%, and Other vertical of $20.3 million, or 37.6%, largely due to growth in our digital acquisition business, compared to the prior year.

These increases were partially offset by decreases in the FinTech vertical of $8.7 million, or 12.2% and Telecommunications vertical of $3.5 million, or 4.6%, compared to the prior year.

As a percentage of total revenue, the revenue from our Retail & E-commerce vertical increased to 26.0% for the fiscal year ended June 30, 2025 compared to 25.4% in the prior year, the revenue from our HealthTech vertical increased to 14.7% compared to 13.1%, the revenue from our Travel, Transportation & Logistics vertical increased to 13.9% compared to 13.4%, and the revenue from our Other vertical increased to 13.3% compared to 10.6%.

Conversely, the revenue from our FinTech vertical decreased to 11.2% for the fiscal year ended June 30, 2025 compared to 14.0% in the prior year, and the revenue from our Telecommunications vertical decreased to 13.1% compared to 15.0%.

Revenue was $644.1 million during the fiscal year ended June 30, 2026, an increase of $85.8 million, or 15.4%, compared to the prior year.

This increase was primarily driven by increases in our HealthTech vertical of $31.7 million, or 38.5%, Retail & E-commerce vertical of $20.5 million, or 14.1%, Travel, Transportation & Logistics vertical of $13.3 million, or 17.2%, Technology vertical of $11.1 million, or 25.6%, and Other vertical of $21.5 million, or 28.9%, due to growth in our digital acquisition business, compared to the prior year.

These increases were partially offset by a decrease in the Telecommunications vertical of $13.6 million, or 18.7%, compared to the prior year.

As a percentage of total revenue, our HealthTech vertical increased to 17.7% compared to 14.7%, our Technology vertical increased to 8.4% compared to 7.8%, and our Other vertical increased to 14.9% compared to 13.3% during the prior year.

Our Retail & E-commerce and our Travel, Transportation & Logistics verticals remained consistent at 25.7% and 14.1%, respectively, compared to the prior year.

Conversely, our Telecommunications vertical decreased to 9.2% during the fiscal year ended June 30, 2026 compared to 13.1% during the prior year.

Operating Expenses

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Cost of services was $456.2 million during the fiscal year ended June 30, 2026, an increase of $70.5 million, or 18.3%, compared to the prior year.

The increase in cost of services was primarily due to increases in payroll and related costs, reseller commissions and lead expenses, IT expenses, telecom, local transportation and other site related expenses, and stock-based compensation.

Payroll and related costs were $291.0 million during the fiscal year ended June 30, 2025, an increase of $16.6 million, or 6.0%, compared to the prior year, due to increased revenues during the current year.

As a percent of revenue, payroll costs decreased to 52.1% during the fiscal year ended June 30, 2025 compared to 54.0% during the prior year, reflecting our continuing trend towards lower cost regions.

The increase in cost of services was primarily due to increases in payroll and related costs, reseller commissions and lead expenses, facility, IT, local transportation and other site related expenses.

Payroll and related costs were $336.5 million during the fiscal year ended June 30, 2026, an increase of $45.4 million, or 15.6%, compared to the prior year, due to additional headcount to support increased revenues during the current year and severance costs of $0.9 million related to work transferring from nearshore to offshore delivery centers.

As a percent of revenue, payroll costs were 52.3% during the fiscal year ended June 30, 2026, consistent with the prior year.

Reseller commissions and lead expenses were $34.0 million during the fiscal year ended June 30, 2026, an increase of $13.3 million, or 64.0%, compared to the prior year.

These increases were primarily due to increases in the utilization of our third-party affiliates for inbound inquiries as well as search engine costs in connection with increased revenue in our higher margin digital sales and marketing efforts.

Facilities expenses were $54.9 million during the fiscal year ended June 30, 2026, an increase of $6.6 million, or 13.5%, compared to the prior year, primarily driven by expansions in our offshore regions.

IT expenses were $10.3 million during the fiscal year ended June 30, 2026, an increase of $3.5 million or 51.4%, compared to the prior year, primarily due to additional software license fees.

Telecom, local transportation and other site related expenses were $15.3 million during the fiscal year ended June 30, 2025, an increase of $1.7 million, or 12.2%, compared to the prior year, driven primarily by increased activity corresponding to our increased revenues during the current year.

Stock-based compensation was $0.5 million during the fiscal year ended June 30, 2025, an increase of $0.4 million compared to the prior year, primarily due to a higher share price impacting liability-based grants.

Local transportation and other site related expenses were $10.9 million during the fiscal year ended June 30, 2026, an increase of $1.7 million or 18.9%, compared to the prior year, driven primarily by site expansions in our offshore regions to support increasing revenues during the current year.

Selling, general, and administrative expense (“SG&A”)

SG&A expense was $113.0 million during the fiscal year ended June 30, 2026, an increase of $4.3 million, or 3.9%, compared to the prior year.

The increase was driven by higher payroll and related costs of $10.0 million due to higher performance-based incentives and new hires to support growth, stock-based compensation of $1.2 million primarily due to new grants issued and a higher share price impacting liability-based grants, IT expenses of $1.2 million due to continued investments in core business management systems and additional

software license fees, increased site related expenses of $0.9 million, driven by growth in our higher margin offshore regions, and increases in net foreign currency losses of $2.5 million year over year.

The increase was driven by higher payroll and related costs of $5.4 million due to higher performance-based incentives and new hires to support growth, higher stock-based compensation of $2.7 million primarily due to new grants issued during the current year, higher IT expenses of $1.4 million due to additional software license fees, and a net loss on lease termination $0.7 million related to the closure of two nearshore sites during the current year.

These increases were partially offset by favorable foreign currency impacts of $3.9 million, lower legal and professional expenses of $0.8 million, lower facility expenses of $0.5 million, and a gain of $0.2 million on asset disposals, compared to the prior year.

Additionally, during the fiscal year ended June 30, 2026, we recognized impairment losses of $1.1 million compared to $1.4 million in the prior year.

Depreciation and amortization expense (“D&A”)

D&A expense was $17.2 million during the fiscal year ended June 30, 2025, a decrease of $2.2 million or 11.5%, compared to the prior year.

The decrease was primarily due to lower depreciation expense due to an increase in fully depreciated assets.

As a percentage of revenue, D&A decreased to 3.1% during the fiscal year ended June 30, 2025 compared to 3.8% in the prior year.

D&A expense was $19.9 million during the fiscal year ended June 30, 2026, an increase of $2.7 million or 15.6%, compared to the prior year.

The increase was primarily due to new capital additions in our offshore regions partially offset by lower depreciation expense resulting from an increase in fully depreciated assets.

As a percentage of revenue, D&A for the fiscal year ended June 30, 2026 remained consistent with the prior year at 3.1%.

Income from operations

Income from operations was $55.0 million during the fiscal year ended June 30, 2026 compared to $46.6 million during the prior year.

The operating margin was 8.3% for the fiscal year ended June 30, 2025, up from 7.8% for the prior year.

The increase was primarily driven by margin expansion as we continued to realize growth in our higher margin offshore regions and realize site optimization efforts undertaken in the prior year.

The operating margin for the fiscal year ended June 30, 2026 was 8.5%, up from 8.3% during the prior year.

Interest income

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Interest expense

Interest expense during the fiscal year ended June 30, 2025 was $1.6 million, an increase of $1.1 million when compared to the prior year, and consisted of interest on borrowings of $0.6 million, interest on finance leases of $0.3 million, amortization of deferred debt issuance costs of $0.2 million, interest of $0.2 million on the TRGI convertible promissory note (as defined and described below), and a loss on extinguishment of $0.2 million related to the termination of our credit facility with PNC.

Interest expense during the fiscal year ended June 30, 2026 was $0.9 million, a decrease of $0.7 million, or 42.7% primarily due to lower interest on borrowings in the current year as well as expenses incurred during the prior year including the loss on extinguishment of $0.2 million related to the termination of our PNC Credit Facility and interest expense of $0.2 million on the convertible promissory note issued in connection with the purchase agreement with TRGI, which was repaid during fiscal 2025.

Provision for Income Taxes

Income tax expense was $9.1 million during the fiscal year ended June 30, 2025, an increase of $1.7 million when compared with the prior year, primarily due to a higher pre-tax income and a higher effective tax rate in the current year.

Income tax expense was $8.0 million during the fiscal year ended June 30, 2026, a decrease of $1.1 million, or 12.2%.

The effective tax rate was 14.7% and 19.7% for the fiscal years ended June 30, 2026 and 2025, respectively.

The changes in effective tax rates between these periods was primarily attributable to changes in revenue mix across our taxable jurisdictions and discrete items recorded during the prior year.

The changes in effective tax rates between these periods was primarily attributable to changes in revenue mix across our taxable jurisdictions and discrete tax benefits recognized in the current year.

Excluding the discrete tax benefits from stock-based compensation and favorable resolution of uncertain tax positions, our effective tax rate would have been 18.2% for the fiscal year ended June 30, 2026.

Non-GAAP Financial Measures

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We also use these measures internally to establish forecasts, budgets and operational goals to manage and monitor our business, as well as evaluate our underlying historical performance, as we believe that these non-GAAP financial measures provide a more helpful depiction of our performance of the business by encompassing only relevant and manageable events, enabling us to evaluate and plan more effectively for the future.

The non-GAAP financial measures may not be comparable to other similarly titled measures of other companies, have limitations as analytical tools, and should not be considered in isolation or as a substitute for analysis of our operating results as reported in accordance with accounting principles generally accepted in the United States (“U.S.

Non-GAAP financial measures and ratios are not measurements of our performance, financial condition or liquidity under U.S.

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Adjusted net income is a non-GAAP profitability measure that represents net income before the effect of the following items:

severance costs, impairment losses, warrant contra revenue, foreign currency gains and losses, and stock-based compensation expense, net of the tax impact of such adjustments.

severance costs, impairment losses, gains or losses on asset disposals, gains or losses on lease terminations, foreign currency gains and losses, and stock-based compensation expense, net of the tax impact of such adjustments.

We define adjusted net income margin as adjusted net income divided by revenue.

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The following table provides a reconciliation of net income to adjusted net income, net income margin to adjusted net income margin, and diluted earnings per share to adjusted earnings per share for the years presented:

Year ended June 30,

Year ended June 30, Period over Period Change

($000s, except per share amounts) 2026 2025 ($) (%)

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Impairment losses 1,092 1,429 (337) (23.6) %

Warrant contra revenue — 1,183

Foreign currency losses / (gains) 693 (1,815)

Gain on asset disposals (150) — (150) 100.0 %

Loss on lease terminations 744 — 744 100.0 %

Foreign currency (gains) / losses (3,177) 693 (3,870) (558.4) %

Stock-based compensation expense 7,737 5,432 2,305 42.4 %

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Tax impact of adjustments (1)

(1,650) (1,975) 325 (16.5) %

Adjusted net income $ 52,167 $ 43,001 $ 9,166 21.3 %

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Weighted average diluted shares outstanding 14,808 15,725 (917) (5.8) %

2 The tax impact of each adjustment is calculated using the effective tax rate in the relevant jurisdictions.

The period over period change and percentages are calculated based on exact amounts, and therefore may not recalculate exactly using rounded numbers as presented.

(1) Represents tax impacts of each adjustment using the effective tax rate in the relevant jurisdictions.

EBITDA, adjusted EBITDA, and adjusted EBITDA margin

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Adjusted EBITDA is a non-GAAP profitability measure that represents EBITDA before the effect of the following items:

severance costs, impairment losses, interest income, warrant contra revenue, foreign currency gains and losses, and stock-based compensation expense.

interest income, severance costs, impairment losses, gains or losses on asset disposals, gains or losses on lease terminations, foreign currency gains and losses, and stock-based compensation expense .

Adjusted EBITDA margin is a non-GAAP profitability measure that represents adjusted EBITDA divided by revenue.

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The following table provides a reconciliation of net income to EBITDA, and adjusted EBITDA and net income margin to a djusted EBITDA margin for the years presented:

Year ended June 30,

Year ended June 30, Period over Period Change

($000s) 2026 2025 ($) (%)

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EBITDA $ 75,152 $ 64,798 $ 10,354 16.0 %

Interest income (266) (955) 689 (72.1) %

Severance costs 1,240 558 682 122.0 %

Impairment losses 1,092 1,429 (337) (23.6) %

Interest income (955) (2,071)

Warrant contra revenue — 1,183

Foreign currency losses / (gains) 693 (1,815)

Gain on asset disposals (150) — (150) 100.0 %

Loss on lease terminations 744 — 744 100.0 %

Foreign currency (gains) / losses (3,177) 693 (3,870) (558.4) %

Stock-based compensation expense 7,737 5,432 2,305 42.4 %

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Adjusted EBITDA margin 12.8 % 12.9 % (0.1) % (0.8) %

The period over period change and percentages are calculated based on exact amounts, and therefore may not recalculate exactly using rounded numbers as presented.

Net income margin

Net income margin was 6.6% for the fiscal year ended June 30, 2025, consistent with 6.6% during the prior year.

Net income margin increased to 7.2% for the fiscal year ended June 30, 2026, compared to 6.6% during the prior year.

This increase was primarily driven by lower SG&A and income tax expenses as a percentage of revenue, partially offset by higher reseller commissions and lead expenses as a percentage of revenue, compared to the prior year.

Adjusted EBITDA margin

Adjusted EBITDA margin was 12.9% for t he fiscal year ended June 30, 2025, consistent with 12.8% during the prior year.

Adjusted EBITDA margin was 12.8% for t he fiscal year ended June 30, 2026, compared to 12.9% in the prior year.

Free cash flow

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The following table reconciles net cash provided by operating activities to free cash flow for the years presented:

Year ended June 30,

Year ended June 30, Period over Period Change

($000s) 2026 2025 ($) (%)

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Net cash provided by operating activities during the fiscal year ended June 30, 2026 was $59.0 million compared to $45.7 million during the fiscal year ended June 30, 2025.

The increase was primarily driven by an increase in revenue and a lower use of working capital.

Free cash flow during the fiscal year ended June 30, 2025 was $27.3 million, consistent with the prior year due to an increase in capital expenditures of $9.5 million.

The increase in capital expenditures during the current year was driven by expansions in our offshore regions and purchases of IT and telecommunications equipment.

The increase was primarily driven by an increase in revenue and profitability, offset by a higher use of working capital.

Free cash flow during the fiscal year ended June 30, 2026 was $31.2 million compared to $27.3 million during the fiscal year ended June 30, 2025.

The increase in net cash provided by operating activities was partially offset by the planned increase in capital expenditures during the current year of $9.4 million, which was primarily driven by $4.0 million related to facilities expansions in our offshore regions and $5.4 million related to purchases of IT and telecommunications equipment to support growth.

Net cash is a non-GAAP liquidity measure that represents cash and cash equivalents less total debt.

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Net cash is calculated below:

($000s) June 30,

2025 June 30,

($000s) 2026 2025 Period over Period Change

Cash and cash equivalents $ 32,566 $ 15,350 $ 17,216 112.2 %

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Net cash $ 30,907 $ 13,731 $ 17,176 125.1 %

The decrease in cash and cash equivalents and net cash as of June 30, 2025 is primarily due to the Company’s increased share repurchases and capital expenditures, offset by higher operating cash flow cash from operating activities, compared to the prior year.

JOBS Act Accounting Election

We qualify as an EGC pursuant to the provisions of the JOBS Act until, at the latest, our status expires on June 30, 2026.

The JOBS Act permits an EGC like us to take advantage of an extended transition period to comply with new or revised accounting standards applicable to public companies.

We have elected to use the extended transition period until we are no longer an EGC or until we choose to opt out of the extended transition period affirmatively and irrevocably.

As a result, our financial statements may not be comparable to companies that comply with new or revised accounting pronouncements applicable to public companies.

The increase in cash and cash equivalents and net cash as of June 30, 2026 is primarily due higher cash flow from operating activities and lower use of cash for financing activities, primarily due to the purchase agreement with TRGI during the prior year.

These increases were offset by an increase in planned capital expenditures during the fiscal year ended June 30, 2026 compared to the prior year.

Liquidity and Capital Resources

As of June 30, 2025, our principal sources of liquidity were cash and cash equivalents totaling $15.4 million, cash flows from operations, and the unused availability under our HSBC Credit Facilities (as defined and described in more detail below) of $71.4 million.

As of June 30, 2026, our principal sources of liquidity were cash and cash equivalents totaling $32.6 million, cash flows from operations, and the unused availability under our existing credit facilities with HSBC Bank USA, National Association and HSBC Bank Middle East Limited (“HSBC Credit Facilities”) of $63.6 million.

As of June 30, 2026, our total indebtedness was $1.7 million, consisting of our finance leases.

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Refer to Note 8, “Debt” in the consolidated financial statements included in this Form 10-K for additional information on our debt.

We use these resources to finance our operations, expand current delivery centers, open new delivery centers, invest in upgrades of technology, service offerings, and for other strategic initiatives, such as acquiring or investing in complementary businesses or intellectual property rights, or share repurchases.

Our future liquidity requirements will depend on many factors, including our growth rate and the timing and extent of spending to engage in the activities mentioned above.

We believe that our existing cash balance together with cash

generated from our operations will be sufficient to meet our liquidity requirements for at least the next twelve months.

To the extent additional funds are necessary to meet our long-term liquidity needs as we execute on our business strategy, we anticipate that they will be obtained through the utilization of current availability under our HSBC Credit Facilities (as defined and described below), additional indebtedness, additional equity financings or a combination of these potential sources of funds;

We believe that our existing cash balance together with cash generated from our operations will be sufficient to meet our liquidity requirements for at least the next twelve months.

To the extent additional funds are necessary to meet our long-term liquidity needs as we execute on our business strategy, we anticipate that they will be obtained through the utilization of current availability under our HSBC Credit Facilities, additional indebtedness, additional equity financings or a combination of these potential

sources of funds;

however, such additional financing may not be available on favorable terms, or at all.

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The Board may authorize share repurchases of the Company’s common shares and the Company had multiple share repurchase plans during the fiscal years ended June 30, 2026 and 2025.

On May 1, 2025, the Board authorized the Company’s current share repurchase program, which commenced on May 12, 2025, of $15 million in share repurchases for the next twelve months.

On May 11, 2026, the Board authorized $20 million in share repurchases for the next twelve months.

For the years ended June 30, 2026 and 2025, the Company repurchased 452,758 and 385,510 shares, respectively, of its common shares totaling $14.4 million, and $7.2 million, respectively.

All repurchases under these programs were funded with our existing cash balance.

During the prior year , the Company also entered into a purchase agreement with The Resource Group International Limited ("TRGI"), pursuant to which the Company purchased from TRGI 3,562,341 common shares of the Company for an aggregate price of $70 million, which was fully paid in cash during the year ended June 30, 2025.

The following discussion highlights our cash flow activities durin g the last two fiscal years:

Year ended June 30,

Year ended June 30, Period over Period Change

($000s) 2026 2025 ($) (%)

Net cash inflow / (outflow) from

Operating activities $ 45,668 $ 35,900

Investing activities (18,375) (8,855)

Financing activities (74,660) (21,733)

Effects of exchange rate difference on cash and cash equivalents (3) (21)

Net (decrease) / increase in cash and cash equivalents $ (47,370) $ 5,291

Cash and cash equivalents at beginning of the period 62,720 57,429

Cash and cash equivalents at the end of the period $ 15,350 $ 62,720

Net cash inflow from operating activities $ 59,001 $ 45,668 $ 13,333 29.2 %

Net cash outflow from investing activities (27,807) (18,375) (9,432) 51.3 %

Net cash outflow from financing activities (13,927) (74,660) 60,733 (81.3) %

Cash and cash equivalents at the end of the year $ 32,566 $ 15,350 $ 17,216 112.2 %

Cash and cash equivalents

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dollars and outside of the U.S.

dollars and foreign currencies in regional or local banks in the countries it operates in.

dollars and foreign currencies in regional or local banks it operates in.

The Company believes that its cash management policies and practices effectively mitigate its risk relating to its global cash.

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As of June 30, 2025, we had cash and cash equivalents of $15.4 million, including $12.0 million located outside of the United States, and $2.7 million that is subject to certain local regulations on repatriation.

The decrease in our cash position as of June 30, 2025 is primarily due to the Company’s increased expenditures on share repurchases and capital expenditures, partially offset by higher operating cash flow cash from operating activities, compared to the prior year.

The increase in our cash position as of June 30, 2026 is primarily due to higher cash flow from operating activities during the current year, partially offset by increased capital expenditures compared to the prior year.

During the prior year, the Company also incurred significant cash outflows from financing activities in connection with the repurchase agreement with TRGI.

Cash Flows from Operating Activities

Net cash inflow from operating activities during the fiscal year ended June 30, 2025 was $45.7 million compared to $35.9 million during the fiscal year ended June 30, 2024.

The increase was primarily driven by an increase in our revenues driving improved profitability and a lower use of working capital.

Net cash inflow from operating activities during the fiscal year ended June 30, 2026 increased to $59.0 million from $45.7 million in the prior year, which was driven by an increase in our revenues and profitability, offset by a higher use of working capital.

Cash Flows from Investing Activities

During the year ended June 30, 2025, we incurred expenditures of $18.4 million on investing activities primarily driven by expansions in our offshore regions to meet demand and purchases of IT and telecommunications equipment.

During the year ended June 30, 2024, we had expenditures of $8.9 million on investing activities primarily related to purchases of IT and telecommunications equipment, and capacity expansion in Pakistan.

During the fiscal years ended June 30, 2026 and 2025, we incurred expenditures of $27.8 million and $18.4 million, respectively, on investing activities.

The net increase in cash used in investing activities of $9.4 million was primarily driven by an increase of $4.0 million related to expansions in our offshore regions and $5.4 million related to purchases of IT and telecommunications equipment to support the Company’s continued growth, when compared to the prior year.

Cash Flows from Financing Activities

During the year ended June 30, 2025, we expended a total of $74.7 million on financing activities, of which $78.0 million related to purchases our common shares, offset by $4.3 million in stock option proceeds.

During the year ended June 30, 2024, we expended a total of $21.7 million on financing activities, of which $21.6 million related to purchasing our common shares under the share repurchase programs.

During the fiscal years ended June 30, 2026 and 2025, we expended $13.9 million and $74.7 million, respectively, on financing activities.

The net decrease in cash used in financing activities of $60.7 million was primarily driven by a decrease in share repurchase activities of $63.6 million, partially offset by increased payments for taxes related to net share settlement of equity awards of $2.3 million, lower cash receipts from stock transactions of $0.3 million, and higher principal payments on our finance leases of $0.3 million, when compared to the prior year.

Our cash resources could also be affected by various risks and uncertainties.

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The following is a summary of our principal financing arrangements.

PNC Credit Facility

In November 2013, the Company’s subsidiary, Ibex Global Solutions, Inc.

entered into an agreement, as amended, with PNC Bank, National Association (“PNC”), for a revolving credit facility (“PNC Credit Facility”).

The PNC Credit Facility provided a maximum revolving advance amount of $80 million.

The PNC Credit Facility was terminated and repaid in full on October 29, 2024, and replaced by the HSBC Credit Facilities (as defined below).

In connection with the termination of the PNC Credit Facility, the Company recognized a loss on extinguishment of $0.2 million during the year ended June 30, 2025.

HSBC Credit Facilities

Credit Agreement

On the Effective Date, the Company's subsidiaries, Ibex Global Solutions, Inc.

On October 29, 2024 (the “Effective Date”), the Company's subsidiaries, Ibex Global Solutions, Inc.

("Ibex US") and Digital Globe Services, LLC, as borrowers, together with the Company and Ibex Global Limited, as guarantors, and the other loan parties and guarantor parties party thereto from time to time, entered into a credit agreement with HSBC Bank USA, National Association ("HSBC U.S.") (the “U.S.

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Credit Facility”).

Credit Facility matures on the earlier of October 29, 2027 and the termination or maturity of the obligations under the UAE Credit Agreement (as defined and described below).

Credit Facility matures on the earlier of October 29, 2027 and the termination or maturity of the obligations under the UAE Credit Agreement (as defined below).

Borrowings under the U.S.

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and (iv) a letter of deviation (collectively, the “UAE Credit Agreement”), in each case, with HSBC Bank Middle East Limited ("HSBC UAE”).

The UAE Credit Agreement provides for a committed $50 million post shipment seller revolving loan credit facility (the “UAE

Loan Facility”) and a $50,000 credit card facility (the “Commercial Card Facility” and collectively with the UAE Loan Facility, the “UAE Facilities”).

The UAE Credit Agreement provides for a committed $50 million post shipment seller revolving loan credit facility (the “UAE Loan Facility”) and a $50,000 credit card facility (the “Commercial Card Facility” and collectively with the UAE Loan Facility, the “UAE Facilities”).

The final repayment date for the UAE Credit Agreement is two years from the Effective Date.

The UAE Loan Facility is secured by the accounts receivable of the UAE Company and an irrevocable and unconditional guarantee provided by the Company in favor of HSBC UAE with respect to all monies and liabilities owing or incurred by the UAE Company to or in favor of HSBC UAE.

On May 22, 2025, the FOL was amended to add an additional $119,809 to the UAE Facilities for bid and performance bond guarantees issued by HSBC UAE (“Bond Guarantees”).

In May 2025 and May 2026, the FOL was amended to add a total of $255,957 to the UAE Facilities for bid and performance bond guarantees issued by HSBC UAE (“Bond Guarantees”).

The Bond Guarantees are secured by cash collateral provided by the UAE Company.

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The Commercial Card Facility is subject to HSBC UAE’s standard commercial card terms and conditions.

The Bond Guarantees are subject to HSBC UAE’s standard terms and conditions.

The U.S Credit Agreement and UAE Credit Agreement contain certain financial and non-financial covenants, including, among other things, covenants in respect of a total net leverage ratio, fixed charge coverage ratio, and restrictions on incurring additional debt and liens, making certain restricted payments and investments, engaging in certain transactions with affiliates, and disposal of assets.

The Bond Guarantees are subject to HSBC UAE’s standard commercial terms and conditions.

The HSBC Credit Facilities contain certain financial and non-financial covenants, including, among other things, covenants in respect of a total net leverage ratio, fixed charge coverage ratio, and restrictions on incurring additional debt and liens, making certain restricted payments and investments, engaging in certain transactions with affiliates, and disposal of assets.

As of June 30, 2026, the Company did not have any outstanding balances on the HSBC Credit Facilities.

In connection with the HSBC Credit Facilities, the Company deferred debt issuance costs of $0.9 million, which are included in other current assets and other non-current assets in the consolidated balance sheets as of June 30, 2025.

In connection with the HSBC Credit Facilities, the Company had deferred debt issuance costs of $0.5 million as of June 30, 2026, which are included in other current assets and other non-current assets in the consolidated balance sheets.

Contractual obligations

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Future capital requirements

We expect capital expenditures in fiscal year 2026 to be between 3.0% and 4.0% of revenue.

Because we have heavily invested in capacity expansion and growth over the last few years, we are expecting approximately 50% of fiscal year 2026 capital expenditures will be directed to additional growth in the business while 50% will be directed towards maintenance of existing assets.

We expect capital expenditures in fiscal year 2027 to be between $25 million and $30 million or approximately 3.5% and 4.5% of revenue to meet our growth requirements, with slightly more than 50% for additional capacity expansion and the remainder for additional investments to our existing facilities and infrastructure.

Our capital expenditure requirements could increase materially in the event of an acquisition or the launch of large new client contracts, which generally require increased capital expenditures for equipment and working capital to support hiring and training activities.

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Preparation of these financial statements requires the Company to make estimates, assumptions and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities.

The Company’s most critical accounting estimates are those most important to the portrayal of its financial condition and results of operations which require the Company to make its most difficult and subjective judgments, often as a result of the need to make estimates regarding matters that are inherently uncertain.

judgments, often as a result of the need to make estimates regarding matters that are inherently uncertain.

The Company has identified the following as its most critical accounting estimates.

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Warrant to purchase common shares

The Company accounts for a warrant to purchase its common shares as an equity instrument in accordance with the provisions of Accounting Standards Update (“ASU”) No.

2019-08, Compensation – Stock Compensation (Topic 718) and ASC 606, Revenue from Contracts with Customers, which requires entities to measure and classify stock-based payment awards granted to a customer by applying the guidance under Topic 718, as of January 1, 2019.

On the grant date, the Company estimated the value of the warrant using a Black-Scholes option pricing model.

The Company accounts for a warrant to purchase its common shares (“Warrant”) as an equity instrument in accordance with the provisions of Accounting Standards Update (“ASU”) No.

On the grant date, the Company estimated the value of the Warrant using the Black-Scholes option pricing model.

The assumptions used in our Black-Scholes model were (1) expected term, which was estimated based on the term of the Warrant, (2) the risk-free interest rate which is based on the U.S.

Treasury yield curve, (3) expected volatility which we estimated based on peer group volatility, and (4) an expected dividend yield based on our anticipated future dividends on our common stock (estimated at zero).

These estimates all have an impact on the value attributed to the Warrant.

At each reporting period, the Company assesses the likelihood of additional vesting in accordance with service or performance conditions included in the warrant terms.

The Company adjusts its estimates for additional contra-revenue when it is probable that additional shares will vest.

The timing of any additional estimated vesting and the related fair value at the time of the change in estimate could have a material impact on the transaction price and therefore revenue recorded related to the Amazon contract.

The vesting period ended June 30, 2024.

The Company assessed the likelihood of additional vesting in accordance with service or performance conditions included in the terms of the Warrant, and recorded contra-revenue and equity at the end of each reporting period.

The vesting period ended on June 30, 2024.

The Company has elected a policy to estimate forfeitures for non-employee equity grants.

Stock-based compensation plans

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The assumptions used in our Black-Scholes model are (1) expected term, which was estimated based on the simplified method as we do not have requisite historical data, (2) the risk-free interest rate which is based on the U.S.

Treasury yield curve, (3) expected volatility which we estimate based on peer group volatility, and (4) an expected dividend yield based on our anticipated future dividends on our common stock (currently estimated at zero).

The Company has certain restricted stock units with service and market conditions (“TSR Awards”) and calculates the fair value of these awards using a Monte Carlo model.

The assumptions used in our Monte Carlo

model are (1) remaining performance period based on the remaining period at time of the grant, (2) the risk-free interest rate which is based on the U.S.

Treasury yield curve, (3) expected volatility based on the historical stock price volatility of the Company with a look back period commensurate with a term of the award, and (4) an expected dividend yield based on our anticipated future dividends on our common stock (currently estimated at zero).

The Company has certain restricted stock units, which are subject to service and market conditions (“TSR Awards”) and calculates the fair value of these awards using a Monte Carlo model.

The assumptions used in our Monte Carlo model are (1) weighted-average remaining performance period based on the remaining period at time of the grant, (2) the risk-free interest rate which is based on the U.S.

Treasury yield curve, (3) expected volatility based on the historical stock price volatility of the Company with a look back period commensurate with

the term of the award, and (4) an expected dividend yield based on our anticipated future dividends on our common shares (currently estimated at zero).

Changes in any of the estimates mentioned above could have a material impact on the stock-based compensation expense recorded in any period.

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Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.

Deferred tax assets are also recognized for the estimated future effects of tax loss carry forwards.

Deferred tax assets are also recognized for the estimated future effects of tax loss carryforwards.

The effect of changes in tax rates on deferred taxes is recognized in the period in which the enactment dates change.

We recognize deferred tax assets to the extent that we determine that these assets are more likely than not to be realized.

In making such a determination, we consider all available positive and negative evidence, including future reversals of existing temporary differences, projected future taxable income, tax-planning strategies, carryback potential if permitted under the tax law, and results of recent operations.

In making such a determination, we consider the available positive and negative evidence, including future reversals of existing temporary differences, projected future taxable income, tax-planning strategies, carryback potential if permitted under the tax law, and results of recent operations.

The Company records valuation allowances against its deferred tax assets based on whether it is more likely than not that the deferred tax assets will be realized.

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Changes in recognition or measurements are reflected in the period in which the change in estimate occurs.

Public Law No:

119-21, the One Big Beautiful Bill Act (the “Act”) was signed on July 4, 2025, which marks the date of enactment for the tax provisions included in the Act.

The Company is evaluating the impact of this enactment.

Commitment and Contingencies

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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-K

Item 7. Management’s Discussion and Analysis