Globant Trims Its 2026 Outlook as North America Shrinks — and Points at a $52.8 Million AI Line to Explain Why It Isn't Worried

by Carter Whitfield · August 14, 2026

Equities Reporter, The SmallCap Signal

Globant S.A. (NYSE: GLOB) reported second-quarter 2026 results after Thursday's close — the company's release accompanied a video conference call it said began at 4:30 p.m. ET on Aug. 13 — and lowered its full-year revenue guidance, in a print that separated cleanly into two stories: a core services business that is no longer growing, and a small, fast-compounding artificial-intelligence product line that management spent most of its commentary on. Quarterly revenue was $614.4 million, flat against a year earlier and within the range the company had guided to. Diluted earnings per share were $0.04 on an IFRS basis, against negative $0.05 a year earlier; on an adjusted, non-IFRS basis the company reported $1.40 per diluted share, down from $1.53.

Margins narrowed. IFRS gross margin came in at 33.9 percent, down from 35.4 percent a year earlier, and adjusted gross margin at 36.5 percent against 38.1 percent, while adjusted operating margin fell to 13.2 percent from 15.0 percent, per the company's results release. On the earnings call management tied the gross-margin compression to two things rather than one: currency, and utilization running below target. It described adjusted gross margin as slightly down as dollar weakness accelerated, which primarily affected Colombia, its largest delivery center. Chief financial officer Juan Urthiague characterized the Colombian peso's appreciation since the country's presidential election as having had a massive impact, and put the cumulative drag from Latin American currencies over the past 18 months to two years at roughly four percentage points. Adjusted operating margin of 13.2 percent came in below the company's own guided range. Globant ended the quarter with $168.8 million in cash and short-term investments and 27,411 employees, of whom 25,632 are classified as technology, design and innovation professionals.

The guidance cut is the part that moved the stock. Globant now expects full-year 2026 revenue of $2.428 billion to $2.462 billion, a range that spans a 1.1 percent decline to 0.3 percent growth, down from the prior $2.462 billion to $2.508 billion. Third-quarter revenue is guided to $607 million to $615 million, implying a year-over-year change of negative 1.6 percent to negative 0.3 percent, with adjusted operating margin of 13.5 percent to 14.5 percent for both the quarter and the year and adjusted diluted EPS of $1.43 to $1.53 for the third quarter. This is the first time Globant has actually reduced its 2026 range: the initial guidance issued alongside fourth-quarter 2025 results on Feb. 26 was $2.460 billion to $2.510 billion, and the range set with first-quarter results on May 14, at $2.462 billion to $2.508 billion, narrowed the band without moving its midpoint. In plain terms, the company is now telling investors to expect a full year that is flat at best.

The regional breakdown explains where the shortfall sits. North America accounted for 52.8 percent of second-quarter revenue and, per the figures in the company's results presentation as summarized by Investing.com, declined 2.4 percent year over year, while the new-markets segment fell 17.7 percent. Europe grew 6.8 percent and Latin America 5.9 percent. Needham, reviewing the quarter, pointed to deterioration in new markets, softness among travel clients and slower client decision cycles as the drivers of the weaker outlook, and noted that the company has flagged a business-optimization effort aimed at a leaner cost base entering fiscal 2027. Management said on the call that it recorded a one-time charge of $32.3 million in the second quarter and expects a further $20 million to $25 million in charges before the effort is completed by year-end. Revenue per head rose 9.7 percent year over year to $95,800, according to Needham's note.

Against that, management leaned hard on Glob.AI, the platform through which the company sells what it calls AI Pods — packaged agentic delivery units priced on output rather than hours. "Glob.AI ARR reached $52.8 million in the second quarter, up 61% quarter-over-quarter, and we now expect no less than $110 million exiting 2026," said Martín Migoya, chief executive and co-founder, in the earnings release. Two sentences later in the same statement he turned to distribution: "Last week we opened Glob.AI to the entire market, a single platform where any enterprise can deploy AI Pods and pay on the output or consumption they receive rather than on the hours behind it." He went on to name partnerships with Anthropic, Vercel and OpenAI as supporting that shift. The $110 million exit target is an increase from a prior range of $60 million to $100 million, per Needham's recap.

Scale is the caveat. AI Pods account for roughly 2 percent of total revenue today and management expects about 4 percent by year-end, with a commercial pipeline of $436.8 million and adoption at 45 percent of the company's top-20 accounts, per the results presentation. Management told analysts gross margins on the model run close to 10 percentage points above traditional delivery. But a line growing at that rate off that base cannot yet offset a core business that is contracting in its largest region — which is precisely the tension the guidance range describes. The company reported 331 accounts generating more than $1 million in annual revenue in the twelve months ended June 30, and the results presentation shows 20 accounts above $20 million.

Urthiague framed the quarter around execution and cost discipline rather than growth. "In the second quarter of 2026, Globant demonstrated resilient execution, generating $614.4 million in revenue—within our guided range—and delivering record free cash flow generation for the first half of the year," he said in the release. He continued: "Expansion across our top accounts remained strong, reflecting a 6.9% year-over-year increase in our top 50 clients alongside accelerating market adoption of our higher-margin AI Pods and Glob.AI platform." His statement closed on the cost side rather than the growth side: "To navigate broader market volatility and to align with our business model transformation needs, we proactively optimized our structure during the quarter, all while we continued executing on our share repurchase program." Free cash flow was $12.6 million in the quarter against negative $2.9 million a year earlier, and the company said it completed $25.0 million of repurchases with $125.0 million of authorization remaining.

The share reaction was sharp, though it should be read as an extended-hours quote rather than a settled price. Globant closed Thursday's regular session at $40.99, up $2.25 or 5.81 percent on the day, which put its market capitalization at roughly $1.80 billion across 43,835,604 shares outstanding, per WallStreetZen data as of Aug. 13. Benzinga, in a stocks-to-watch roundup timestamped 2:08 a.m. ET Friday, described the stock as down 13.6 percent at $35.43 in the after-hours session — a move measured against that $40.99 Thursday close. No Friday regular-session price existed at the time of writing. The 52-week range on the WallStreetZen data was $27.56 to $72.10, a spread that captures how much of the market's original growth assumption has already come out of the name.

For the smaller end of the IT services group, the read-through is less about Globant's specific execution than about what the quarter says about the demand mechanism. The company is describing enterprise clients who are signing smaller, slower deals while they work out how much outside engineering capacity generative AI lets them do without — and simultaneously trying to sell those same clients an output-priced AI product that would, if it works, capture the value that leaks out of the hourly model. Whether that substitution nets out positive for a services vendor is an open question that this quarter does not answer; it establishes only that the core line is flat, the largest region is shrinking, the restructuring bill is still being paid, and the replacement line is small. Globant is a Luxembourg-domiciled company whose shares trade on the New York Stock Exchange, and at roughly $1.8 billion of market value it sits in the same size band as the domestic small- and mid-cap services names watching the same demand signal.