Information Services Group, Inc. · NASDAQ:III
Information Services — Q2 2025 Earnings Presentation
34 slides from Information Services's earnings presentation, Jul 10, 2025
Slide 1: Technology Industry Update: Services & Software 2Q 2025
Technology Industry Update: Services & Software July 10, 2025 HOSTED BY: 2Q 2025 Moshe Katri Managing Director, Investment Banking Wedbush Securities © 2025 Information Services Group, Inc. All Rights Reserved. Proprietary and Confidential. No part of this document may be reproduced in any form or b
Slide 2: Market Level Set
Market Level Set Managed services growth remains steady: up 3% YTD, flat Q/Q. First half BFSI up in U.S., down in EMEA; down Q/Q in both regions. Large deal activity remains robust; “discretionary” deals under pressure. Cloud growth continues to accelerate on strong demand for AI. Forecasting high e
Slide 3: Global Broader Market
Global Broader Market ACV $B Q/Q Results 18.4 18.6 10.6 10.6 29.0 29.2 14.6 Market largely flat indicating 24.9 softness and delayed decision- 10.3 making due to macroeconomic conditions 2Q 1Q 2Q 2Q 1Q 2Q 2Q 1Q 2Q 24 25 25 24 25 25 24 25 25 Q2 and 1H Results Broad-based growth across all three marke
Slide 4: Large Deal Activity Strong, While Discretionary Remains Weak
Large Deal Activity Strong, While Discretionary Remains Weak Mega Award ACV, Number Small Awards, 1H24 vs. 1H25 1H24 vs. 1H25 2.0 Mega award 817 1.8 ACV up 15% 735 Small award counts down 10% 1H24 1H25 1H24 1H25 Mega relationships remain Pullback in smaller deals across all robust; indicator that co
Slide 5: Managed Services ITO Results
Managed Services ITO Results 2Q25 Results ACV $B 1H24 1H25 ITO ACV of $7.8B down 0.4% Americas 8.8 24% 16.1 1H25 Results 14.7 14.9 ITO ACV up 8.2% while number EMEA 6.1 Flat of awards up 1.7% 8.2% Americas up 24%, EMEA flat YTD ADM 9.6 11.5% ADM up 11.5% and remains almost 60% of the ITO ACV 1H23 1H
Slide 6: Managed Services Engineering Results
Managed Services Engineering Results 2Q25 Results ACV $B Engineering ACV by Region ER&D ACV of $1.1B up 72% Asia ER&D responsible for most of the industry’s growth in Q2 1.9 Americas EMEA 1.4 1H25 Results ER&D ACV of $1.9B up 31% 1.0 31% Engineering ACV by Industry YTD Americas and EMEA regions Othe
Slide 7: Large Providers Are Driving Engineering Growth
Large Providers Are Driving Engineering Growth 1H25 Engineering ACV by Provider Type Large integrated providers account for nearly 60% of 1H25 ACV; pure plays Pure account for just over 40%. Play Provider Large Larger firms are benefitting from: Integrated Provider • Diversified business mix • Stron
Slide 8: Managed Services BPO Results
Managed Services BPO Results 2Q25 Results ACV $B BPO ACV of $1.7B down 9% BPO Customer Experience EMEA up 23%; Americas down 1H Results 1H Results 20% Back office (HR, F&A, 4.7 1.3 4.3 procurement) up 28% Y/Y 3.2 0.8 0.7 1H25 Results BPO down 25%, primarily due to 25% 9% 1H 1H steep decline in 1Q25
Slide 9: What's Happening in Customer Experience?
What’s Happening in Customer Experience? Generative AI fueling interest in CX; expectations are increasing. Platforms and reusable assets disrupting traditional agent services. Limited agent hiring; most new skills focus on data and analytics. Providers using M&A to build scale & capabilities; drivi
Slide 10: Managed Services Regional Results
Managed Services Regional Results ACV $B Americas 5.5 5.9 2Q: ACV up 20%; 5 mega deals 4.9 4.4 4.1 3.9 1H: ACV up 11%; BFSI up 20% 1.4 0.8 0.8 EMEA 2Q 1Q 2Q 2Q 1Q 2Q 2Q 1Q 2Q 2Q: ACV down 5%; 3 mega deals 24 25 25 24 25 25 24 25 25 1H: ACV up 3%; France, Nordics and DACH up; UK down more than 20% As
Slide 11: Sovereign Cloud: Future Growth Segment
Sovereign Cloud: Future Growth Segment Demand from public sector and industrial AI workloads is driving sovereign cloud interest across Europe for IaaS and SaaS. EMEA IaaS up 41% Y/Y and 13% Q/Q, the fastest regional growth rate globally; highlights ongoing enterprise shift to private and public clo
Slide 12: Managed Services Selected Industry Results
Managed Services Selected Industry Results ACV $B BFSI 2Q: ACV of $2.7B up 8% 3.1 2.5 2.7 1H: ACV up 5% on strength in Americas; demand for integrated tech + ops 1.1 1.1 0.9 1.0 0.7 0.9 Energy 2Q 1Q 2Q 2Q 1Q 2Q 2Q 1Q 2Q 24 25 25 24 25 25 24 25 25 2Q: ACV of $1.1B up 20% 1H: ACV up 24% on strength in
Slide 13: SaaS Results
SaaS Results 1H Results Global SaaS Regional SaaS SaaS market ACV advanced 12% in Market ACV Markets Growth first half to $8.5B Strong 1H growth, narrowly 8.5 7.7 7.6 Americas 8% outpacing 1H24 Each of the regional markets 12% 1H EMEA 20% contributed to the ACV growth with EMEA leading at 20% Energy
Slide 14: Key Trends in Applications (SaaS)
Key Trends in Applications (SaaS) Applications (i.e., Oracle, Salesforce) had 9% Y/Y ACV growth with continued AI investments, M&A news of Salesforce to buy Informatica. Front-office application & suites in CRM (i.e., Salesforce) with -8% Y/Y ACV decline as enterprises re-evaluate strategy for AI mo
Slide 15: IaaS Results
IaaS Results 1H Results Global IaaS Regional IaaS 1H25 ACV of $28.6B continued Market ACV Markets Growth annual growth since ‘23 Americas and EMEA led growth Americas 42% 28.6 with both up 40%+ ACV YTD Asia Pacific has solid 17%+ ACV 21.3 19.0 34% growth EMEA 41% 1H Retail & BFSI generated 48%+ ACV
Slide 16: Key Trends in Infrastructure (IaaS)
Key Trends in Infrastructure (IaaS) Growth of IaaS with 34% ACV Y/Y led by cloud hyperscalers (i.e., AWS, Azure) with native AI and data platforms, and agentic AI advancements. Big 3 hyperscalers (i.e., AWS, Azure, GCP) significant 40% ACV Y/Y growth with growth from Agentic and GenAI enterprise inv
Slide 17: ISG Global Service & Software Provider Standouts
Global Service & Software Provider Standouts THE ISG 15 Our ISG Contracts Database is used to determine The Big 15 placements based on the annual value of commercial contracts awarded in the past 12 months. The Building 15 The Breakthrough 15 The Booming 15 2Q25 © 2025 Information Services Group, In
Slide 18: Service & Software Provider Standouts – Global
Service & Software Provider Standouts – Global The ISG Contracts Database is used to determine placements based on the annual value of commercial contracts awarded in the past 12 months. The Big 15 The Building 15 The Breakthrough 15 The Booming 15 Revenues > $10B Revenues $3B-$10B Revenues $1B-$3B
Slide 19: Information & Technology
Information & Technology BPO Services Actions / Agentic AI Insights / Analysis Apps The information/ The Data Engineering / Semantics Platforms data that is in technology the technology itself Data / Information Infra Data Tower ITO 19 | 2Q25 © 2025 Information Services Group, Inc. All Rights Reserv
Slide 20: Productivity Has Prerequisites
Productivity Has Prerequisites Key Trends Legal and regulatory Data security Performance is best in areas where compliance Data there are known best practices and backup/disaster criteria. recovery Business value from Performance insights reporting Core-enabling activities still nascent, Responsible
Slide 21: Industry Challenges – Variety Abounds
Industry Challenges – Variety Abounds Chemicals/ Retail/ Travel, Tour, BFSI Healthcare Manufacturing Energy Consumer Hospitality 1st Data usability for AI applications Measuring ROI on data investments Data usability for AI applications Data usability for AI applications Data usability for AI applic
Slide 22: Top Talent Challenges
Top Talent Challenges AI Skills Talent Acquisitions Upskilling 33% 30% 21% 60% plan to add service providers to support data initiatives. Source: ISG Market Lens 2025 Data Programs Study 22 | 2Q25 © 2025 Information Services Group, Inc. All Rights Reserved.
Slide 23: Summary and Outlook
Summary and Outlook Summary Market Outlook Managed Services Macro Recap • ACV up nearly 3%, led by growth in Americas and EMEA. • Improving macro from 90 days ago, but uncertainty persists with • ITO up 8% as deals remain cost-takeout driven with savings re- concerns around trade/geopolitics. alloca
Slide 24: Thank you!
The 91 Quarterly st Thank you! © 2025 Information Services Group, Inc. All Rights Reserved.
Slide 25: Index Insider Weekly Briefing
Index Insider Weekly Briefing Subscribe to the ISG Index Insider to stay on top of what's important in the IT & Stanton Jones Alex Bakker business services industry. Delivered to your inbox every Friday from the ISG Market Lens Team. Michael Dornan Sunder Sarangan https://isg-one.com/research/isg-in
Slide 26: Appendix
Appendix © 2025 Information Services Group, Inc. All Rights Reserved.
Slide 27: Industry Verticals
Industry Verticals Consumer Travel, 1H25 Business Packaged Goods Financial Healthcare Telecom Transport Trends Services & Retail Energy Services & Pharma Manufacturing & Media Leisure Combined Market 25% 21% 23% 14% 15% 19% 1% 29% Managed Services -14% -7% 24% 5% 4% 9% -29% 41% As-a-Service 39% 34%
Slide 28: Americas Broader Market Results
Americas Broader Market Results ACV $B 1H25 Trends Combined market ACV surpassed 14.6 15.5 12.3 $15B for the first time ever 9.1 9.6 7.5 4.9 5.5 5.9 Managed services ACV up 20%; highest growth rate since 3Q23 2Q 1Q 2Q 2Q 1Q 2Q 2Q 1Q 2Q 24 25 25 24 25 25 24 25 25 Five mega-deals awarded, up 25% Y/Y S
Slide 29: Service & Technology Provider Standouts – Americas
Service & Technology Provider Standouts – Americas The ISG Contract KnowledgeBase™ is used to determine placements based on the annual value of commercial contracts awarded in the past 12 months. The Big 15 The Building 15 The Breakthrough 15 The Booming 15 Revenues > $10B Revenues $3B-$10B Revenues
Slide 30: EMEA Broader Market Results
EMEA Broader Market Results ACV $B Quarterly Trends Combined Market ACV pulled back slightly 9.2 9.0 7.9 Q/Q 4.4 3.9 4.8 5.1 4.1 3.8 Managed Services ACV fell below $4B for second time in last five quarters 2Q 1Q 2Q 2Q 1Q 2Q 2Q24 1Q 2Q 24 25 25 24 25 25 25 25 Six of the past eleven quarters have see
Slide 31: Service & Technology Provider Standouts – EMEA
Service & Technology Provider Standouts – EMEA The ISG Contract KnowledgeBase™ is used to determine placements based on the annual value of commercial contracts awarded in the past 12 months. The Big 15 The Building 15 The Breakthrough 15 The Booming 15 Revenues > $10B Revenues $3B-$10B Revenues $1B
Slide 32: Asia Pacific Broader Market Results
Asia Pacific Broader Market Results ACV $B Quarterly Trends Combined market ACV dipped below 5.4 4.7 4.7 4.6 3.9 $5B level for first time in a year 1.4 3.3 0.8 0.8 Managed services ACV of $823M, down 40% against a record high 2Q 1Q 2Q 2Q 1Q 2Q 2Q 1Q 2Q 24 25 25 24 25 25 24 25 25 2Q24 Pullback in sma
Slide 33: Service & Technology Provider Standouts – Asia Pacific
Service & Technology Provider Standouts – Asia Pacific The ISG Contract KnowledgeBase™ is used to determine placements based on the annual value of commercial contracts awarded in the past 12 months. The Big 15 The Building 15 The Breakthrough 15 The Booming 15 Revenues > $10B Revenues $3B-$10B Reve
Slide 34: isg-one.com
ISG (Information Services Group) (Nasdaq: III) is a leading global technology research and advisory firm. A trusted business partner to more than 900 clients, including more than 75 of the world’s top 100 enterprises, ISG is committed to helping corporations, public sector organizations, and service
Information Services Group — Q2 2025 Earnings Presentation on 6ix