CI&T Inc (NYSE:CINT) Q1 2026 Earnings Call Transcript

CI&T Inc (NYSE:CINT) Q1 2026 Earnings Call Transcript May 11, 2026

CI&T Inc misses on earnings expectations. Reported EPS is $0.07531 EPS, expectations were $0.09.

Eduardo Galvao: Good afternoon and thank you for joining us for CI&T First Quarter of 2026 Earnings Call. I am Eduardo Galvao, Director of Investor Relations. Joining me today to discuss our results and strategic milestones are Cesar Gon, our Founder and CEO; Bruno Guicardi, Founder and President for North America and Europe; and Stanley Rodrigues, our CFO. Before we begin, I would like to remind you that our remarks today will include forward-looking statements. These statements, including our business outlook, are based on the management’s current expectations and are subject to risks and uncertainties that could cause actual results to differ materially. We caution you not to place undue reliance on these forward-looking statements as they are valid only as of the date when made.

Additionally, we’ll discuss certain non-GAAP financial measures. We believe this provides a more comprehensive view of our underlying operational performance. For a full reconciliation of these measures to the most directly comparable GAAP metrics, please refer to the tables in our earnings release. Today’s session is being recorded. [Operator Instructions] The full presentation deck is available on our Investor Relations website, and a replay of this call will be posted shortly after we conclude. With that, I’m pleased to hand the floor over to our Founder and CEO, Cesar Gon.

Cesar Gon: Thank you, Eduardo, and good day, everyone. A year ago, I said the future of business is technology and the future of technology is business. Six consecutive quarters of double-digit organic growth tell me that, that was right. What has changed is the kind of partner companies are looking for, not a traditional horizontal service firm, but what we are choosing to call tech-integrated business solutions partner. We continue to advance 2 distinct AI-driven growth vectors for CI&T; AI deployment which expands revenue through IP-based solutions and AI adoption engagements and AI monetization which expand margins by evolving our pricing models to capture a greater share of the productivity gains and business value created by AI.

2025 was a very strong year for AI deployment, and this trend has only strengthened in 2026. At the same time, 2026 marks the year when our AI monetization efforts are becoming more tangible. In Q1 2026, 20% of new sales were already based on new pricing models. We expect these models to contribute to gross margin expansion over the coming quarters as adoption continues to accelerate. By combining strategy, AI-native execution with Agentic SDLC and IP-based solutions, we are positioning CI&T to help lead the next decade of business reinvention. Turning to our financial performance. The first quarter of 2026 was a period of significant scale and sustained momentum. We achieved record revenue of $136.6 million, representing 23.2% year-over-year organic growth.

This outperformance is notably broad-based with robust demand across all core geographies and a diversified footprint spanning our key industry verticals. Profitability remains a core strength of our model with adjusted EBITDA reaching $20.8 million, representing a 15.2% margin. On an FX-neutral basis, this would be equivalent to an adjusted EBITDA margin of 17.4%. This performance reflects our ability to continue investing in our AI growth vectors while maintaining a disciplined operational profile. Furthermore, our business continues to demonstrate high-quality cash conversion with $13.5 million in cash — operating cash flow this quarter, equivalent to 65% of adjusted EBITDA. The first quarter of 2026 marked our 60th consecutive quarter of double-digit organic growth, and this growth remains fully organic.

Q&A Session

This consistency is not accidental, it reflects a structural shift in client demand and CI&T’s ability to capture it. We are now seeing a clear acceleration of AI deployment. Clients are moving beyond experimentation and beginning to rebuild their technology foundations, operating models and business processes around AI. They need partners capable of connecting strategy, execution and measurable outcomes in the complex reality of large enterprise environments. This is where CI&T is increasingly differentiated. Our proprietary IP, AI native delivery capabilities and CI&T FLOW are helping us convert this demand into large higher-quality engagements, both with new clients and within existing accounts. The case studies that follow show how this AI deployment momentum is translating into tangible business outcomes.

[Presentation]

Cesar Gon: These cases serve as empirical evidence of how our Agentic SDLCs fundamentally resetting the baseline for enterprise productivity and speed to value. I will now hand over to Bruno to discuss how we are scaling this hyper productivity through our global delivery model and our evolved [ talent ] strategy.

Bruno Guicardi: Thanks, Cesar. Good afternoon, everyone. I’m excited to share our operational and talent progress for this quarter. We ended the first quarter 2026 with over 8,000 professionals, including an average of 6,600 AI-builders. While our headcount increased 13.3% year-over-year, this remained below our 15.5% revenue growth at constant currency. This delta has already begun lifting our revenue per professional, and we expect it to widen as AI monetization scales. Value-based pricing led us capture more of the value we create per engagement, strengthening our unit economics as we continue to grow the team. As Cesar noted, we have pivoted from technology execution to strategic AI deployment. Our talent is no longer merely building code.

They are curators of AI, leveraging CI&T FLOW and the Agentic SDLC to collapse development times and deliver hyper productivity. This shift is only possible because of our culture of continuous adaptation. We ended the quarter with a 4.1 Glassdoor score, the highest among our peer group and having been recognized by Great Place to Work for 19 consecutive years. Our voluntary attrition remains at a healthy 10.3%, the lowest level in our recent history, in an era where AI is redefining technical careers. Our industry-leading retention proves that our people feel empowered by these tools, not replaced by them. Our AI-builders are the engine of our innovation and their ability to orchestrate complex AI agents is the fundamental differentiator for CI&T in the global market.

I’m proud to announce the launch of our 2025 global ESG report this quarter, reaffirming our commitment to the UN Global Compact. Our culture remains a primary competitive advantage and 52.2% of our global workforce is from underrepresented groups. The diversity of perspective is what allows us to navigate the ethical complexity of AI responsibly. It’s not separate from the business. It’s why clients trust us with their work. The report also covers our social impact. Over 100,000 people reached through funded projects alongside governance and environmental milestones, including the Golden Seal from the Brazil GHG Protocol and 100% renewable energy across our Brazilian operations. I invite you to explore the full report published on our website.

Now over to Stanley to guide us through our financial performance.

Stanley Rodrigues: Thank you, Bruno, and good afternoon, everyone. Let me walk you through our financial performance for the first quarter of 2026. We achieved $136.6 million in net revenue, representing a robust 23.2% growth compared to the same period last year, fully organic. On a constant currency basis, revenue grew 15.5% year-over-year. I want to highlight that this performance exceeded our guidance and surpassed current analyst estimates. This outperformance is underpinned by exceptional momentum in our go-to-market execution. Throughout the quarter, we observed a significant expansion in our sales pipeline and an improved conversion rate, the direct result of intentional sales initiatives and the tangible impact our AI deployment is delivering for our clients.

What excites us most is the underlying quality and breadth of this performance. From a geographic perspective, Latin America led the acceleration with 33% growth, while North America delivered a solid increase of 16% and new markets grew 11% year-over-year. We achieved an 18.9% expansion within our top 10 accounts, yet our growth remains healthily distributed. This resilience was visible across nearly all industry verticals, which grew at double digits with our Consumer Goods segment remaining stable. This broad-based performance confirms that our AI deployment is not a localized success. It is a global catalyst that is driving deeper penetration across all regions and industries we serve. This chart illustrates our land and expand strategy in action.

We grew our $5 million to $10 million client cohort from 15 to 18 clients in the quarter, a compounding effect of our ability to scale wallet share through AI-driven impact. Our performance is fueled by exceptional go-to-market momentum. We observed significant pipeline expansion and improved conversion rates this quarter, the direct result of intentional sales initiatives and the tangible return on investments our AI deployment provides. This strength creates a highly predictable and resilient revenue base as we deepen these strategic partnerships. In the first quarter of 2026, our adjusted EBITDA reached $20.8 million, a 6.3% increase year-over-year, resulting in a 15.2% margin. It is important to note that this margin reflects 2 specific headwinds, unfavorable foreign exchange comparisons and the impact of increased Brazilian payroll taxes.

To provide a clearer view of our operational performance, if we exclude the FX impact, our first quarter ’26 EBITDA would have reached $22.2 million, equivalent to a 17.4% margin and a robust 13.2% year-over-year growth. This FX impact was more pronounced in the first quarter due to the year-over-year Brazilian reais-U.S. dollar comparison base, and it is expected to attenuate over the coming quarters. We remain focused on ensuring that the hyper productivity we are engineering today becomes the permanent foundation for long-term sustainable profitability. As Cesar mentioned, we expect our new engagement models to contribute to profitability margin expansion over the coming quarters as adoption continues to accelerate and we capture a greater share of the value we create.

Moving to our bottom line. Adjusted profit reached $10.2 million in the first quarter of 2026, This represents a 6.2% increase compared to the same period last year, resulting in an adjusted net income margin of 7.5%. Most importantly, our adjusted diluted earnings per share was $0.08, representing a robust 11.8% increase over first quarter ’25. This double-digit growth in earnings per share, surpassing our net profit growth, is a direct result of our disciplined capital allocation strategy and the increasing operating leverage within our AI native platform. I will now turn the call back to Cesar to discuss our business outlook and the strategic path forward for the remainder of 2026.

Cesar Gon: Thank you, Stanley. For the second quarter of 2026, we expect revenue of at least $140 million, representing 19.5% growth year-over-year or 13.9% at constant currency. Based on our strong first quarter performance and the quality of our current pipeline, we are increasing our full year 2026 revenue guidance to a range of $556 million to $575 million. This implies organic growth of 13.5% to 17.5% with a midpoint of 15.5%. Our revised growth outlook includes a positive FX impact of approximately 350 basis points, which is 50 basis points higher than our previous guidance. Effectively, of our 150 basis points increase of our revenue guidance, 100 basis points are driven by pure organic momentum and improved pipeline conversion.

Our updated guidance reflects the continuing strength of our first AI-driven growth vector, AI deployment, which is fueling revenue expansion through IP-based solutions and AI adoption engagements, combined with our well-oiled go-to-market strategy. In addition, we estimate our adjusted EBITDA margin to be in the range of 17% to 19%. We project margin expansion to build sequentially throughout the year, supported by our second AI-driven growth vector, AI monetization, as the adoption of new pricing models accelerates and enable us to incrementally capture a great share of the productivity gains and business value created by AI. With that, we are ready to begin the Q&A session. Thank you.

Eduardo Galvao: [Operator Instructions] The first question comes from Gustavo Farias from UBS.

Gustavo Farias: Two on my end. First of all, congratulations on the results. First question, if you could provide color on the current pipeline of projects and the mix between the types and the types of contracts; time-and-materials, outcome-based, fixed price and how this has been evolving and the margin profile you’ve been encountering in each of them. My second question is related to margins. We’ve seen the margin below — a little bit below our numbers and consensus numbers. Of course, you explained very clearly the main drivers. Just to double check here, how much of that was already expected by the previous and current margin guidance? And is it fair to assume margin, based on Q1 results, could be brought towards the lower end of this 17% to 19% range? That’s my second question.

Cesar Gon: Thanks Gustavo. I can handle the first one and then Stanley can get the second one. Regarding pricing models, as planned, we are now advancing what we are calling the AI monetization effort. That basically is an effort to synchronize AI deployment with the evolution of our pricing models to be more value-based, and of course, giving us the opportunity to capture more margins from the efficiency and impact we are generating. We disclosed, for the first time, this evolution by giving the data point of 20% of all the new sales in the fourth quarter were already based on this value-based models. Value-based models is — for us is a combination of output based with price per consumption or we call Asian computing units when we sell in a semi-sized model and outcome-based.

So output consumption and outcome based. This is basically what is behind the 20% we disclosed as a combination of a mix of these different pricing models. We believe the future will be really a hybrid model where we combine — it depends on the situation, the scenario, we combine all these alternatives in the end with the will to provide more flexibility to our clients, skin in the game from CI&T regarding our ability to leverage value from the AI deployment and also, of course, capture more of the share of the impact we are generating. So what we — of course, our business model is very current. So we have long-term contracts. So that’s why quarter-over-quarter you’re going to see a visible, tangible increment in our gross margin as a result of this move towards new pricing models.

But we also will keep — I’m sure we will have part of our revenue still based on time-material. But even time-material, if you see what’s happening in the industry, time-material is being rebranded, right, as for the engineering deployment. So there’s a new set of opportunities even for time-material engagements to reprice it based on deep AI competence. So I think all good moves, vectors in our favor, and I see a very consistent strategy for CI&T on these 2 vectors, AI deployment combined with a disciplined AI monetization. Stanley, if you could address specifically the second question from Gustavo.

Stanley Rodrigues: Yes. Gustavo, thank you for the question about margins. Well, if you see, Gustavo, we are maintaining our guidance of EBITDA of the range of 17% to 19%. And what is built in that guidance? First, structural characteristics of our business seasonality. We have higher margins towards second half of the year. We also have an operating leverage going on for the last years, and we will continue to see that throughout 2026. And on top of that, we have the margin expansion out of the AI monetization through new engagement models. So all of that combined is, let’s say, compensating for the real appreciation, which is a headwind to the margins, which is already within or in this 17% to 19% guidance. And at the end, if you see, in absolute terms, EBITDA will increase from — in comparison to 2026. So the question is more towards the margin effects in the revenue.

Eduardo Galvao: Our next question comes from Puneet Jain from JPMorgan.

Puneet Jain: I also have like a question on this new AI-based delivery model, Agentic SDLC. So like if — assuming like if some of those contracts stay as time and material, how does — how do you integrate like the token cost and like the — overall like the AI portion of cost in your delivery structure? And how does like the margin profile of some of those contracts compare with your typical people-based models?

Cesar Gon: Thanks, Puneet. Basically, in terms of pricing, even in time-material engagements, we continue to see a very rational price environment and a lot of openness from our clients to discuss new pricing models and to incorporate eventually the new opportunities regarding AI. So we — now we see a lot of opportunity. Of course, the easy or let’s say the low-hanging fruit is just — as now we are really — I think with a very superior approach on AI deployment, we can accommodate any additional cost in our pricing model. But I think the real — the most strategic part is moving from, as I mentioned, from time-material to a new output-based, outcome-based and consumption-based model. So I think this — as the demand is huge and the eagerness of our clients to leverage AI benefits are increasing, we are not seeing — of course, we need to synchronize everything, and it’s what we do.

I think we are very good on that. And so I think we are kind of very happy with what we could do in the previous quarters regarding AI deployment and what we see the speed of — what we are seeing in the advancement of AI monetization efforts. So very — I see more as our ability to demonstrate that. In the end, if you are able to demonstrate the impact you can generate with AI for our clients, they respond accordingly in terms of adjusting the model in the right direction.

Bruno Guicardi: And if I can complement, Puneet, like the adjustment is not a gradual, incremental one, right? We’re talking about 3x, 5x, 7x. So when you kind of create that type of impact, to Cesar’s point, like clients are open to having more of that and then expand. And that’s how we’ve been growing with increasing wallet share within clients, getting more space, those — making those relationships closer, right? So — and again, the engagement model, they’re open to have more of that. So it’s a win-win conversation.

Puneet Jain: Appreciate that. And are you seeing like any impact from like the geopolitical uncertainty, the war in the Middle East to your clients’ decision-making at all? Like, any verticals anywhere where you might be seeing signs of slowdown in second quarter compared to — in Q1?

Stanley Rodrigues: Not really no. So far, we haven’t — again, the dynamics of this growth and the growth that we’re kind of guiding, it’s based on the dynamic within our clients and our ability to kind of create more value than our competitors within those clients and winning wallet share and growing with them. And they’re big, stable companies, leaders in their market. So they’re solid companies. They’re growing, they’re doing well. So if we do our part, which is create value for them and being ahead of the pack, which we think we are at this point, and we have to keep ahead of the pack, I don’t think that the macro will impact a ton.

Eduardo Galvao: Our next question comes from Steven from Wedbush.

Steven Wahrhaftig: Congrats on the quarter. So I have 2 questions, one on the value-based pricing and then one also on the headcount growth. Specifically for the value-based pricing, you mentioned that 20% of the net sales is coming from this value-based pricing approach. Do you have any sort of long-term gauge or any sort of long-term target that we can take into account for this value-based pricing and what the company’s expectations are to really get a lot of these new customers onto this value-based pricing approach? And then turning to the headcount, especially when you’re starting to see over 80% of your headcount really leveraging AI and becoming the curators of AI, as you described. Is that going to lead to any sort of headcount reduction in the near term or in the long term and something that we can take into account from there?

Cesar Gon: I can get the first one. Steve, thank you for your question, and Bruno can help with the second. Regarding new pricing models, we see this change happening in the horizon of maybe 18 months as a natural evolution of — as the new sales become relevant in terms of revenue quarter-over-quarter. So gradually, you’re going to see the effect happening in our — especially in our gross margin, where you can clearly see the difference on the value we are capturing from the engagement. Another thing that is, it’s not just pricing models. I think our offerings are evolving to generate much, much more impact to our clients. So it give us a lot of flexibility. And as we see the momentum of AI deployment increase and the way we are very well positioned, we see room for really accommodate the CI&T in a better shape regarding value capture.

So, gradually, quarter-by-quarter, following the impact, the increased impact we are generating for our clients; impacts around, like say, horizontal impact regarding efficiency. So, a lot of things that we can do now with an amazing return on investment for them regarding data, regarding app modernization and so on and direct AI impact with the new use cases that are emerging for every vertical and segment. So a lot of opportunities, and I think we are very well positioned to capture that. Regarding our workforce, I think Bruno can address that.

Bruno Guicardi: Yes. So thank you for the question, Steve. Like the way we see this, right, so even if the total addressable market reduces in size, like it would not reduce by a lot and maybe not even not reduce at all. But our ambition here is actually to be a leader in this new industry, in the industry of the AI builders. And if we accomplish that and to our point here, we are ahead of the curve and our plan is to be aggressively ahead of that curve, and we’ll capture — we will be a winner in this new market, right? So being a winner in this new market, I think will not necessarily mean that we will grow by revenue, but even by headcount, we’ll continue to grow. So that’s the ambition, is to win in this new game and to keep giving opportunity for our people and having them — have their own grow and becoming the leading professionals in their industry and creating value for our clients.

And I don’t think we’ll kind of anticipate any headcount reduction in that scenario.

Eduardo Galvao: Just to add to that, Steve, one way to look at that, as we evolve on these new engagement models, we should see higher revenue per headcount. I think it is the best way to see that trend going forward. So as Bruno mentioned, growing headcount and growing revenue per headcount as well. So that should be a good indicator to track as we evolve in these new models.

Cesar Gon: Let me add one thing that I think is important. Looking back, we did an amazing job in the past 3 years. We really introduced CI&T FLOW with faster adoption. We’re reskilling our whole team around artificial intelligence. And we also turned every single CI&T engagement into an AI engagement. So now we have builders, AI builders. That is, I think, the most important talent for — to make AI deployment feasible. So I think it was a very good strategy not to create a different business unit for AI services. We said, let’s look at our core offerings and redesign around AI 3 years ago. So now we are leveraging the results of these bets.

Eduardo Galvao: Our next question comes from Bryan Bergin from TD Cowen.

Bryan Bergin: So I wanted to also ask about this contract structure evolution. Is this across industries, kind of across the portfolio? Can you talk about the nature of the clients that are going along with this and kind of the characteristics that those clients have that you could learn from to better kind of cross-pollinate across the entire portfolio?

Cesar Gon: Thanks, Bryan. Great to see you. I think part of the evolution of the pricing models is combining with our IP-based offerings. As more IP is on the table in a deal, more, I would say, more feasible it is to introduce new commercial models. So we are combining, and as we are working hard around our vertical IP-based solutions, by now, we have, I think, a solid set of assets that allow us to really foster our AI monetization through the new model. So I think IP intellectual property is an important foundation of our strategy. If I can summarize our strategy in first 2 growth vectors we mentioned, AI deployment, AI monetization; and 4 pillars, IP-based offerings, commercial models, data is incredible what we are doing around data and partnerships with the hyperscalers.

So these 4 pillars are fostering our growth vectors, I think, in an amazing way. So our job is to synchronize all this momentum and capture the growth and the value we deserve by the impact we are generating.

Bryan Bergin: Okay. As it relates to your large clients, you had another good performance, top 1, top 10. Maybe just dig in there, your visibility to continued momentum in those accounts.

Cesar Gon: Yes. We are, I think, this quarter, we reported — we grew in all verticals and cohort of clients, top 1, top 10, ex-top 1, ex-top 10. So it’s a very broad, good momentum regarding AI deployment. Of course, we stay focused on the kind of clients we believe is the hotspot for CI&T, large complex organizations that are really looking for ways to leverage AI impact, and I think it’s even regions. We grew in Latin America and North America; even new markets had a good response in this last quarter. So, we continue — we are expecting the momentum will continue in all the verticals and regions.

Eduardo Galvao: Our next question comes from Luke Morison from Canaccord.

Lucas Morison: So maybe one on gross margins. They compressed quite a bit in the quarter. Can you just help us unpack what’s driving that, whether it’s entirely this FX and payroll tax impact or if there’s maybe an element of AI spend and AI investment that you maybe need to scale into? And how should we be thinking about modeling gross margins for the rest of the year and onward?

Stanley Rodrigues: Luke, thank you for the question. Well, let’s unpack as you want. First, by far, it is the FX effect and it’s more than 200 basis only in that aspect we presented in the slides, adjusted by current currency equivalent, right? And you have to bear in mind that by seasonality, we have a load every first quarter of the year, a load of salary adjustments that will be throughout the year compensated by contract adjustments and so on. So, again, here, we have the combination of the structural aspect and this specific FX effect. So — those are, I would say, the main aspects for the first quarter. And as modeling for the next quarter, again, we have the seasonality play here. We have higher working days throughout the next quarters in comparison to first quarter, for example.

We have the leveraging of SG&A as we grow the business. So what else? We have a combination of structural aspects. And in addition, we do have the monetization of the new engagement models taking a play, an important role here as well throughout the next quarters. So I wouldn’t say that you shouldn’t model anything different than what we guided in terms of EBITDA. That’s why we are guiding, right? So — and we have the range for the reasons usually we have for that range, right? On top of the range, we have a reflection of what we envision in all the pipeline that we have; midpoint, we have a more conservative aspect of that; and in the lower, we have macro effects or something compounding there to be more conservative. So yes, that’s the breakdown, Luke.

Lucas Morison: Got it. Very helpful. And then maybe a quick follow-up there. Of that 20% of new sales in Q1 that are on these new pricing models, can you just give us a sense of like what do gross margins look like on those engagements? What can it scale to over time? How can that like impact the overall gross margin profile of the business over like a 2- to 5-year period?

Stanley Rodrigues: Yes. Well, we — what we are doing as we capture value on this monetization, AI monetization, the trend is to reinvest in sales. So if you would see increments in gross margin, the trend is that we would reinvest in sales to capture and to benefit growth. So at the end of the day, it’s about the growth and the organic growth and to continue in this strong momentum that we are. So usually, that’s the engineering.

Cesar Gon: Let me help here. Luke, we can be a little more specific. I think the new pricing models can increase. Depends on the — of course, in the context, the engagement from 3 or 4 percentage points to 10 or 15 percentage points in terms of contribution margin, the engagement. So — and that’s why we see as a pillar in our strategy to capture part of the — this is only possible because we are not delivering the same kind of impact. We are delivering much higher impact. If you try to discuss pricing model with the clients, delivering the same value, it’s — of course, it’s not going to work. But we are discussing delivering a different level of impact. And this has allowed us to move towards these more powerful pricing models.

Another thing is, I think if you look at our — the numbers we just released, if you combine our organic growth of 23.2% with our adjusted EBITDA margin of 15.2%, we reached — and we add that, we reached 38.4%, nearly back to the famous rule of 40%. So if we would put in perspective, everything we are doing, looking ahead, I think we can expect better — you’re going to see from next quarter better gross margins as a result, of course, the fundamental seasonality, a lot of things that Stanley described, but also the beginning of the impact of the new pricing models, and this will allow us to increase our sales investments, what is the strategy to fuel high growth and strong bottom line in the long term? So this is the piece of the puzzle we are handling now, I think, in a very good way.

Eduardo Galvao: Our next question comes from Cesar Medina from Morgan Stanley.

Cesar Medina: Congratulations on the results, quite strong and broad-based. The question that I had was twofold. One, sorry to keep pressing on the new pricing mechanism, but it’s just 20% of the new sales, right? It’s not of the total revenues for the quarter. And if I were to ask you in terms of when you look at your pipeline, the one that you’re building, not on the second quarter, but on the pipeline, how prevalent is that new sales mechanism? That will be the first question, and then I’ll have a different [ update ].

Cesar Gon: Very good, Medina. Thank you for the question. Basically, as you know, we have a lot of recurring long-term revenue. But in a time line of 18 months, everything that we will be doing will be new sales. So that’s the first data point. So it takes basically 18 months to renew 100% of the engagements of CI&T. And the second, is pipeline healthy. We — the data point now, it is 30% large. So the number of deals in terms of value is 30% higher now than the same period last year and 100% relate to AI deployment. So this is — if you combine this data, you see how we are growing and that is AI deployment and evolving our AI monetization along the next quarters.

Cesar Medina: But pursuant to what Stanley mentioned in terms of the margins of the new pricing mechanism that you are reinvesting in growth. But if I were to look at the gross margin component, these gross margins of these new type of engagements, is the margin closer to software or higher you mentioned…

Cesar Gon: [ But then ] What’s software? I think now we are looking — I think we have a very healthy strategy with — but the new reality is a business with higher gross margin, significant higher gross margin, but also with different elements in the P&L. So — but I think it’s — in the end, it’s moving to a more scalable and profitable business model, but gradually, as we deploy these new models and increase our effort. The mention regarding sales is because we see a huge opportunity. If the market continues to move in our direction as we are seeing, we have the opportunity to really accelerate our expansion, and this will require broad investments around go-to-market and sales.

Cesar Medina: Okay. And then the second question is pursuant to your full year guidance, like if I were to do the math in terms of constant currency for first quarter, second quarter, that suggests that in the second half of the year, you’re sort of going to have more muted growth. Is that sort of the right way to see it?

Cesar Gon: Yes. We kind of detailed that what we increased in 150 basis points, 100 basis points is a pure reflection of demand and pipeline and so on and 50 basis points is FX tailwind. So — and of course, as we have been doing for several — 6 consecutive quarters, we intend to do better, increase our numbers as we win the AI deployment game.

Eduardo Galvao: So that concludes our Q&A session. I’ll now invite Cesar Gon to proceed with his closing remarks.

Cesar Gon: Thanks, Galvao. Thank you, Bruno, Stanley, Eduardo, again. Thank you all for joining us today, and more especially, I want to thank you all CI&T-ers around the world. Congratulations for one more record quarter. Let’s keep pushing. And a special thank you as well, for our clients, for choosing CI&T in this extraordinary moment of AI deployment and AI-driven innovation. So stay well. See you soon.