Welcome to the IBEX Second Quarter FY 2026 Earnings Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded. [Operator Instructions] To note, there is an accompanying earnings presentation available on the IBEX Investor Relations website at investors.ibex.co. I will now turn this conference over to Greg Bradbury, Investor Relations for IBEX.

Good afternoon, and thank you for joining us today. Before we begin, I want to remind you that matters discussed on today's call may include forward-looking statements related to our operating performance, financial goals and business outlook which are based on management's current beliefs and assumptions. Please note that these forward-looking statements reflect our opinion as of the date of this call, and we undertake no obligation to revise this information as a result of new developments, which may occur. Forward-looking statements are subject to various risks, uncertainties and other factors that could cause our actual results to differ materially from those expected and described today. For a more detailed description of our risk factors, please review our annual report on Form 10-K filed with the U.S. Securities and Exchange Commission on September 11, 2025, and any other risk factors we include in subsequent filings with the SEC. With that, I will now turn the call over to IBEX's CEO, Bob Dechant.

Thanks, Greg. Good afternoon, and thank you all for joining us today as we review our fiscal second quarter 2026 results. I'd like to start by recognizing the entire IBEX organization for delivering another outstanding quarter yet again. Their continued consistent execution underpins our financial and operational success and is key in building IBEX into the category disruptor we are today. Looking to our results, I am pleased to report that the momentum we've built across the business accelerated in the second quarter, enabling us to deliver exceptional results with headline revenue growth of 17% and adjusted EPS growth of 46%. Quarter-over-quarter, we are continuing to further separate ourselves from the pack in the BPO market. In fact, this quarter marks our fourth consecutive period of double-digit organic revenue growth, well above competitive growth rates and underscores our clear differentiation. And this continues to resonate well in the market. Our market-leading growth is a direct result of the differentiation we have built into our business and our ability to execute against it. At the top, our growth starts with our new logo engine, which consistently is able to win trophy clients versus our much bigger competitors. In Q2, we had significant wins in HealthTech and FinTech. HealthTech has been a standout performer, growing rapidly since we launched the vertical in 2021 and is on track to become $100 million by the end of the fiscal year. This success demonstrates our ability to build and scale new verticals from the ground up. Outside of the new wins, we are also driving growth within our existing customer base. Our approach is simple. Once we begin working with a customer, we build that relationship over time through a combination of exceptional operational delivery and differentiated service model built with innovative technology at its…

Thank you, Bob, and good afternoon, everyone. Thank you for joining the call today. In my discussions of our second quarter fiscal year 2026 financial results, references to revenue, net income and net cash generated from operations are on a U.S. GAAP basis, while adjusted net income, adjusted earnings per share, adjusted EBITDA and free cash flow are on a non-GAAP basis. Reconciliations of our U.S. GAAP to non-GAAP measures are included in the tables attached to our earnings press release. Turning to our results. Our second quarter results are once again among the strongest in our history with record revenue and EPS. Second quarter revenue was $164.2 million, an increase of 16.7% from $140.7 million in the prior year quarter, marking our fourth consecutive quarter of double-digit top line growth. Revenue growth was driven predominantly by growth in our high-margin HealthTech vertical of 35.1%, travel, transportation and logistics of 20.2% and retail and e-commerce of 17.2% as well as strong performance by our digital acquisition services, partially offset by an expected decline in telecommunications, one of our smallest verticals of 23.1%. We continue to win and grow in all geographic markets and our focused efforts to grow our higher-margin offshore delivery locations are continuing to have a favorable impact on bottom line results. Our highest margin offshore revenues grew 16.2% compared to the prior year quarter. Our nearshore locations grew 8.5% and our onshore region grew 27.5%, driven by growth in our high-margin digital acquisition services. Offshore revenues comprised 52.3% of total revenue and onshore revenues expanded to 24% of total revenue from 22% in the prior year quarter, reflective of the growth in our digital acquisition services. Our higher-margin digital and omnichannel services continues to strengthen, growing 19% versus the prior year quarter to 82% of our total…

[Operator Instructions] Our first question comes from David Koning with Baird.

Great job again. And I guess to kick it off, a lot of market turbulence around AI and who's going to win and who's going to lose and new products coming out. It sounds like you're doing very well. Just you talked a little bit already about it on the call, but maybe give a little more color on the demand you're seeing. Is your industry and your company a benefit of AI? Is it a headwind? Maybe just talk through that a little more.

Yes, Dave, and thanks for the question and your opening comments. I couldn't be more prouder of the team that just continues to deliver quarter-over-quarter. Look, I think we have established ourselves in the AI leadership position in this industry. And there's a lot of good things that comes out of that. it helps our new logo engine going in and winning traditional just BPO deals because this is a company that can take the journey of where those clients, those trophy clients want to go. So it helps us significantly in that. Number two, it helps us in the operational execution of the day-to-day business that we have to outperform, to distance -- to continue to distance ourselves from the pack in terms of performance, which then pays off in market share growth. As an example, and I think this is on the slide, our top 10 clients, we grew 20%. Where did that come from? It came from market share because of our outperformance. Then the third dimension is where we now are creating those AI agentic solutions, AI agents. But the value proposition that we have is very, very unique because we're leveraging the power of our business insights organization and what we do on the human side, and we kind of create that what I'll call seamless journey end-to-end. And it's almost think of it as like an integrated supply chain in the world of years ago and all of a sudden, you get more velocity through that supply chain and you engineer cost out but you create it as an integrated supply chain. That's what we're doing and the vision that we're sharing that's different, I believe, than anybody in the industry right now, and that's resonating well.

Yes. Great. I guess, secondly, just the mix of business is changing, it sounds like very favorably, higher margins, better growth away from telecom towards health care. Does that change the kind of sequential pattern of revenue through each year? Or does that -- usually Q3 and Q4 are down a couple -- a few percent sequentially, whatever it is. Is there any like changes either to that or any other mix shift impacts to the business?

So that's a really good question, Dave. And I would say, as most of us kind of have gotten to understand, the world of retail is very, very heavy in the December quarter, right, as you get from Black Friday, Cyber Monday all the way through the holidays, Christmas and all. And so we've been a leader in that vertical for a long time. And so you would see a huge spike in Q2 as kind of you highlight. And then that would start tapering off in Q3 and Q4. I think the mix has changed. And if you look at what we did last year, you could see that Q2 to Q3 sequential did not go down like it has historically. So it does change some of that. And so we feel pretty good about, I think, maybe a little bit more consistent flow over the 4 quarters and less massive -- just a massive spike for Q2.

Yes. Okay. And maybe -- that's helpful. And then maybe just one quick last question. The gross margins went down year-over-year, but the operating expense percent of revenue got way more favorable. Is that a little mix of maybe the offshore shift? Or what's driving that?

Do you want me take that, Bob? Yes, sure, Tim. Yes. No. So you're right. We're doing a very good job in terms of growing our SG&A expenses less than revenue, and you're seeing SG&A come down as a percent of revenue. And if you look at our gross margins, we're very -- we feel very good about the trajectory of our gross margins in the long term because if you look at the growth vectors, as Bob was mentioning, they're the high-margin vectors, right? It's the vertical markets, it's the offshore geos, it's the services, high-margin services. and then you throw AI in, it's the high-margin geos and services, which are driving our business forward. But we do have a couple of headwinds currently, and they're not bad -- necessarily bad headwinds to have. One is on our deferred training revenue. I think we touched on this in the first quarter and also saw it in the second quarter that the year-over-year impact on deferred training as we're growing, we have more training and we expensed most of the training costs in period, but the revenue associated with training gets spread over the cost of the program. So that's a bit of a headwind for us right now during this high-growth phase. And then in addition, we're less than a year into India right now, and we're still investing in India, and we are up to where we expect those margins to be. So those are 2 headwinds that we feel right now. But as I said, they're not necessarily bad headwinds to have. It's just representative of the growth.

And I'm not showing any further questions. I'd now like to turn the call back over to Bob Dechant for any closing remarks.

Great. Thanks, Josh. And thank you all for joining us today. And as I've said, I couldn't be more proud of what IBEX has accomplished and what this team continually does quarter-over-quarter. We are a differentiated company. We are best-in-class in culture, engagement, our tech stack, and we are leading the clubhouse in AI. And so put all those together, the -- we really like where the future is for this business, and we look forward to reporting in the next 90 days. Thank you all. Have a good night.

Thank you. This concludes the conference. Thank you for your participation. You may now disconnect.