Why EPAM Systems (EPAM) Shares Are Slumping Today - EPAM Sys (NYSE:EPAM)

EPAM Systems, Inc. EPAM shares are plummeting Monday after slashing its second quarter and full year 2023 financial outlook due to sluggishness in the near-term demand environment.
After careful assessment of changes in the company's May and June forecast data, EPAM has also seen a reduction in the total pipeline.
Given the continued uncertainty in the demand environment, the company sees second-quarter revenues of $1.160 billion-$1.170 billion, compared with prior guidance of $1.195 billion-$1.205 billion. This reflects a year-over-year decrease of 2.5% at the midpoint of the range. The Street view stands at $1.20 billion.
EPAM now expects Q2 non-GAAP EPS of $2.33-$2.40, compared with prior guidance of $2.38-$2.46. The Street view is pegged at $2.41.
The company has been seeing slower pipeline conversions as its clients have become spending cautiously, specifically in the 'build' segment of the global IT services market.
For the full year, revenues are expected to be $4.650 billion-$4.800 billion, compared with the prior forecast of $4.950 billion-$5 billion. This reflects a year-over-year decrease of 2% at the midpoint of the range. The street view is pegged at $4.96 billion.
EPAM expects non-GAAP EPS to be $9.80-$10.20 (consensus $10.72), compared with the earlier outlook of $10.60-$10.80 for the year.
On the positive side, EPAM is encouraged by the increasing pace of new logo acquisition and continued high customer retention and satisfaction rates.
"Once industry demand returns, EPAM will once again be well positioned for long-term growth by leveraging our unique and globally recognized engineering and transformation capabilities," said Arkadiy Dobkin, CEO & President of EPAM.
Price Action: EPAM shares are trading lower by 14.12% to $223.00 in the premarket session on the last check Monday.

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Why EPAM Systems Shares Are Slumping Today