Globant's August 13 earnings release gave investors the number they didn't want: the AI services story is growing, but the old consulting model is still too large to outrun.
Globant built its public pitch around helping large companies move into AI. Then its own guidance showed how painful that shift can be when your legacy business is still tied to people, projects and hours. The stock paid for it.
According to Globant's second-quarter earnings release, the company cut its full-year 2026 revenue outlook to $2.428 billion to $2.462 billion, down from the $2.462 billion to $2.508 billion range it gave after the first quarter. At the low end, that now means a 1.1% year-over-year decline. At the high end, it means only 0.3% growth. That's not the kind of line investors want from a company selling itself as an AI-native services leader.
The earnings cut wasn't limited to sales. Globant also lowered its full-year non-IFRS adjusted diluted EPS forecast to $5.75 to $6.15, from $6.10 to $6.50. Second-quarter revenue came in at $614.4 million, almost flat from $614.2 million a year earlier, while non-IFRS adjusted diluted EPS fell to $1.40 from $1.53. The company had 27,411 employees at the end of June, down from 30,084 a year earlier.
That's the problem.
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Globant can talk about AI as a growth engine, and some of that talk is backed by real numbers. But the wider company is still fighting slow demand, margin pressure and a model that has historically relied heavily on time-and-materials work. If you bill for human time, AI changes the negotiation. Clients don't have to dislike you for the contract to shrink. They only have to believe the same work now takes fewer people.
The AI Pods bet is real #
Globant isn't pretending nothing has changed. CEO Martín Migoya said in the release that Glob.AI ARR reached $52.8 million in the second quarter, up 61% from the prior quarter, and that the company now expects at least $110 million by the end of 2026. He also said Glob.AI lets enterprises deploy AI Pods and pay for output or consumption rather than the hours behind it.
That last detail matters more than the branding. Globant is trying to move from selling teams to selling results. In June, the company announced Claude-powered AI Pods through a multi-year alliance with Anthropic. In July, it announced a Vercel partnership that lets those Pods ship AI-built applications to production faster. The pieces are there.
This is the hard part.
A new model can be better and still arrive too slowly to save the quarter in front of you. Globant's release says non-IFRS adjusted gross profit margin fell to 36.5% in the second quarter from 38.1% a year earlier, and adjusted profit from operations margin fell to 13.2% from 15.0%. The company also booked business optimization costs tied mainly to workforce resizing and office reductions. That isn't a victory lap. It's a reset.
Investors saw the hole first #
The market's reaction was not just about one trimmed forecast. It was about trust in the bridge between Globant's old business and its new one. If Glob.AI exits 2026 at $110 million of ARR, that is meaningful. But against a company guiding annual revenue above $2.4 billion, it is still a small piece of the whole machine.
Look at the customer count. Globant served 904 customers with more than $100,000 in revenue over the twelve months ended June 30, down from 981 a year earlier. Accounts generating more than $1 million in annual revenue slipped to 331 from 339. Those aren't catastrophic numbers, but they do tell you clients are moving carefully, and careful clients don't rescue a guidance cut.
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Frankly, investors are right to focus on the disappearing part first. AI Pods may become the cleaner, higher-value business Globant wants. For now, the company has to prove that a pay-for-output model can grow faster than traditional delivery weakens.
That is the real story inside the selloff. Globant isn't being punished because it missed the AI trend. It saw the trend early and built a product around it. It's being punished because seeing the future doesn't exempt you from the math of the present.
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