Operating margins have contracted to 8.5% in 2026Q1 from a 15.2% peak in 2024Q3, suggesting that administrative costs are currently outpacing revenue growth.
| Metric | TTM | Dec'25 | Dec'24 | Dec'23 | Dec'22 | Dec'21 | Dec'20 | Dec'19 | Dec'18 | Dec'17 | Dec'16 | Dec'15 | Dec'14 | Dec'13 | Dec'12 | Dec'11 | Dec'10 | Dec'09 |
|---|
| Sales/Revenue | 5.56B | 5.46B | 4.73B | 4.69B | 4.82B | 3.76B | 2.66B | 2.29B | 1.84B | 1.45B | 1.16B | 914.13M | 730.03M | 555.12M | 433.8M | 334.53M | 221.82M | 149.94M |
| Revenue Growth % | 14.21% | 15.42% | 0.8% | -2.78% | 28.38% | 41.31% | 15.94% | 24.47% | 27.06% | 25.02% | 26.91% | 25.22% | 31.51% | 27.97% | 29.67% | 50.81% | 47.94% | - |
| Cost of Goods Sold | 4.01B | 4.01B | 3.28B | 3.26B | 3.29B | 2.48B | 1.73B | 1.49B | 1.19B | 921.35M | 737.19M | 566.91M | 456.53M | 347.65M | 270.36M | 205.34M | 132.53M | 88.03M |
| COGS % of Revenue | - | 73.45% | 69.32% | 69.43% | 68.12% | 66.09% | 65.15% | 64.88% | 64.4% | 63.52% | 63.54% | 62.02% | 62.54% | 62.63% | 62.32% | 61.38% | 59.74% | 58.71% |
| Gross Profit | 1.55B | 1.45B | 1.45B | 1.43B | 1.54B | 1.27B | 926.96M | 805.6M | 655.99M | 529.1M | 422.95M | 347.21M | 273.5M | 207.47M | 163.44M | 129.19M | 89.3M | 61.91M |
| Gross Margin % | 27.92% | 26.55% | 30.68% | 30.57% | 31.88% | 33.91% | 34.85% | 35.12% | 35.6% | 36.48% | 36.46% | 37.98% | 37.46% | 37.37% | 37.68% | 38.62% | 40.26% | 41.29% |
| Gross Profit Growth % | - | -0.12% | 1.14% | -6.76% | 20.68% | 37.49% | 15.06% | 22.81% | 23.98% | 25.1% | 21.81% | 26.95% | 31.83% | 26.94% | 26.51% | 44.68% | 44.23% | - |
| Operating Expenses | 1B | 927.55M | 905.86M | 932.79M | 965.05M | 732.13M | 547.63M | 502.75M | 410.23M | 356.15M | 289.25M | 241.25M | 187.31M | 130.97M | 97.43M | 74.18M | 56.51M | 45.93M |
| OpEx % of Revenue | - | 17% | 19.16% | 19.89% | 20% | 19.48% | 20.59% | 21.92% | 22.26% | 24.55% | 24.93% | 26.39% | 25.66% | 23.59% | 22.46% | 22.18% | 25.47% | 30.63% |
| Selling, General & Admin | 938.4M | 928.71M | 816.3M | 815.07M | 872.78M | 648.74M | 484.76M | 457.43M | 373.59M | 327.59M | 265.86M | 222.76M | 163.67M | 116.5M | 85.87M | 64.93M | 47.63M | 39.25M |
| SG&A % of Revenue | - | 17.02% | 17.27% | 17.38% | 18.09% | 17.26% | 18.23% | 19.94% | 20.27% | 22.59% | 22.92% | 24.37% | 22.42% | 20.99% | 19.79% | 19.41% | 21.47% | 26.18% |
| Research & Development | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| R&D % of Revenue | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - |
| Other Operating Expenses | 2M | 0 | 89.56M | 117.72M | 92.27M | 83.39M | 62.87M | 45.32M | 36.64M | 28.56M | 23.39M | 18.49M | 23.65M | 14.48M | 11.56M | 9.25M | 8.87M | 6.68M |
| Operating Income | 550.4M | 521.16M | 544.58M | 501.24M | 572.97M | 542.32M | 379.32M | 302.85M | 245.76M | 172.95M | 133.7M | 105.97M | 86.18M | 76.49M | 66.01M | 55.01M | 32.79M | 15.98M |
| Operating Margin % | 9.91% | 9.55% | 11.52% | 10.69% | 11.88% | 14.43% | 14.26% | 13.2% | 13.34% | 11.92% | 11.52% | 11.59% | 11.81% | 13.78% | 15.22% | 16.44% | 14.78% | 10.66% |
| Operating Income Growth % | - | -4.3% | 8.65% | -12.52% | 5.65% | 42.97% | 25.25% | 23.23% | 42.1% | 29.36% | 26.17% | 22.96% | 12.67% | 15.89% | 19.99% | 67.76% | 105.17% | - |
| EBITDA | 696.4M | 645.97M | 671.69M | 633.94M | 713.01M | 687.47M | 508.57M | 404.03M | 282.4M | 201.51M | 157.08M | 123.36M | 103.67M | 91.61M | 76.89M | 62.55M | 39.03M | 21.6M |
| EBITDA Margin % | 12.54% | 11.84% | 14.21% | 13.52% | 14.78% | 18.29% | 19.12% | 17.61% | 15.32% | 13.89% | 13.54% | 13.49% | 14.2% | 16.5% | 17.72% | 18.7% | 17.6% | 14.41% |
| EBITDA Growth % | 3.9% | -3.83% | 5.95% | -11.09% | 3.72% | 35.18% | 25.87% | 43.07% | 40.15% | 28.28% | 27.33% | 19% | 13.16% | 19.15% | 22.93% | 60.24% | 80.7% | - |
| D&A (Non-Cash Add-back) | 146M | 124.81M | 127.1M | 132.7M | 140.05M | 145.15M | 129.24M | 101.18M | 36.64M | 28.56M | 23.39M | 17.39M | 17.48M | 15.12M | 10.88M | 7.54M | 6.24M | 5.62M |
| EBIT | 532.55M | 505.62M | 544.58M | 527.16M | 572.97M | 535.12M | 379.32M | 302.85M | 245.76M | 172.95M | 133.7M | 105.97M | 88.42M | 76.49M | 66.01M | 56.7M | 32.79M | 14.59M |
| Net Interest Income | 8.06M | 15.01M | 46.88M | 51.12M | 10.03M | -1.73M | 3.82M | 8.72M | 3.52M | 4.6M | 4.85M | 4.73M | 4.77M | 3.08M | 1.94M | 1.42M | 486K | 42K |
| Interest Income | 8.06M | 15.01M | 46.88M | 51.12M | 10.03M | 0 | 3.82M | 8.72M | 3.52M | 4.6M | 4.85M | 4.73M | 4.77M | 3.08M | 1.94M | 1.31M | 562K | 227K |
| Interest Expense | 0 | 0 | 0 | 0 | 0 | 1.73M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 37K | 76K | 185K |
| Other Income/Expense | -18.55M | -15.54M | 39.83M | 35.35M | -65.71M | -8.92M | -845K | -3.32M | 4.01M | 1.36M | -7.23M | 103K | 770K | 277K | -143K | -2.22M | -1.7M | -1.57M |
| Pretax Income | 531.86M | 505.62M | 584.41M | 536.59M | 507.26M | 533.39M | 378.48M | 299.53M | 249.77M | 174.31M | 126.47M | 106.07M | 86.95M | 76.77M | 65.86M | 52.79M | 31.09M | 14.41M |
| Pretax Margin % | 9.57% | 9.27% | 12.36% | 11.44% | 10.51% | 14.19% | 14.23% | 13.06% | 13.55% | 12.02% | 10.9% | 11.6% | 11.91% | 13.83% | 15.18% | 15.78% | 14.02% | 9.61% |
| Income Tax | 145.14M | 127.95M | 129.88M | 119.5M | 87.84M | 51.74M | 51.32M | 38.47M | 9.52M | 101.55M | 27.2M | 21.61M | 17.31M | 14.78M | 11.38M | 8.44M | 2.79M | 879K |
| Effective Tax Rate % | 27.29% | 25.3% | 22.22% | 22.27% | 17.32% | 9.7% | 13.56% | 12.84% | 3.81% | 58.26% | 21.51% | 20.38% | 19.91% | 19.25% | 17.28% | 15.99% | 8.96% | 6.1% |
| Net Income | 386.72M | 377.68M | 454.53M | 417.08M | 419.42M | 481.65M | 327.16M | 261.06M | 240.26M | 72.76M | 99.27M | 84.46M | 69.64M | 61.99M | 54.48M | 44.35M | 28.31M | 13.53M |
| Net Margin % | 6.96% | 6.92% | 9.61% | 8.89% | 8.69% | 12.82% | 12.3% | 11.38% | 13.04% | 5.02% | 8.56% | 9.24% | 9.54% | 11.17% | 12.56% | 13.26% | 12.76% | 9.02% |
| Net Income Growth % | -6.08% | -16.91% | 8.98% | -0.56% | -12.92% | 47.22% | 25.32% | 8.66% | 230.2% | -26.7% | 17.54% | 21.27% | 12.34% | 13.78% | 22.84% | 56.68% | 109.25% | - |
| Net Income (Continuing) | 386.72M | 377.68M | 454.53M | 417.08M | 419.42M | 481.65M | 327.16M | 261.06M | 240.26M | 72.76M | 99.27M | 84.46M | 69.64M | 61.99M | 54.48M | 44.35M | 28.31M | 13.53M |
| Discontinued Operations | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Minority Interest | 582K | 582K | 1.94M | 579K | 1.48M | 8.72M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| EPS (Diluted) | 7.14 | 6.72 | 7.84 | 7.06 | 7.09 | 8.15 | 5.60 | 4.53 | 4.24 | 1.32 | 1.87 | 1.62 | 1.40 | 1.28 | 1.17 | 0.29 | 0.75 | 0.22 |
| EPS Growth % | -2.52% | -14.29% | 11.05% | -0.42% | -13.01% | 45.54% | 23.62% | 6.84% | 221.21% | -29.41% | 15.43% | 15.71% | 9.38% | 9.4% | 303.45% | -61.33% | 240.91% | - |
| EPS (Basic) | - | 6.76 | 7.93 | 7.21 | 7.32 | 8.52 | 5.87 | 4.77 | 4.24 | 1.40 | 1.97 | 1.73 | 1.48 | 1.35 | 1.27 | 0.29 | 0.84 | 0.23 |
| Diluted Shares Outstanding | 54.18M | 56.23M | 57.98M | 59.09M | 59.17M | 59.06M | 58.45M | 57.67M | 56.67M | 54.98M | 53.22M | 51.99M | 49.72M | 48.36M | 43.82M | 18.89M | 20.47M | 18.47M |
| Basic Shares Outstanding | 53.79M | 55.89M | 57.29M | 57.83M | 57.29M | 56.51M | 55.73M | 57.63M | 56.66M | 52.08M | 50.31M | 48.72M | 47.19M | 45.75M | 40.19M | 17.12M | 17.09M | 16.72M |
| Dividend Payout Ratio | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - |
Geopolitical delivery footprint disruption
According to recent quarterly filings, EPAM's revenue growth has exhibited significant volatility, fluctuating from a 3.8% contraction in 2024Q1 to a 19.4% expansion by 2025Q3, suggesting that the firm's reliance on discretionary digital transformation projects remains highly sensitive to broader macroeconomic shifts and client budget cycles.
The inconsistent revenue trajectory reflects the company's struggle to maintain momentum while navigating a complex global delivery pivot. Investors should monitor whether the recent return to double-digit growth is sustainable or merely a reflection of easier year-over-year comparisons following previous periods of contraction.
As reported in financial statements, EPAM's gross margin has faced notable pressure, declining from a peak of 34.6% in 2024Q3 to 25.6% in 2026Q1, which likely indicates that the firm is struggling to maintain pricing power while absorbing the costs of its global delivery expansion.
The erosion of gross margins suggests that the company's shift toward new delivery geographies is not yet yielding the expected efficiency gains. This trend implies that the firm may be facing a structural mismatch between its billable headcount growth and the actual utilization of its engineering talent.
Based on the provided income statement data, EPAM's operating margin has contracted to 8.5% in 2026Q1 from a high of 15.2% in 2024Q3, demonstrating that the company is currently failing to achieve meaningful operating leverage as administrative and relocation costs continue to outpace revenue growth.
The inability to scale operating income alongside revenue suggests that the firm's cost structure remains bloated by non-recurring expenses related to its geographic diversification. Analysts should investigate whether these administrative burdens are becoming a permanent feature of the operating model rather than temporary transition costs.
Data from recent filings suggests that EPAM's reliance on high-end engineering may be losing its competitive edge, as evidenced by the significant volatility in EPS and the compression of net margins to 5.9% in 2026Q1, which may concern investors regarding the firm's long-term pricing power.
Short-term observers might argue that the company's pivot to new delivery hubs is diluting the very engineering rigor that once justified its premium valuation. If the firm cannot successfully integrate these new regions without further margin degradation, the market may continue to apply a persistent discount to its shares.
Quick answers to the most common questions about buying EPAM stock.
For fiscal year 2025, EPAM Systems, Inc. (EPAM) reported total revenue of $5.46B. This represents a 3539.5% increase compared to $149.9M in 2009.
EPAM Systems, Inc. (EPAM) is profitable, generating $377.7M in net income for the fiscal year ending 2025 with a net profit margin of 6.9%.
EPAM Systems, Inc. (EPAM) reported an operating income of $521.2M, resulting in an operating profit margin of 9.6%. This margin reflects the operational efficiency of the business before interest and taxes.
EPAM Systems, Inc. (EPAM) generated $1.45B in gross profit for the year, representing a gross profit margin of 26.5%. This demonstrates the company's core pricing power and production efficiency.