Shares of Concentrix fell after reporting mixed fiscal third-quarter results on Tuesday, as the company navigates a costly shift toward artificial-intelligence-powered customer-service tools.
About 50% of Concentrix’s revenue is coming from business it earned since introducing AI tools three years ago, CEO Chris Caldwell said in a news release. That follows up on a 400% year-over-year surge in deals for its AI tools suite the prior quarter, as Caldwell touted the company’s “acceleration in many areas in the evolution of our business” at the time.
Caldwell said Tuesday the company is “aggressively disrupting our own traditional business,” and that its “underlying new business is stronger and healthier,” citing strong free cash flow and services growth.
Concentrix stock fell 10.8% in after-hours trading after ending Tuesday down 2.2% to $24.88, its lowest close since Aug. 18. The stock is down 18% over the last five sessions, its worst five-day stretch since the five days ending April 27, according to Dow Jones Market Data.
Concentrix, a firm that runs AI- and human-powered customer service and back-office operations for businesses, posted adjusted earnings of $2.92 a share for the quarter ended Aug. 31. That surpassed Wall Street’s estimates of $2.71, according to FactSet. Revenue fell 1.2% year over year to $2.45 billion, falling just short of estimates of $2.47 billion.
Concentrix has faced rising costs as it reshapes its business around AI and away from the traditional outsourcing model. The company previously estimated restructuring expenses of $175 million in fiscal 2026. It reported an operating loss of $910 million in the third quarter, up 519% year over year.
A broader transition toward AI-powered customer service has rattled the industry.
Peer Teleperformance rebranded itself as TP last year, saying it would be “powered by [emotional intelligence] and enabled by AI.” The company said in July it planned to have its entire workforce using AI tools by 2027. Paris-traded TP shares were flat Tuesday.
Customer service representative employment in the U.S. is expected to shed 142,000 jobs by 2030, representing a projecting decline of about 5% since 2025 thanks to the implementation of automation tools, according to Bureau of Labor Statistics data.