- Company name
- EPAM Systems
- Sector
- IT services & software engineering
- About
- EPAM Systems builds software for large companies. It designs, builds and runs digital platforms, data systems and AI tools for its clients, and it also gives consulting services. Its largest client groups are in financial services, software and technology, consumer goods and retail, business information and media, and life sciences and healthcare. Most clients are in North America and Europe. Revenue was $5.46 billion in 2025. EPAM had about 63,650 employees at September 30, 2026, and about 57,350 of them were delivery professionals. India is its largest delivery location. At December 31, 2025, about 14,100 of its employees were in Ukraine and Belarus. Balazs Fejes became Chief Executive Officer in September 2025, and the founder, Arkadiy Dobkin, is Executive Chairman.
- Thesis
- The market prices EPAM for the risk that AI tools reduce the number of engineering hours that clients pay for. EPAM sells most of its work by time and effort, so fewer hours can mean less revenue. EPAM cut its 2026 organic constant currency growth outlook three times: from 3% to 6% in February, to 2.5% to 5.0% in May and to 2.0% to 3.0% in August 2026. In November 2026, it narrowed the outlook to 2.5% to 2.7%, but it expects organic growth of only 0.5% to 1.6% in Q4 2026. EPAM now returns more cash: it plans a $500 million accelerated buyback in November 2026 and commits to return at least 50% of free cash flow each year from 2027 to 2029. For the gap to close, three things must be true. Revenue growth must stop slowing and move up again in 2027, which shows that AI work replaces the hours that clients cut. The non-GAAP operating margin must stay in the 15.9% to 16.1% range of the 2026 outlook or rise. Operating cash flow must stay positive, as in Q3 2026, to fund the buybacks. The full-year report and the 2027 outlook, expected in February 2027, are the main test. If these checks pass, the gap can close over the next four to six quarters. The main reason it may not close is that AI lowers the demand for paid engineering hours faster than EPAM can sell new AI work.
- Risks
- AI coding and testing tools can do part of the work that clients now pay EPAM to do by the hour. If clients cut hours faster than EPAM sells new AI projects, revenue can fall. EPAM cut its 2026 growth outlook three times in 2026.
About 14,100 employees were in Ukraine and Belarus at December 31, 2025. The war in Ukraine can disrupt delivery, and clients can move work away from the region.
Operating cash flow was only $250.1 million in the first nine months of 2026, against $372.0 million a year earlier, and cash fell by $331 million in nine months after buybacks. EPAM borrows on its credit facility for part of the $500 million accelerated buyback that it signed on November 9, 2026. If collections weaken again, it has less cash for buybacks and acquisitions.
Most clients are in North America and Europe and in sectors such as financial services and consumer goods. A weaker economy can make clients delay new projects.
- Balance sheet
- Cash: $970M
Debt: $25M
Net cash: $945M
Undrawn credit line: $675M, to October 2030
Last debt due: 2030
EPAM has net cash. At September 30, 2026, it had cash and cash equivalents of $965.2 million and short-term investments of $4.6 million. Its only debt was $25.0 million drawn on its $700 million revolving credit facility, which matures on October 3, 2030, so $675.0 million was available. Cash fell from $1.30 billion at December 31, 2025, because EPAM spent about $489 million on buybacks in the first nine months of 2026, more than its operating cash flow of $250.1 million. On November 9, 2026, EPAM signed a $500 million accelerated buyback, which it pays with cash and borrowings under the credit facility, so its debt will rise. Interest expense is small.
As of Sep 30, 2026.
- Checkpoints
- Nov 5, 2026: Q3 2026 results: growth and cash flow. Passed. Watch: Revenue at or above the $1.410 billion to $1.425 billion outlook, a non-GAAP operating margin of 15.5% or more and positive operating cash flow pass; a lower outlook or more negative cash flow fails. Outcome: Revenue was $1.426 billion, the non-GAAP operating margin was 16.7% and operating cash flow was $288.8 million.
Feb 5, 2027 (estimate): 2027 outlook: does growth move up again. Pending. Watch: A 2027 organic constant currency growth outlook above the 2.0% to 3.0% of 2026 passes; an outlook for slower growth fails.
- Recent events
- Nov 9, 2026: EPAM signed a $500 million accelerated share repurchase agreement with UBS under its $1.8 billion buyback program. It expected an initial delivery of 2,550,695 shares by November 10, 2026, and final settlement in Q1 2027. EPAM pays with cash on hand and borrowings under its credit facility.
Nov 5, 2026: EPAM reported Q3 2026 results. Revenue rose 2.3% to $1.426 billion, and organic constant currency growth was 2.5%. The non-GAAP operating margin rose to 16.7% from 16.0%, and non-GAAP EPS rose 14.0% to $3.51. Operating cash flow was $288.8 million. EPAM narrowed its 2026 organic constant currency growth outlook to 2.5% to 2.7% and raised its non-GAAP EPS outlook to $13.23 to $13.31. The board approved a new buyback program of up to $1.8 billion through 2029. EPAM plans a $500 million accelerated buyback in the week of November 9, 2026, and it commits to return at least 50% of free cash flow to shareholders each year from 2027 to 2029.
Aug 31, 2026: The activist fund Engine Capital made public a letter to the EPAM board. Reuters reported that the fund owns about 1.5% of EPAM. The letter asks EPAM to use its cash, future free cash flow and debt for much larger buybacks. If the board does not do this, the fund wants a formal strategic review, which can include a sale of the company. It also asks for new independent directors and a capital allocation committee.
Aug 6, 2026: EPAM reported Q2 2026 results. Revenue rose 4.5% to $1.415 billion, and organic constant currency growth was 3.4%. The non-GAAP operating margin rose to 16.4% from 15.0%, and non-GAAP EPS rose 22% to $3.38. EPAM lowered its 2026 revenue growth outlook to 3.2% to 4.2%, and its organic constant currency outlook to 2.0% to 3.0%. It raised its non-GAAP EPS outlook to $13.08 to $13.24.
May 21, 2026: At the annual meeting, shareholders approved a change to the certificate of incorporation that lets shareholders call a special meeting. They also approved 4,000,000 more shares for the long-term incentive plan.
May 7, 2026: EPAM reported Q1 2026 results. Revenue rose 7.6% to $1.400 billion, and organic constant currency growth was 3.7%. Non-GAAP EPS was $2.86. EPAM spent $324 million on buybacks in the quarter. It lowered its 2026 organic constant currency growth outlook to 2.5% to 5.0%.
Mar 4, 2026: EPAM agreed with Morgan Stanley to buy back $300 million of its shares through an accelerated share repurchase. It received an initial 1,703,336 shares. It paid with cash on hand and borrowings under its credit facility.
Feb 19, 2026: EPAM reported Q4 and full-year 2025 results. Revenue for 2025 rose 15.4% to $5.457 billion, and non-GAAP EPS rose 5.9% to $11.50. For 2026, EPAM expected revenue growth of 4.5% to 7.5% and organic constant currency growth of 3% to 6%.