GRID DYNAMICS HOLDINGS, INC. (GDYN): Results of Operations and Financial Condition
GRID DYNAMICS HOLDINGS, INC. (GDYN) filed an SEC Form 8-K — Results of Operations and Financial Condition. Exhibit 99.1 Grid Dynamics Reports Second Quarter 2026 Financial Results Revenues of $108.2 million and Record AI Revenues of 30.7% San Ramon, Calif. — July 30, 2026 – Grid Dynamics Holdings, Inc. (Nasdaq: GDYN) (“Grid Dynamics” or the “Company”), a leader in enterprise-level AI
How this was made
The 30-second read
Why it matters
Traders can update near-term revenue and non-GAAP EBITDA expectations using the provided ranges, and reassess margin progress toward the stated 300 bps commitment.
Market read
A guidance-backed earnings release with a revenue beat and explicit forward ranges typically drives same-day estimate revisions and positioning for the next earnings cycle.
What to watch
The company does not provide GAAP net income targets for Q3 due to excluded items, which can increase uncertainty around bottom-line durability despite non-GAAP EBITDA guidance.
Grid Dynamics Reports Second Quarter 2026 Financial Results Revenues of $108.2 million and Record AI Revenues of 30.7%
Revenue of $108.2 million was slightly above the high end of the Company's $106.0 million to $108.0 million guidance range, with 7.0% year-over-year growth, sequential gross-margin expansion, and higher non-GAAP net income and EBITDA. GAAP net income declined from the second quarter of 2025 and cash provided by operating activities declined for the six months ended June 30, 2026.
Key metrics
as reported| Metric | Value | q/q | y/y |
|---|---|---|---|
| Total revenuesGAAP | $108.2 million | up 3.9% | up 7.0% |
| AI revenuesother | 30.7% | – | – |
| GAAP gross profitGAAP | $39.6 million, or 36.6% of revenues | – | – |
| Non-GAAP gross profitnon-GAAP | $40.0 million, or 36.9% of revenues | – | – |
| GAAP net incomeGAAP | $2.9 million, or $0.03 per share, based on 83.0 million diluted weighted-average common shares outstanding | – | – |
| Non-GAAP net incomenon-GAAP | $9.0 million, or $0.11 per diluted share, based on 83.0 million diluted weighted-average common shares outstanding | – | – |
| Non-GAAP EBITDAnon-GAAP | $14.7 million | – | – |
| Cash provided by operating activitiesGAAP | $14.5 million for the six months ended June 30, 2026 | – | – |
| Cash and cash equivalentsGAAP | $298.4 million as of June 30, 2026 | – | – |
| Total headcountother | 4,838 as of June 30, 2026 | – | – |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| Technology, Media and Telecomstrong demand from our largest technology customers | 31.8% of the second quarter revenues | 11.7% sequentially | increased 36.4% year-over-year |
| Retailrobust demand from key accounts | 26.5% of total revenues for the second quarter of 2026 | – | – |
| Financeongoing demand from our financial services engagements | 22.9% of the second quarter revenues | – | – |
| Consumer Packaged Goods and Manufacturing | 10.9% of quarterly revenues | increased 2.1% sequentially | – |
| Healthcare and Pharma | 1.9% of the total second quarter revenues | – | – |
| Other | 6.0% of the total second quarter revenues | – | – |
Third Quarter 2026 and Full Year 2026 outlook
- RevenueThird quarter of 2026: $112.0 to $114.0 million; full-year 2026: $435.0 to $465.0 million
- NoteNon-GAAP EBITDA in the third quarter of 2026 is expected to be between $16.5 and $17.5 million.
- NoteFor the third quarter of 2026, we expect our basic share count to be in the 81 - 82 million range and diluted share count to be in the 83 - 84 million range.
- NoteGrid Dynamics is not able, at this time, to provide GAAP targets for net income/(loss) for the third quarter of 2026.
What drove it
- AI revenue crossed 30% of total company revenue for the first time and grew over 50% year-over-year for a second consecutive quarter.
- Technology, Media and Telecom was the principal growth driver, supported by strong demand from the Company's largest technology customers.
- Retail demand was robust from key accounts, while Finance was supported by ongoing demand from financial services engagements.
- Productivity gains from AI-Native Delivery and disciplined cost-control execution were cited as contributors to margin expansion.
- The Company added Ekumen to strengthen Physical AI capabilities.
Concerns
- GAAP net income was $2.9 million, compared to $5.3 million in the second quarter of 2025.
- Cash provided by operating activities was $14.5 million for the six months ended June 30, 2026, compared to $23.7 million for the six months ended June 30, 2025.
- The Company's revenues are highly dependent on a limited number of clients and industries.
- The Company cited macroeconomic conditions, inflationary pressures, risk of recession, tariffs, world trade factors, and geopolitical conditions as risks.
What to watch
- Third-quarter revenue delivery against the $112.0 to $114.0 million outlook.
- Third-quarter non-GAAP EBITDA delivery against the $16.5 to $17.5 million outlook.
- Progress toward the Company's 300 basis point margin commitment.
- Sustained growth in AI revenue and broader enterprise deployment of AI workloads from pilots to production.
- Demand trends among the Company's largest technology customers, key retail accounts, and financial services engagements.
Balance sheet and cash flow
- Cash provided by operating activities was $14.5 million for the six months ended June 30, 2026, compared to $23.7 million for the six months ended June 30, 2025.
- Cash and cash equivalents totaled $298.4 million as of June 30, 2026, compared to $342.1 million as of December 31, 2025.
- Total headcount was 4,838 as of June 30, 2026, compared with 5,013 as of June 30, 2025.
Analysis
Grid Dynamics reported second-quarter revenue of $108.2 million, up 7.0% year-over-year and 3.9% sequentially. Revenue was slightly above the high end of the $106.0 million to $108.0 million guidance range cited in the release. AI revenues were reported at 30.7% in the headline, while management said AI revenue crossed 30% of total company revenue for the first time and grew over 50% year-over-year for a second consecutive quarter.
The revenue mix was concentrated in Technology, Media and Telecom, which represented 31.8% of second-quarter revenues and grew 36.4% year-over-year and 11.7% sequentially. Retail contributed 26.5% of total revenues, and Finance contributed 22.9%. Management identified technology and financial services as its most strategic customer relationships and attributed TMT growth to strong demand from its largest technology customers.
Margins improved year over year. GAAP gross profit was $39.6 million, or 36.6% of revenues, compared with $34.5 million, or 34.1% of revenues, in the second quarter of 2025. Non-GAAP gross profit was $40.0 million, or 36.9% of revenues, compared with $35.1 million, or 34.7% of revenues. Non-GAAP EBITDA increased to $14.7 million from $12.7 million, and non-GAAP net income increased to $9.0 million from $8.3 million. In contrast, GAAP net income was $2.9 million, compared with $5.3 million in the prior-year quarter.
Cash provided by operating activities was $14.5 million for the six months ended June 30, 2026, compared with $23.7 million in the prior-year six-month period. Cash and cash equivalents totaled $298.4 million as of June 30, 2026, compared with $342.1 million as of December 31, 2025, while total headcount was 4,838 compared with 5,013 a year earlier. The Company gave third-quarter revenue guidance of $112.0 to $114.0 million and non-GAAP EBITDA guidance of $16.5 to $17.5 million, while retaining a full-year 2026 revenue outlook of $435.0 to $465.0 million.
Management, verbatim
We delivered another solid quarter. Revenue came in above the high end of our guidance range. AI revenue crossed 30% of total company revenue for the first time and grew over 50% year-over-year for a second consecutive quarter.
Leonard Livschitz, Chief Executive Officer
Our AI-based GAIN platforms are winning wider enterprise adoption as clients transition enterprise AI workloads from pilots to production.
Leonard Livschitz, Chief Executive Officer
Margin expansion continues to be a top priority. Productivity gains from AI-Native Delivery are showing up in our results. So is disciplined cost-control execution.
Leonard Livschitz, Chief Executive Officer
Not in the filing
stated, not guessed- GAAP operating income or loss
- Non-GAAP operating income or loss
- GAAP operating margin
- Non-GAAP operating margin
- Free cash flow
- Debt balances
- Share repurchases
- Dividends
- Segment revenue amounts in dollars
- Year-over-year or sequential growth for Retail
- Year-over-year or sequential growth for Finance
- Year-over-year growth for Consumer Packaged Goods and Manufacturing
- Year-over-year or sequential growth for Healthcare and Pharma
- Year-over-year or sequential growth for Other
- Third-quarter gross-margin guidance
- Third-quarter operating-expense guidance
- Third-quarter tax-rate guidance
- Full-year 2026 EBITDA guidance
- Full-year 2026 GAAP net income or loss guidance
- Prior outlook section for formal comparison with reported results
AlphaAI analysis generated from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was cross-checked against the filing text; consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.
Background
The 8-K (Item 2.02) includes Grid Dynamics’ Q2 2026 results and management’s outlook for Q3 and full-year 2026.
Ticker impact
Grid Dynamics reported Q2 2026 revenues of $108.2M, above the April guidance high, and guided Q3 revenues to $112.0M-$114.0M.
Likely positive bias for the next session as traders reprice growth and margin trajectory toward the stated 300 bps margin commitment.
This is a primary SEC 8-K earnings release with beat vs guidance and forward-looking numeric ranges (Q3 revenues, Q3 non-GAAP EBITDA, full-year revenues).
Market effects
Reinforces demand narrative for enterprise AI transformation and AI delivery productivity, potentially supportive for AI services peers’ sentiment.
Limited direct regional read-through; company is US-listed with global delivery footprint.
Modest global relevance, mainly through enterprise AI spending signals rather than macro policy.
Counterpoint
GAAP net income declined year over year, and operating cash flow for six months fell, so the quality of earnings and cash generation may temper the enthusiasm.
Key entities
- companyGrid Dynamics Holdings, Inc.
Nasdaq-listed enterprise AI and digital transformation provider reporting Q2 results and issuing Q3 and full-year guidance.
- personLeonard Livschitz
CEO quoted on AI revenue mix, enterprise adoption, Physical AI expansion, and margin commitment progress.
