Monitor U.S. Federal revenue trajectory—continued declines could pressure overall growth. The aggressive buyback program supports EPS but does not offset weak organic expansion. Watch for further acquisitions or organic recovery in H2.
Price Chart
Executive Summary
CGI reported Q2 FY2026 revenue of $4.16B (+3.3% reported, +1.6% constant currency), with diluted EPS of $2.09 (+10.6%) driven by share buybacks and margin stability. Organic growth was minimal, with U.S. Federal revenue declining 11.1% due to government efficiency initiatives. Adjusted EBIT margin improved 10 bps to 16.6%. The results are mixed: top-line deceleration and U.S. Federal headwinds offset by strong EPS accretion and healthy cash generation.
Key Facts
- Revenue $4,156.2M, up 3.3% YoY; constant currency growth 1.6%
- Net earnings $444.7M, up 3.5%; diluted EPS $2.09 vs $1.89
- Adjusted EBIT $691.6M, up 3.9%; margin 16.6% vs 16.5%
- U.S. Federal revenue down 11.1% YoY to $511.6M
- Bookings $4.31B, book-to-bill 103.8%; backlog $31.5B
- Cash from operations $451.1M, 10.9% of revenue
- NCIB repurchases $396.9M in Q2; dividend $0.17/share
- Net debt to capitalization 26.3% vs 24.1% a year ago
Financial Impact
Revenue growth of $132.8M YoY, EPS accretion of $0.20, share buybacks of $396.9M
Risk Factors
- U.S. federal government efficiency initiatives may further reduce revenue
- M&A integration costs and temporary dilutive impact on margins
- Rising net finance costs due to higher debt levels
Market Snapshot
Investment Themes
Documents Analyzed
This report is based on 7 SEC documents filed with EDGAR.
| Document | Accession Number |
|---|---|
| 6-K Filing (Primary) | 0001061574-26-000012 |
| Document: skeletonfsq2fy26.htm | 0001061574-26-000012 |
| Document: cgi-fy26_q2xpressrelease.htm | 0001061574-26-000012 |
| Document: cgi_form-6xkxq2fy2026xmdaf.htm | 0001061574-26-000012 |
| Document: 0001061574-26-000012-index-headers.html | 0001061574-26-000012 |
| Document: 0001061574-26-000012-index.html | 0001061574-26-000012 |
| Document: 0001061574-26-000012.txt | 0001061574-26-000012 |
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