EPAM Systems, Inc. (EPAM) SEC Filings & Earnings Calls

Ukraine/Russia exposure

“As of June 30, 2026, the Company had $62.7 million of Property and equipment, net in Ukraine” · word for word

Belarus cash restrictions

“Belarus instituted restrictions on distributing dividends from Belarus to shareholders in certain countries, including the U.S.” · word for word

Negative operating cash flow

“Net cash provided by (used in) operating activities ($38,784)”

Cash used in operations of $38.8M in H1 2026 vs $77.4M provided in H1 2025, indicating working capital pressure.

“Cash used in operating activities was $38.8 million for the first six months of 2026, compared to cash provided by operating activities of $77.4 million” · word for word

Cash balance decreased 39% to $794.3M due to share repurchases.

“Cash, cash equivalents and restricted cash totaled $794.3 million as of June 30, 2026, a decrease of $507.1 million, or 39.0%” · word for word

Potential dilution from equity compensation plans.

“Increase in shares available for issuance under equity plans.”

Geopolitical risk from Ukraine and Belarus operations

“As of March 31, 2026, the Company had $63.5 million of cash and cash equivalents in banks in Ukraine and $50.0 million of cash and cash equivalents in banks in Belarus.” · word for word

Foreign exchange translation risk

“Foreign exchange gain (loss) $2,298 (2026) vs ($10,727) (2025)”

High share repurchase leverage

“Debt increased from $25M to $165M to fund share repurchases; operating cash flow turned negative.”

Cash flow negative in Q1 due to buyback and working capital; operating cash flow -$36.4M vs +$24.2M prior year.

“Cash used in operating activities was $36.4 million for the first three months of 2026, compared to cash provided by operating activities of $24.2 million” · word for word

Stockholder proposal risk

“Stockholder proposal seeks 10% threshold for special meetings, which Board opposes, recommending 25% threshold.”

Equity dilution risk

“Board seeks 4,000,000 additional shares for LTIP and 650,000 for ESPP; current shares outstanding 52,444,312.”

Key person dependency on senior technical leadership; retention grant indicates potential flight risk.

“Grant approved to provide significant incremental long-term incentive to retain Mr. Dvorkin as an executive.”

Forward-looking statements subject to risks including Ukraine war, AI adoption, and macroeconomic conditions.

“Safe harbor statement highlights risks related to war in Ukraine, AI adoption, global capital markets, and foreign exchange.”

AI disruption to business model

“If comparable services can be performed less expensively using AI, clients may seek other service providers or expect price concessions to retain their business, which could adversely affect our financial results.” · word for word

Geopolitical concentration risk

“approximately 14,100 of our global delivery, administrative and support personnel were based in Ukraine and Belarus” · word for word

Wage inflation pressure

“Wages for technology professionals in the emerging markets where we have significant operations and delivery centers are typically lower than comparable wages in more developed countries. However, wages in general, and in the technology industry in emerging markets in particular, have increased” · word for word

GAAP net income declined 14.3% in FY2025 due to higher amortization and stock-based compensation.

“GAAP Diluted EPS of $6.72, a decrease of 14.3%” · word for word

Margin Compression from Acquisitions

“Income from operations as a percentage of revenues decreased to 9.2% for the nine months ended September 30, 2025 as compared to 11.7% for the nine months ended September 30, 2024, largely driven by lower government incentives related to conducting R&D activities in Poland and an increase in cost of revenues (exclusive of depreciation and amortization) as a ” · word for word

Dependence on Government Incentives

“The increase primarily resulted from the acquisitions of NEORIS and First Derivative in the fourth quarter of 2024, higher variable compensation expense, and a $38.8 million decrease in government incentives recognized in the third quarter of 2025 compared to the third quarter of 2024 related to conducting R&D activities in Poland.” · word for word

GAAP margin compression due to AI investments and headcount growth

“GAAP operating margin declined from 14.8% to 10.4% YoY”

Operating cash flow decline in first nine months

“Cash from operations $372M vs $428.9M in 9M 2024, down 13.3%”