French Call Center Faces AI and U. S. Government Hurdles

Slower Revenue Growth Predicted

A French call center company, previously known as Teleperformance, has revised its financial expectations for 2025. The new outlook forecasts a slower revenue growth, now between 1% and 2%, down from the earlier estimate of 2% to 4%. Additionally, the company has lowered its operating margin target to a range of 14.7% to 15%, from the previous 15% to 15.1%.

Challenges from Artificial Intelligence

The company is not alone in facing these challenges. Many call centers are feeling the pressure from artificial intelligence, which can handle tasks previously done by human agents. This shift has raised concerns among analysts and investors about the company's ability to grow in an era of AI advancements.

Impact of U.S. Government Shutdown

One of the company's divisions, LanguageLine Solutions, provides interpretation services to U.S. government agencies. This part of the business has been affected by reduced demand and payment delays due to a U.S. government shutdown. The deputy CEO, Thomas Mackenbrock, explained that the shutdown impacts their services directly and indirectly. He noted that the Congressional Budget Office also expects a negative effect on consumer sentiment, which could further complicate the situation.

Cautious Financial Management

The company's cautious approach is evident in the words of its CFO, Olivier Rigaudy, who stated that their clients are being careful, and so must they be. This sentiment reflects the broader economic uncertainties and the need for prudent financial management.

Revised Financial Targets

In July, the company had already adjusted its revenue growth outlook to the lower end of the previously guided range of 2% to 4%. The third quarter saw revenue of 2.51 million euros, equivalent to approximately $2.92 billion. The company has also revised its free cash flow target down to 900 million euros from the initially projected one billion euros.