ISG Aims To Boost Revenue After Share Prices Fall

Information Services Group (ISG), a leading global technology research and advisory firm, believes that the recent pandemic can actually boost its bottom-line next year.

Founded in 2006, the Connecticut-based company specializes in digital transformation services, including automation, cloud and data analytics, sourcing advisory, managed governance and risk services, network carrier services, strategy and operations design, change management, market intelligence, and technology research and analysis. It currently has more than 700 clients, including over 75 of the world's top 100 enterprises, and employs more than 1,300 employees in over 20 countries.

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The company went public in 2007, and over the past five years its stock has fallen 51 percent—with its share price down 21 percent over the last 90 days. Like many companies, ISG also saw a disruption in their services due to the COVID-19 pandemic.

However, the company reported solid Q2 2020 financial results, showing a record cash flow from operations. Revenue was at $57.4 million, with an adjusted EBITDA of $7.4 million, both exceeding guidance. Its cash flow from operating activities hit $22 million, with $47 million of cash flow from operating activities over the last twelve months.

“Revenues, though down sequentially due to the pandemic, exceeded our expectations, and through our disciplined operational execution and higher-margin mix of products and services, our adjusted EBITDA more than doubled from the prior quarter and we generated a record $22 million of cash. This allows us to continue to invest in our business and our people,” said Michael P. Connors, chairman and CEO.

Connors added that the company expects the pandemic to actually cause an increase in digital transformations next year, leading to more business opportunities for ISG.

In the meantime, the company is still making moves in 2020. In July, ISG acquired Neuralify, a market leader in intelligent automation enablement solutions and services. The deal expands the capabilities of ISG’s pure-play automation business, ISG Automation, which offers a range of intelligent automation consulting, implementation, and software services. Neuralify’s client base includes major blue-chip companies, 40 of which are not currently served by ISG Automation.