(Montreal) The vast majority of large companies are considering the use of artificial intelligence in their business processes, but they seem to approach new technology with “cautiousness”, says the big boss of the tech company information CGI.
Two-thirds of CGI clients research or demonstrate proof of concept related to artificial intelligence, according to a recent survey conducted by the company. About 15% adopted “some threshold of implementation” while 20% did nothing in this regard.
CGI President and CEO George Schindler isn’t worried about his clients putting contracts on hold to assess their AI needs.
During a conference call on Wednesday to discuss second-quarter results, Schindler points out that artificial intelligence could integrate into products and services already offered by the company. “People are evaluating this technology with caution and are looking to partners like CGI to help with their thinking. »
There are still many questions about how artificial intelligence will be adopted by large corporations, acknowledges the leader. “Of course there are concerns about cybersecurity and privacy. There will probably be new regulations. You also see concerns about the protection of intellectual property. »
CGI does not see artificial intelligence as a replacement for professionals. “The idea is to make experts more productive. We have use cases, but it is always assisted by a human. »
Despite signs of an economic downturn, CGI management continues to be optimistic about the company’s prospects. The company also announced financial results that exceeded expectations for the second quarter ended March 31.
Discussions with customers lead Schindler to believe that demand is resilient. However, he acknowledged that companies are assessing their IT needs more cautiously. “The demand is still there, but it’s more intentional with more focus on return on investment. »
Analyst Daniel Chan of TD Securities believes that the environment remains favorable for CGI. “We believe the current environment will continue to support demand for outsourcing, which CGI should benefit from. Its growth, strong margins and orders, and a diversified business model are why CGI’s stock remains one of our favourites. »
The CGI boss was also asked about concerns about midsize banks in the United States and the effect on his clients in the sector. He mentioned that a majority of his clientele came from large banks.
“They are more open to outsourcing certain technology services, not so much because of disruptions in the banking sector, but because of the difficulty in finding professionals. »
In the second quarter, CGI announced a net profit of 419.4 million, up 12.7% compared to the same period last year. Adjusted diluted earnings per share were $1.82, down from $1.53.
Revenues for the Montreal-based company rose 13.7% to $3.72 billion. Excluding currency variation, revenues would have increased by 11.4%.
The company’s order book reaches 25.24 billion, which is 1.8 times its annual revenue.
Prior to the earnings release, analysts had expected earnings per share of $1.72 and revenue of $3.56 billion, according to financial data firm Refinitiv.
CGI shares rose $3.71, or 2.79%, to $136.50 on the Toronto Stock Exchange in the morning.
