Analytics, enterprise resource planning implementations and strategy engagements are driving strong revenue growth at solution provider powerhouse Perficient, CEO Jeffrey Davis told CRN.
In an interview conducted over email, Davis, who is also chairman of St. Louis-based Perficient, discussed what fueled the growth reported in the company’s latest quarterly financial report.
Davis says that Perficient — No. 55 on CRN’s Solution Provider 500 for 2020 — has dispelled concerns about COVID-19 negatively affecting contracts and seen major demand from customers for digital technologies to improve business operations.
Perficient added a numerous new customers in the last six months, which Davis expects will ramp up throughout 2021.
“We’re seeing businesses pursue digital transformation work that enables them to be more nimble, efficient, and effective while improving the customer experience at every interaction – and that certainly includes a lot of work around cloud strategy, development and migrations,” Davis told CRN. “It’s never been more important for businesses to embrace digital and implement tools, systems and processes that increase agility.”
Perficient — a top partner of vendors including Microsoft, IBM, Adobe, Salesforce and Oracle — reported business growth for the fourth quarter, ended Dec. 31.
The company’s largest verticals include health care, while in financial services, the solution provider is “penetrating that market more,” Davis said during the call with analysts.
For retail — another key vertical for Perficient — customers had to adopt new digital strategies and technologies quickly to survive during the economic upheaval caused by the pandemic.
As an example, Davis told CRN that Perficient worked with an international retailer and distributor of professional beauty supplies to implement a new order management system platform. The platform allowed for split shipment and automation capabilities, which integrated with their existing technologies and website.
“This included introducing multiple order fulfillment capabilities, like ship-from-store and same-day delivery, to hundreds of store locations,” Davis told CRN. “As a result, we were able to help the retailer realize a 600 percent order volume increase in certain product categories and a 100 percent ROI in only a few months.”
The pandemic has also expedited retail and business-to-business customers expecting an easy digital experience with companies that didn’t have to worry about such things before, affecting companies in manufacturing, financial services and health care, Davis said in his email comments to CRN.
Perficient was hired by a nonprofit health insurance provider to overhaul the provider’s outdated website, mobile site and customer portal, all of which severely lacked features and capabilities users demand, he said.
“However, after getting a better grasp of the full scope of our services and solution expertise, we were asked to partner on a much broader transformation project, which includes experience design and cloud services,” Davis said.
For the fourth quarter, Perficient saw its total revenue increase 12 percent to $162.6 million, compared to the same period a year earlier. The quarter included 70 deals worth more than $500,000, compared to 65 during the same quarter of 2019.
For 2020 overall, Perficient saw total revenue increase 8 percent to $612.1 million, year over year.
Perficient expects revenue for its current quarter, Q1 of 2021, to be in the range of $165 million to $168 million — up from $145.6 million in the first quarter of 2020.
Full year revenue for 2021 is expected to reach between $670 million and $704 million, an increase of between 10 to 15 percent over 2020.
“Our colleagues doubled down on their commitment to our clients and our company and the result was accelerating revenue growth, record adjusted earnings and aggressive global expansion,” Davis said during the call with analysts. “Given the uncertainty that was beginning to unfold a year ago at this time, I believe our 2020 results say quite a bit about what Perficient is capable of and also where we’re headed.”
A key factor driving Perficient’s margin expansion has been the company’s “increasing leverage of global delivery teams,” Davis told CRN.
“Talented colleagues around the globe are helping us rapidly scale, increase speed to market and remain cost-competitive,” he said. “Throughout 2020, despite the pandemic, our fully integrated global pursuit and delivery model helped us win customers and projects by consistently providing stability, security, and quality across teams, technologies and time zones.”RELATED TOPICS:
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