Bryan Bergin: Okay, appreciate all the detail. Thank you.
Operator: Thank you. Our next question comes from Moshe Katri with Wedbush Securities. Your line is open.
Moshe Katri: Thanks for taking my question. The comment on pricing, is it kind of a function of renewals, is it on the–I think you mentioned it also includes the new deal flow, and then is there a way to kind of quantify the overall pricing pressure that you’re seeing this year? Maybe in that context, it is also a function of the shift in execution more towards offshore, so obviously you have some cannibalization there?
Guo Xiao: Sure, thank you Moshe. As Erin mentioned earlier, the pricing dynamic mostly was driven by a lot of contract renewals and extensions, sometimes expansions by the year end. We talked to our clients, we recognized their budget constraints, and then we are working with them to resolve that. Now, I mentioned briefly earlier that we closed quite a few large deals on top of our list of closed in Q4 and early Q1, and some of these are new deals, like an airline client, a manufacturing client, a large retailer; but many of these are large extensions to our top automobile clients, public sector clients, and a business services client. They’re all in the Fortune 500 company type, all these deals are in the $10 million to $40 million range, large deals, so we feel good about the win rate on these large deals, but they come with a price on pricing.
That said, I think we are seeing–excluding the shift mix to offshore, we are seeing high single digit year-on-year, like-to-like pricing declines, but we also believe that the new pricing dynamic is already reflected in a majority of our contract portfolio, and further decline in pricing from Q1 to Q2, or going onwards further than that, should be much less significant, and so we do expect that to stabilize.
Moshe Katri: Understood. Then my usual question is about APAC. Maybe we can talk a bit about what you’re seeing there in terms of the three geographies there: Australia, Singapore, China, and given the magnitude of the declines on a relative basis versus other regions, it seems that it’s probably doing a bit better than North America and Europe. Is that the right way of looking at it?
Guo Xiao: It is, and thank you for noticing that. We have always, I think, felt that early on during the year, during the macro downturn, we saw a bigger impact from APAC, but also we felt good about the diversification of our portfolios across geographies. Across the three main markets in APAC, Singapore is seeing very healthy growth, it has been seeing that consistently over the last few quarters. China is recovering but because of economic growth is not as fast as people expected in local markets, we’re seeing a slower rebound of the local market growth on the back of the economic growth after COVID. At the same time, I think we have seen more signs of recovery and discretionary spending returning from Australia, given that it was the first market that went into this macro headwind about two years ago.
We’re definitely glad that it’s returning and that we’re seeing signs of growth there. I think, as you already pointed out, that APAC is performing better at this moment than other markets.
Moshe Katri: Understood, thank you.
Guo Xiao: Thank you Moshe.
Operator: Thank you. Our next question comes from Jason Kupferberg with Bank of America. Your line is open.
Tyler DuPont: Hi, good morning Xiao and Erin. This is Tyler DuPont on for Jason. Thanks for taking the questions. I wanted to start by touching on the cadence of revenue growth as we look through 2024. I know you mentioned on previous calls that sequential growth would be roughly flat in 1Q. Obviously given guidance this morning, that’s not going to happen; but just given the push to the right, if you will, from a growth perspective, when should we be looking for that inflection positive, and what do you need to see from a demand standpoint for us to reach that level?
Guo Xiao: From a sequential growth perspective, we do expect that to continue to improve throughout the year. We’re not obviously calling Q2 at this moment, but we feel that with the large deals we’ve signed up and the stabilization of the pricing, and then the discretionary spending opening up in some pockets of our portfolio, that we should see steady growth coming soon. Now if–we’re still, I think, at the stage where there’s a lot of uncertainty. If the pipeline conversion slows down from where we’re seeing today or the pricing pressure continues to get worse, we’ll probably be trending towards the low end of our guidance, which means that the sequential growth will be further delayed. But if what we see in the pipeline converts as we expect, even though with some delays and then slower ramp-ups that we’ve already baked into our guidance, or if the pricing pressure alleviates that we can see some returning of consulting work, which tends to give us opportunity to do more value-based pricing, and in that case we could be trending towards the high end of the guidance, which means that the return to sequential growth will come a lot earlier.
