In July, we witnessed a significant trend of BPO companies leveraging AI to enhance processes and service quality. This raises the ongoing concern of whether AI might replace human jobs in the long run.
However, this month’s report will explore how the BPO sector is not just adapting to these changes but is flourishing. We’ll delve into the data that highlights this growth, starting with the information below:
Outsourcing Booms Despite Rise of AI
TCS
Indian IT outsourcing giants Tata Consultancy Services (TCS) and HCL Technologies are expected to see a boost in earnings driven by the rising demand for artificial intelligence (AI), despite cautious spending by US and European firms. Both companies have focused on outsourcing initiatives that emphasize cost savings, which is anticipated to lead to sequential revenue growth for TCS in the April-June quarter.
TCS is projected to announce an 8% increase in quarterly profit, marking the beginning of a recovery in the Indian IT sector. TCS has also likely added over 10,000 employees, showing the first sequential headcount growth in a year.
HCL
HCL Technologies is expected to see strong revenue growth in its IT & business and engineering & R&D services units, reaffirming its 2025 revenue growth guidance. The company also inaugurated its first global delivery center in Patna, Bihar. Located in the Udyog Bhawan Complex, this state-of-the-art facility is designed to provide advanced IT and engineering services, particularly for high-tech and semiconductor companies. The center’s launch, part of HCLTech’s New Vistas program, aims to tap into quality talent in new locations across India and strengthen the local technology ecosystem.
Wipro
Wipro reported a 5% year-over-year increase in net profit for the first quarter, reaching ₹3,036.6 crore ($364.39 million), also surpassing the previous quarter’s results by 6.2%. Despite a cautious demand environment and muted discretionary spending, Wipro slightly improved its revenue guidance for the second quarter of FY25, projecting a range of -1% to +1%.
The company has resumed fresher hiring, planning to onboard 10,000 to 12,000 new graduates this fiscal year after a year-long pause, with 3,000 already recruited in Q1. Wipro’s total workforce grew modestly by 337 employees, reaching 234,391, with a slight decline in attrition to 14.1%.
Tata Consultancy Services
Tata Consultancy Services (TCS) reported a strong financial performance for the first quarter of fiscal year 2025, exceeding analyst expectations with a 9% rise in net income to ₹120.4 billion ($1.44 billion) and a 5.4% increase in sales, reaching ₹626.1 billion ($7.2 billion). This growth reflects a resurgence in corporate spending on advanced technologies like artificial intelligence.
Despite ongoing global economic challenges and geopolitical conflicts, such as the war in Ukraine, TCS shares have risen 3.4% this year, driven by expectations of increased IT spending..
Tech Mahindra
Tech Mahindra reported a smaller-than-expected revenue decline for the first quarter, with consolidated revenue dropping by 1.2% to ₹13,005 crores ($1.55 billion). This performance surpassed analysts’ expectations, thanks to strong growth in the manufacturing and healthcare sectors, which led to increased client spending, particularly in the US.
Tech Mahindra also expanded its business processing services (BPS) in the Baltic region by opening a new center in Riga, Latvia. This move strengthens the company’s presence in Europe and offers local and regional clients advanced services such as 5G, Metaverse, blockchain, quantum computing, cybersecurity, and AI. The new Riga office, designed with an open-plan layout, training rooms, and advanced security features, will employ 500 professionals, contributing to Tech Mahindra’s global workforce of over 145,000 employees.
ACQUISITIONS
Outsourcing firms worldwide are demonstrating their commitment to providing specialized expertise and comprehensive solutions by strategically expanding their capabilities through acquisitions.
This month alone, industry leader Accenture has further solidified its position with several notable acquisitions:
Accenture’s Acquisitions for the Month of July
Openstream Holdings–Japan
Accenture has acquired Openstream Holdings and its subsidiaries, Open Stream and Neutral, to enhance its digital transformation capabilities, particularly in Japan. This acquisition will significantly strengthen their cloud, digital engineering, and manufacturing capabilities. The move will help Accenture support clients with system modernization and the adoption of technologies like cloud, AI, and IoT..
Cientra
Accenture has acquired Cientra, a custom silicon solutions provider, to strengthen its expertise in silicon design. This acquisition adds approximately 530 engineers to Accenture’s Advanced Technology Centers in India, enhancing the company’s capabilities in areas such as data centers, cloud computing, wireless technologies, edge computing, and AI-driven silicon products.
Cientra brings significant expertise in embedded IoT and application-specific integrated circuit design. This move boosts Accenture’s ability to innovate in the semiconductor space, particularly in the automotive, telecommunications, and high-tech sectors.
True North Solutions
Accenture has acquired True North Solutions, a Calgary-based industrial engineering solutions provider, to enhance its capabilities in the oil, gas, and mining industries. True North Solutions specializes in operational technology (OT), including systems that control physical equipment and facilities such as pipelines, refineries, and mines.
This acquisition adds 95 experts in automation and engineering to Accenture’s Industry X service. By integrating True North’s expertise with Accenture’s digital tools, the combined entity will help clients connect OT with enterprise IT systems, optimizing operations through real-time data analytics.
Arηs Group
Accenture has acquired Arηs (Aris) Group, a technology services provider, to bolster its support for digital transformation across Europe, particularly in the public sector. This acquisition strengthens Accenture’s position in the European market by integrating over 2,330 Arηs Group employees into its workforce. These employees bring expertise in software development, data science, AI, security management, and more, enhancing Accenture’s ability to serve clients across the continent.
Camelot Management Consultants
Accenture has announced its plan to acquire Camelot Management Consultants, a German firm known for its expertise in SAP-focused management and technology consulting, particularly in supply chain, data, and analytics. This acquisition is set to significantly enhance Accenture’s capabilities in SAP and AI-driven supply chain solutions, integrating over 700 professionals from Camelot into its team.
The move is part of Accenture’s broader strategy to help businesses develop more intelligent and resilient supply chains, especially in an environment where only a small percentage of companies extensively use AI in their supply chains.
TRAKAmerica acquires KnovaOne
TRAKAmerica, a leader in legal recovery process optimization, has acquired KnovaOne, a business process outsourcing (BPO) company specializing in legal services and accounts receivable management. This acquisition enables TRAKAmerica to expand its service offerings in legal portfolio management, legal process outsourcing, and collateral recovery management. By integrating KnovaOne’s technology, expertise, and knowledge, TRAKAmerica aims to enhance its service delivery and provide more efficient and comprehensive solutions to its clients.
AD Solutions acquires Qualpath
AD Solutions, an office technology solutions provider, has acquired Qualpath, a company known for IT outsourcing and office automation equipment. This acquisition, AD Solutions’ fourth in four years, highlights its rapid expansion in managed print and IT services across Florida. This acquisition strengthens AD Solutions’ presence in South Florida, adding Qualpath’s expertise in document management and a strong foothold in government contracts to its portfolio.
With this acquisition, AD Solutions will now offer an expanded range of products and services, including advanced office technology like Sharp copiers, Dynabook laptops, and NEC video walls.
Saphelec acquires Entela and DBH Services
Saphelec, a telecommunications and IT solutions provider, has expanded its presence in the Grand Est region of France by acquiring two Alsatian companies, Entela and DBH Services.
With these acquisitions, Saphelec aims to increase its projected turnover to €50 million ($54 million) by 2025, up from €26 million ($28 million) in 2023.
Entela, which has a turnover of €7.3 million ($7.9 million) and employs 50 people, brings over 30 years of expertise in IT and telecoms integration, including cabling, networks, cybersecurity, audiovisual, and smart buildings. DBH Services, with annual revenue of €3 million ($3.2 million), repairs around 50,000 telecom and network products each year and operates a subsidiary in Germany.
Sword Group acquires Aberdeen Appointments Agency and Industrial Automation Cyber Security
Sword Group, an IT services and consulting firm, has expanded its capabilities in artificial intelligence (AI) and cybersecurity by acquiring two Scottish companies: Aberdeen Appointments Agency (AAA) and Industrial Automation Cyber Security (IACS).
AAA, based in Aberdeen, focuses on staffing placements across various industries and is expected to see significant growth in profitability as Sword Group integrates its AI tools. Currently, AAA generates €8 million ($8.7 million) in annual revenue, with projections to increase its EBITDA margin from 2% to 12% by 2026.
IACS, which specializes in the digital security of industrial process control networks, has been part of Sword Group since July 1. The company, also based in Aberdeen, generates €2.9 million ($3.1 million) in annual revenue with a 20% EBITDA margin.
Mitie acquires ESM Power
Mitie, a leading outsourcing and energy services company, has acquired ESM Power, a high-voltage electrical engineering specialist, for up to £8.5 million ($11 million). This acquisition is part of Mitie’s strategy to strengthen its expertise in the high-voltage power connections market, which is crucial for the UK’s Net Zero goals.
ESM Power’s 60 engineers and installers will join Mitie’s Projects division, enhancing its capabilities in infrastructure, telecoms, fire and security, and decarbonization technologies.
ESM Power, with 20 years of experience and a strong client base, reported revenue of £25.5 million ($33 million) and EBITDA of £2.2 million ($2.8 million) for the 12 months ending April 30, 2024.
BELAY acquires CFO Advisory Services
BELAY, a virtual staffing solutions provider, has acquired CFO Advisory Services to enhance its fractional CFO and financial operations services. This acquisition combines BELAY’s virtual staffing expertise with CFO Advisory’s 26 years of experience in financial transformations, significantly boosting BELAY’s ability to serve a wide range of sectors, including construction, healthcare, manufacturing, and nonprofits.
Outsourcing as a Rapidly Growing Industry
The ease of global collaboration through technology is fueling rapid growth in the outsourcing industry, as evidenced by the updates below.
As the world becomes more connected, it’s set to keep expanding, bringing new opportunities for growth and fresh ideas to all sorts of businesses.
Liberia
BNS Technology Solutions, a Liberian business technology firm, has launched the country’s first international call center, marking a significant milestone for the nation’s economic development. Located in Paynesville, the call center began operations on June 7, 2024, and is equipped to handle between 60 to 100 calls simultaneously, primarily serving customers and businesses in the United States.
The center offers a range of services including customer and technical support, sales, telemarketing, order processing, and appointment scheduling. BNS aims to employ up to 120 local youths, with an initial staff of at least 60 agents, reflecting its commitment to creating job opportunities and positioning Liberia as a competitive player in the global call center market.
Egypt
Egypt’s outsourcing sector experienced significant growth in the fiscal year 2022–2023, expanding by 54.2%, according to a report reviewed by Prime Minister Mostafa Madbouly. The sector’s added value surged from $2.4 billion in the previous year to approximately $3.7 billion, while digital exports increased to $6.2 billion from $4.9 billion. The IT sector also saw substantial growth, with its added value rising by 31.5% to $5.73 billion in FY23.
This growth is supported by various initiatives, including a collaboration between the Information Technology Industry Development Agency (ITIDA) and the German Outsourcing Association, which launched the “Egypt Guide to Outsourcing Services.”
The number of outsourcing service centers in Egypt grew by 24.4% to 199, and the number of companies in the field increased by 25% to 185 during FY23.
Egypt has also signed 74 agreements to establish 85 new outsourcing centers, creating 60,000 jobs.
Africa
Africa’s business process outsourcing (BPO) industry is projected to experience significant growth, expected to double by 2030, according to a report by CCI Global and Everest Group. This growth is driven by increasing global demand for outsourced customer service solutions.
The expansion is set to create 1.5 million new BPO jobs across the continent, with South Africa, Kenya, and Egypt leading the way, while emerging hubs like Ghana, Ethiopia, and Rwanda are also poised for substantial development.
Africa’s cost advantages, including labor costs up to 80% lower than in Western markets, along with supportive government policies and a young, multilingual workforce, make it an attractive outsourcing destination.
Belize
The Belize City Council has partnered with business process outsourcing firm Peak Outsourcing International to create at least 500 jobs for Belize City residents by December. This partnership, outlined in a memorandum of understanding (MOU), includes a two-year plan focusing on job placements, internships, and career development opportunities, particularly for students and recent graduates.
The agreement also emphasizes community initiatives like youth empowerment, poverty reduction, and digital literacy, with yearly assessments to gauge the partnership’s impact.
