Good Q3FY26 For Fractal Analytics | We Are Net Beneficiaries Of AI Progress, Says Company

Yes, this is sustainable and we expect to continue growing at this number or higher because we see tremendous acceleration with AI progress. For example, every AI system has to match and exceed human performance on that task in a consistent, reliable and a predictable way. And today, most AI systems are not accurate enough. And as AI progresses, this becomes much more addressable, which means that the number of places where AI can be applied dramatically increases. That expands the total market opportunity for Fractal. And Fractal's moat is that we can understand the ontology of the data inside companies. We know how to understand that data, what's going on in the business, what problems they are solving. This is data that models don't see. So we train models inside the company's own data and build these systems that match and exceed human performance and therefore we see a tremendous path to future growth.

One metric I'd like to propose to you is that you should imagine what happens if OpenAI releases a new model or Claude comes up with a new model. Are you excited or are you scared? So as far as Fractal is concerned, we're excited because what happens is that underlying these models are in the Cognizant platform, for example, these models are underneath. As these models get better, the ontology on top of that and our ability to reimagine every workflow with AI increases, the accuracy of these systems increases, which means that the relevance and the applicability for clients increases. Therefore, our overall growth actually exceeds. So we are a net beneficiary of AI progress. We are the disruptors and therefore we can continue growing at this pace or higher for the foreseeable future.

So in the TMT segment, we had two client-specific issues because of which our revenue declined. Otherwise, in general, for the nine months our revenue still increased, but for the three months it declined because in one client situation, the client is not doing well and they're undergoing a restructuring inside their own organization. And this is not a typical Fractal client in the sense that they don't follow the 10-20-30 rule for Fractal, which is companies that are 10 billion in revenue, 20 billion in market cap or have 30 million customers. So this doesn't follow that rule and this company obviously went through some restructuring issues. The other one is a place where they have decreased their spends. So if you not account for these two, I think overall the business continues to be good across all verticals, across all segments. Our business continues to grow really, really well. Healthcare, for example, grew by 78% year-over-year for this quarter.