Stonegate Capital Partners Updates Coverage on Information Services Group, Inc. (III) 2Q26
Dallas, Texas--(Newsfile Corp. - August 10, 2026) - Information Services Group, Inc. (NASDAQ: III): Stonegate Capital Partners Updates Coverage on Information Services Group, Inc. (NASDAQ: III). III's 2Q26 results improved the forward setup as revenue and adj. EBITDA exceeded guidance, AI-related revenue accelerated, and recurring revenue reached a record. The differentiated read-through is that AI is strengthening both sides of ISG's earnings model, generating demand across governance, sourcing, research, and advisory while supporting delivery efficiency, higher-value mix, and margin expansion. Underlying growth remained mid-single digits excluding FX and Martino, with growth broadening across the Americas and Europe despite measured enterprise decision-making. Record recurring revenue expands visibility beneath ISG's project-oriented advisory work. Management said the pipeline is probably as strong as it has ever been, although client decision timing remains the primary visibility constraint. We are keeping an eye on AI governance expansion, larger opportunity conversion, recurring-revenue mix, and APAC's return to growth.
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Key Takeaways:
Revenue increased 6.4% y/y to $65.5M and adj. EBITDA increased 13% to $9.4M, both above guidance, while adj. EBITDA margin expanded 80 bps to 14.3%. The quarter reinforces the view that III is converting improving demand, pricing, higher-value advisory mix, and AI-enabled delivery efficiencies into better operating leverage.
AI-related revenue increased 64% y/y to $26M, with nearly half of clients now generating AI-related revenue, while recurring revenue increased 7% y/y to a record $30M. We believe the combination is important to the forward setup, as AI governance is creating incremental demand across existing client relationships while recurring revenue adds greater visibility to III's traditionally project-oriented model.
Growth broadened across the Americas and Europe, while management described the pipeline as potentially the strongest it has ever been and guided to continued y/y growth and margin expansion in 3Q26. Although enterprise decision timing remains a near-term constraint, the strength of the pipeline and improving regional trends support a constructive 2H26 outlook.
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About Stonegate
Stonegate Capital Partners is a leading capital markets advisory firm providing investor relations, equity research, and institutional investor outreach services for public companies. Our affiliate, Stonegate Capital Markets (member FINRA) provides a full spectrum of investment banking, equity research and capital raising for public and private companies.
Contacts:
Stonegate Capital Partners
(214) 987-4121
[email protected]
Source: Stonegate, Inc.
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