Information Services Group, Inc.

What they do

ISG provides digital transformation and technology advisory services across sourcing advisory, cloud and data analytics, managed governance and risk, network and software advisory, technology strategy and operations design, change management, and market intelligence. It operates through two global client solution areas: ISG Digital, focused on technology, transformation, sourcing and digital solutions, and ISG Enterprise, which helps clients manage change and optimize IT, finance, HR and training operations. These are supported by ISG Research and proprietary platforms ISG GovernX, ISG Inform and ISG Tango. The firm employs approximately 1,500 professionals worldwide and was founded in 2006.

Revenue drivers

• ISG Digital — Develops technology, transformation, sourcing and digital solutions for clients; one of two global client solution areas.
• ISG Enterprise — Helps clients manage change and optimize core operations across information technology, finance, human resources and training.
• Recurring/annuity offerings — Includes ISG GovernX, ISG Research Lens, ISG Inform and multi-year public sector contracts; subscription or multi-year in nature. Recurring revenues reached a new quarterly high of $30 million in Q2 2026.
• Geographic segments — Q2 2026 revenues were $42.1 million in the Americas, $18.3 million in Europe and $5.1 million in Asia Pacific.

Recent performance

Second-quarter 2026 revenues were $65.5 million, up 6.4% from $61.6 million in the prior year, the company's highest quarterly revenue since 2023. GAAP net income was $3.3 million, or $0.07 diluted EPS, compared with $2.2 million and $0.04 a year earlier; adjusted EBITDA was $9.4 million, up 13%, at a 14.3% margin. Growth was led by Europe, up 10%, and the Americas, up 7%, while Asia Pacific declined 7%. Cash from operations was $5.2 million in the quarter, and cash totaled $23.7 million at June 30, 2026.

Strategy

ISG states it is focused on growing its existing service model, expanding geographically, developing new industry sectors, productizing market data assets, expanding managed services offerings and growing via acquisitions. The firm is positioning itself around AI-centered research, advisory and governance services. In August 2026 the Board authorized an additional $30 million for share repurchases, the largest expansion of the buyback program in company history, bringing aggregate availability to $32.3 million. It also declared a third-quarter dividend of $0.045 per share.

Risks

• Substantial debt — ISG carries long-term debt of $59.2 million as of June 30, 2026, which the company says may limit its ability to fund corporate requirements and obtain additional financing.
• Revenue unpredictability — The company states that time-and-expense engagements do not provide a high degree of predictability as to future performance, and results depend on consultant utilization, business days and headcount.
• Client concentration and discretionary spend — ISG identifies reductions in discretionary spending with top client accounts or other significant client events as a factor that could limit growth.
• Macroeconomic and geopolitical conditions — ISG cites global macro-economic conditions, tariffs, trade barriers and wars, including the conflict in Iran, as risks affecting the sourcing market and demand.

Outlook

Management targets third-quarter 2026 revenues between $63.5 million and $64.5 million and adjusted EBITDA between $8.5 million and $9.5 million, which it says will continue year-over-year growth. CEO Michael P. Connors cited the company's mix of AI-centered research, advisory and governance services along with cost optimization and business transformation services. ISG says it continuously monitors the macroeconomic environment, including FX, inflation and other factors, and will adjust business plans if needed.