- Company name
- CGI
- Sector
- IT services & consulting
- About
- CGI is a Canadian IT services and consulting company based in Montreal. It sells consulting, systems integration, managed IT and business process services, and its own software, to governments, banks, insurers, manufacturers, retailers, utilities and health care organizations. About 94,000 consultants and professionals worked for CGI at September 30, 2026. It works in North America, Europe and Asia Pacific, and the United States, the United Kingdom and Australia together give nearly half of its revenue. Many of its contracts are long-term managed services contracts, and its backlog was $32.07 billion, or 1.9 times annual revenue, at September 30, 2026. Revenue was $16.57 billion in fiscal 2026 and $4.15 billion in Q4 fiscal 2026. Its fiscal year ends on September 30, and it reports in Canadian dollars.
- Thesis
- The market prices CGI for slow growth and for the fear that AI tools will lower the amount of IT services work that clients buy. Revenue grew only 2.2% in constant currency in fiscal 2026, down from 4.6% in fiscal 2025. Investors fear that AI can do part of the coding, testing and support work that IT services firms sell by the hour or by the project. CGI also has a new CEO, Tim Hurlebaus, since May 12, 2026. CGI's results are steady: in Q4 fiscal 2026, constant currency revenue growth rose to 2.5%, adjusted diluted EPS rose 8.5% and the book-to-bill ratio was 109.2%. For managed services, the book-to-bill ratio was 122% in the quarter. For the gap to close, three things must be true. Organic revenue growth must rise from the low single digits, as the large government awards in the backlog turn into revenue. The adjusted EBIT margin must stay near 16%, which shows that AI does not force price cuts. CGI must keep buying back shares and making accretive acquisitions with its strong cash flow. The Q1 fiscal 2027 report, expected in early 2027, and the next quarters give the evidence. If growth picks up, the gap can close over the next four to six quarters. The main reason it may not close is a lasting fall in demand for traditional IT services because of AI.
- Risks
- AI tools can automate part of software development, testing and IT support. Clients can buy less work from IT services firms, or they can ask for lower prices.
Organic growth is slow. Revenue grew 2.2% in constant currency in fiscal 2026 and 2.5% in Q4 fiscal 2026. If clients delay or cut projects, growth can stay low.
Government clients give a large part of revenue and bookings. Budget cuts or changes in procurement in the United States, Canada or Europe can delay or reduce contracts.
CGI grows partly by buying other IT services firms. A poor acquisition or a failed integration can lower margins.
- Balance sheet
- Cash: CA$528M
Debt: CA$4.0B
Net debt: CA$3.4B
Undrawn credit line: CA$2.5B
Debt due within 12 months: CA$300M
CGI has low debt for its cash flow. At September 30, 2026, long-term debt and lease liabilities, including current portions, were $3.96 billion, down from $4.33 billion a year earlier. In September 2026, CGI repaid in full US$600.0 million ($834.9 million) of senior notes. On September 14, 2026, it issued $500.0 million of senior notes in Canadian dollars: $250.0 million at 4.195% due December 14, 2029 and $250.0 million at 4.484% due June 14, 2031. Cash and cash equivalents were $493.9 million, and with short-term and long-term investments the total was $528.1 million. Net debt was $3.42 billion, and the net debt to capitalization ratio was 24.7%. Long-term debt due within one year was $300.4 million, and working capital was positive at $168.4 million. CGI had $2,496.4 million available under its $2.5 billion unsecured committed revolving credit facility, which has tranches due in 2029 and 2031. Cash from operations was $2.48 billion in fiscal 2026, or 15.0% of revenue. In fiscal 2026, CGI spent $1,553.1 million on buybacks, $198.2 million on acquisitions and $144.1 million on dividends. On November 10, 2026, the board raised the quarterly dividend by 8.8% to $0.185 per share. All figures are in Canadian dollars.
As of Sep 30, 2026.
- Checkpoints
- Feb 11, 2027 (estimate): Q4 fiscal 2026 results: growth and bookings. Passed. Watch: Constant currency revenue growth above 1.3%, an adjusted EBIT margin near 16% and a book-to-bill ratio above 100% pass; falling revenue or a lower margin fails. Outcome: Constant currency revenue growth rose to 2.5%, the adjusted EBIT margin was 16.4% and the book-to-bill ratio was 109.2%.
Feb 11, 2027 (estimate): Q1 fiscal 2027: first full year under the new CEO. Pending. Watch: Organic growth that rises as government awards turn into revenue, with steady margins, passes; another quarter of growth near zero fails.
May 2027 (estimate): Q2 fiscal 2027: growth from the backlog. Pending. Watch: Constant currency revenue growth above 2.5% with an adjusted EBIT margin near 16% passes; growth below 2% or a lower margin fails.
- Recent events
- Nov 11, 2026: CGI reported Q4 fiscal 2026 results. Revenue rose 3.3% to $4.15 billion, or 2.5% in constant currency. Diluted EPS rose 30.2% to $2.24, and adjusted diluted EPS rose 8.5% to $2.31. The adjusted EBIT margin was 16.4%. Bookings were $4.53 billion, for a book-to-bill ratio of 109.2%. For fiscal 2026, revenue rose 4.2% to $16.57 billion, or 2.2% in constant currency, and the backlog was $32.07 billion. The board raised the quarterly dividend by 8.8% to $0.185 per share.
Sep 14, 2026: CGI issued $500.0 million of senior unsecured notes in Canadian dollars: $250.0 million at 4.195% due December 14, 2029 and $250.0 million at 4.484% due June 14, 2031. In September 2026, CGI also repaid in full US$600.0 million ($834.9 million) of senior notes at their scheduled maturity.
Jul 29, 2026: CGI reported Q3 fiscal 2026 results. Revenue rose 2.5% to $4.19 billion, or 1.3% in constant currency. Diluted EPS rose 22.5% to $2.23, and adjusted diluted EPS rose 9.0% to $2.29. The adjusted EBIT margin was 16.3%. Bookings were $4.20 billion, and the trailing book-to-bill ratio was 108.1%. CGI bought back 4,427,600 shares for $412.9 million.
May 12, 2026: The board appointed Tim Hurlebaus as President and CEO. He was President and COO, responsible for the operations in the United States, the United Kingdom and Australia. He succeeds François Boulanger, who is retiring after 30 years at CGI.
Apr 28, 2026: CGI increased its unsecured committed revolving credit facility to $2.5 billion, with a $1.0 billion tranche due in 2029 and a $1.5 billion tranche due in 2031.