Teleperformance's Hybrid Workforce Pivot Takes Shape Amid Trust & Safety Decline

Sequential improvement and a deeper AI data-services push offset a shrinking content-moderation business

TEP.PA · Earnings Call · 2026-07-30

Teleperformance's Hybrid Workforce Pivot Takes Shape

Teleperformance's H1 2026 report marked a clear inflection point, even if the headline revenue remains negative. Like-for-like revenue improved from -2.2% in Q1 to -1.2% in Q2, and management used the call to reinforce its transformation playbook: hybrid human-agent workforces, AI data services, and a leaner cost base. CEO Jorge Amar captured the mood: “We are seeing the momentum that everything that the team is building and working on is getting.” — Jorge Amar, CEO · 2026-07-30

From Care to Data: The New Growth Vectors

Core Services grew 2.3% excluding Trust & Safety, and the company highlighted data annotation and data labeling as its fastest-growing vertical. Revenue-as-a-Service, sales and collection, and back-office activities are all contributing. This is not just stabilization; management pointed to increased win rates and pipeline. In Q&A, CEO Jorge Amar noted the sequential improvement in Specialized Services across LLS, CP Better Together, TLS, Health Advocate and PSG: “Yes, we are happy to report that we're seeing that sequential improvement on Specialized Services across a number of the different companies that are part of the Specialized Services” — Jorge Amar, CEO · 2026-07-30 The hybrid workforce is the core of the pitch: humans augmented by AI tools, with pricing increasingly outcome-based. When asked about the competitive threat from OpenAI's customer-service launch, CEO Jorge Amar stressed that Teleperformance brings a different edge: “We look at not only that but many of the other technologies that are out there in the market. We monitor them, we try them, we test them. We evaluate them, not only ourselves, but we do that with our clients.” — Jorge Amar, CEO · 2026-07-30

The Trust & Safety Trade-off

Trust & Safety has fallen to 6% of group revenue, hit by AI automation and offshore volume migration. Management is rethinking the vertical. As CEO said:

The easy volume will probably continue on its way of automation, but what is going to be left for human review will require the next level of scrutiny, the next level of training.
Jorge Amar, CEO · 2026-07-30

This is why restructuring costs are rising. The group now targets EUR 150-170M in run-rate savings (up from EUR 100M+), with EUR 120-140M in restructuring charges, and H1 expense already reached EUR 109M. CFO Benoit Gabelle explained the cash impact: “We have an impact of free cash flow that is linked mostly with the plan that we are implementing, but also from the end of the tail of the restructuring that were disclosed in 2025.” — Benoit Gabelle, Interim CFO · 2026-07-30

Cash Generation and a Refinanced Balance Sheet

Net free cash flow before restructuring reached roughly EUR 299M, above last year, partly due to better working capital discipline and reduced catch-up CapEx. The group also completed a EUR 1.2B dual tranche bond issuance, extending average debt maturity to 4.5 years at an average cost of 4.28%. CFO Benoit Gabelle said: “We now have an average cost of debt of 4.28%, slight increase compared to where we were at the same time last year.” — Benoit Gabelle, Interim CFO · 2026-07-30

A Break from Prior Caution

Just a quarter ago, the company warned of a 'softer performance' in Q1. In the February call, Thomas Mackenbrock had said: “we expect for the group to be below 1% and then in continued and sustained improvement throughout the year to reach the guidance range.” — Thomas Mackenbrock, Deputy CEO · 2026-02-26 The H1 results are on that trajectory. In May 2025, he had noted that LanguageLine's weakness was partly due to demand hesitation: “There is a lot of uncertainty, I would say, in the market. It’s less driven by regulatory change... but we see, in particular, for the Spanish-speaking community... hesitation to have access to public services.” — Thomas Mackenbrock, CEO · 2025-05-02 Now, management is pointing to a broader mix shift: the company's Content moderation decline is being offset by data services and hybrid workforce deals. With the strategic portfolio review still ongoing and a commitment to employee boards, Teleperformance is signaling a more deliberate reshaping of its identity than in previous quarters.