Nearshore Americas
Ibex Philippines

Ibex is Losing Steam in its Nearshore Ops

BPO firm Ibex Global saw its nearshore revenue shrinking over the past year as its clients in the US mull over an increasingly complicated macroeconomic landscape.

Ibex reported a 7.8% loss in its nearshore revenues between June of 2023 and June of 2024. Last year, the company’s revenue coming from its nearshore operations (Jamaica, Honduras and Nicaragua) reached US$155.8 million. Twelve months later, they had fallen to US$143.6 million.

In contrast, revenue from its offshore operations (Pakistan and the Philippines) increased from US$221.9 million to US$244.8 million (+10.3%) during the same period. Onshore revenue has been falling too: from US$145.4 million to US$120.1 million (-17.4%).

The company attributed the shrinkage in its nearshore revenue to concerns from US clients.  

“This reflects lower client volumes and migration for some work to lower cost regions driven primarily by macroeconomic conditions in the US that have put cost pressures on our clients,” ibex told NSAM in a written statement. 

When asked if this “migration” is happening between nearshore sites or to offshore locations, the company answered that “we’ve seen a migration of revenues from onshore to nearshore and offshore, and nearshore to offshore, as clients move from higher to lower-cost regions.”

It’s been a difficult couple years for the outsourcing industry. The macro landscape has yet to brighten in the ways they hoped for, forcing clients to evaluate their partnership options. This has resulted in fewer and/or smaller projects, or outright loss of contracts, which has led in several instances to layoffs or shutdowns. Last month, it was reported that itel CX, a competitor of Ibex in the nearshore, will close its delivery center in Guyana before the end of the year. The closure –caused by rising costs and pickier clients, according to reports– will affect 400 employees of itel in the country.

Ibex assured investors that it has been doing well enough in verticals such as retail, e-commerce, travel and health-tech. However, there have been struggles with telecommunications and fintech clients. 

Ibex told NSAM that the telecoms sector has been “in steady decline over many years” due to subscriber churn and other troublesome factors unique to that market. The company waved off its decline in fintech as a “one-off” issue, driven by the fall of crypto and “a chance in support policy with a key financial client.”

“We expect growth to come back to that segment in the near term,” the company stated.

 

Changes in Jamaica

Ibex has been doing some major restructuring work in Jamaica, one of its main nearshore locations.

The company closed two of its Jamaican sites between June 2022 and June of 2024, cutting down the overall number from six to four. That leaves its nearshore sites at nine: four in Jamaica, four in Nicaragua and one in Honduras. Ibex has 29 delivery sites in total spread across the US (three) the Philippines (eight), Pakistan (nine) and the aforementioned nearshore countries. 

The two sites which were closed down over that couple years were Waterfront and Portmore Pines. Waterfront was part of Digicel Caribbean’s HQ, Ibex explained, so they had to move to accommodate Digicel’s own expansion plans. Portmore Pines was closed down due to the lease expiring and “multiple recurring issues”, such as bad plumbing and power outages. 

Ibex claims that all personnel were relocated to new, consolidated sites with fewer workstations. Ibex’s workstations in the Nearshore fell from 5,477 in June of 2022 to 3,878 as of June of 2024. 

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“We improved utilization of the available workstations,” the company explained. “As a result, utilization is up, on lower total workstations, with no agents losing their jobs.” 

Ibex currently operates four sites in Jamaica: two in Portmore (Campus 1 and Campus 2), one in Kingston (Grand) and another in Ocho Ríos. It is currently seeking to onboard 1,300 agents in the country.

Narayan Ammachchi

News Editor for Nearshore Americas, Narayan Ammachchi is a career journalist with a decade of experience in politics and international business. He works out of his base in the Indian Silicon City of Bangalore.

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