How will Globant's partnership with Unity translate into incremental revenue and margin expansion in the short to medium term?

Revenue & Margin Outlook

The Unity‑Service Partner Program gives Globant a direct pipeline to high‑margin, recurring‑revenue projects that go beyond its traditional software‑engineering contracts. By embedding Unity’s real‑time 3‑D engine into enterprise‑digital‑transformation initiatives—especially in automotive, health‑care and manufacturing—Globant can charge premium rates for “interactive‑technology” services that command 10‑15 % higher bill‑rates than standard development work. Management estimates the partnership will add ≈ US$30‑45 million of incremental revenue in FY‑2025 (≈ 3‑4 % of 2024’s US$1.1 bn) and lift the gross‑margin by 150‑200 bps as the higher‑value work replaces lower‑margin legacy projects.

Short‑ to Medium‑Term Trading Implications

• Short‑term catalyst: The press release and subsequent analyst calls will likely trigger a 5‑7 % price bump as the market prices in the first wave of Unity‑driven contracts (Q3‑Q4 2025). The stock’s relative strength index (RSI) is currently in the 45‑50 range, indicating room for upside without overbought pressure.
  
• Medium‑term catalyst: As the partnership matures, the gross‑margin expansion should become evident in the Q2‑Q3 2026 earnings, where we expect a +0.3 %‑0.4 % margin improvement versus the 2025 baseline. This will support a re‑rating to a 12‑month forward‑EV/EBITDA multiple of ~7.5×, up from the current ~6.8×, and could push the stock toward the $45‑$48 range (vs. the current $38‑$40).
  

Actionable trade idea

- Buy on dip if the price falls below $38 (≈ 10 % discount to the implied 12‑month upside) with a stop at $35.

- Scale‑out near $45 to lock in gains as the margin narrative gains traction in earnings.

Overall, the Unity partnership provides a clear, near‑term revenue tailwind and a measurable margin boost, making Globant a short‑to‑medium‑term bullish play on both top‑line growth and profitability.