CGI Inc. (GIB) is trading lower today as the market digests its fiscal second-quarter 2026 earnings release. While the company posted higher year-over-year revenue and earnings, the print highlighted decelerating underlying growth and pockets of demand softness that outweighed otherwise solid profitability and cash generation.

For fiscal Q2 2026 (three months ended March 31, 2026), CGI reported revenue of $4,156.2 million, up 3.3% year over year, but only 1.6% in constant currency, with growth driven mainly by recent acquisitions. CGI reported diluted EPS of $2.09 and adjusted diluted EPS of $2.27, up 7.1% year over year. Bookings were $4.31 billion for a book-to-bill ratio of 103.8% (108.4% trailing 12 months), and backlog was $31.5 billion, with about $11.5 billion expected to convert within 12 months.

The key negative signal for the tape is demand commentary embedded in the results: CGI pointed to softer demand in U.S. Federal and parts of financial services, and the release framed growth as acquisition-led rather than broad organic acceleration. In the current tape for IT services and consulting, investors have been especially sensitive to signs of slowed client spending and weaker discretionary project activity, which can pressure near-term growth expectations even when margins remain steady.

Traders will focus on whether bookings momentum stays above 1.0x book-to-bill and whether management indicates stabilization in U.S. Federal demand and financial services project activity. Another key watch item is cash deployment: CGI repurchased 3.51 million shares for $391.9 million in Q2 and 8.09 million shares for $958.8 million over the first half, while maintaining a $0.17 quarterly dividend—supportive for EPS, but less likely to offset multiple compression if organic growth remains muted.