Key insights
- CGI's Microsoft Copilot specialization is a positive but is overshadowed by recent headwinds. Declining organic growth, particularly in the U.S. federal government sector, and analyst downgrades suggest near-term challenges. The stock's undervaluation based on Fair Value assessment is a potential offset, but the overall impact on US equities is slightly negative.
MONTRÉAL - CGI (NYSE:GIB) (TSX:GIB.A) announced today it has received the Microsoft Copilot specialization in Modern Work within the Microsoft AI Cloud Partner Program.
The designation recognizes CGI’s capabilities in delivering Microsoft 365 Copilot solutions to enterprise clients, according to a press release statement. The specialization covers Microsoft 365 Copilot, including Copilot Chat, Copilot Studio and agent-based solutions.
CGI also advanced to Prioritized Tier in the Microsoft Copilot Jumpstart Program in North America. The IT and business consulting services firm employs 94,000 consultants and professionals globally.
"Scaling AI across the enterprise requires more than technology—it demands the right balance of governance, security and adoption," said Leslie McKay, CGI Chief Information Officer and Global Executive Sponsor for CGI’s relationship with Microsoft.
Jim Lee, Vice President of Americas Enterprise Partner Solutions at Microsoft, said the company is "proud to work alongside CGI to support customers on their AI journeys."
CGI reported revenue of CA$15.91 billion in fiscal 2025. The company, founded in 1976, provides IT and business consulting services, systems integration, and managed IT services.The stock has faced headwinds, declining 36% over the past year to trade at $66.58, though the company maintains a market capitalization of $13.93 billion and a P/E ratio of 11.63. According to InvestingPro analysis, CGI appears undervalued based on its Fair Value assessment, with the platform offering detailed financial health metrics and additional insights for investors.
In other recent news, CGI reported mixed second-quarter results, with organic growth declining by 2.6% year-over-year, missing targets. Analysts from Raymond James highlighted that the U.S. federal government business was a significant factor in this decline, accounting for approximately 100 basis points of the organic decrease. Additionally, RBC Capital downgraded CGI’s stock rating to Sector Perform from Outperform, citing uncertainty around AI developments as a contributing factor. In response to these challenges, CGI has taken strategic steps to bolster its offerings. The company launched a high-security sovereign AI platform in Finland, designed to comply with KATAKRI, Finland’s national security auditing criteria. CGI also announced a strategic partnership with Cleura to enhance its sovereign cloud services in the Nordic region, targeting public sector and critical infrastructure clients. Furthermore, CGI expanded its long-standing IT partnership with SSAB, focusing on delivering essential IT services in Finland and Sweden to support business continuity and operational reliability. These developments reflect CGI’s efforts to address current market challenges and expand its service offerings.
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