Good day, and welcome to the Globant Third Quarter 2020 Earnings Conference Call. All participants will be in listen only mode. After today's presentation, there will be an opportunity to ask questions. Please note this event is being recorded. I would now like to turn the conference over to Paula Convey, Investor Relations Officer.
Please go ahead.
Thank you, operator, and thanks, everyone, for joining us today on our call to review our Q3 2020 financial results. By now, you should have received a copy of the earnings release. If you have not, a copy is available on our website, investors. Globant.com. Our speakers today are Martin Migoya, Co Founder and Chief Executive Officer Juan Urtiague, Chief Financial Officer and Patricia Pomis, Chief Delivery and People Officer.
Before we begin, I would like to remind you that some of the comments on our call today may be deemed forward looking statements. This includes our business and financial outlook and the answers to some of your questions. Such statements are subject to the risks and uncertainties as described in the company's earnings release and other filings with the SEC. Please note that we follow IFRS accounting rules in our financial statements. During our call today, we will report non IFRS or adjusted measures, which is how we track performance internally and the easiest way to compare Globant to our peers in the industry.
You will find a reconciliation of IFRS and non IFRS measures at the end of the press release we published on our Investor Relations website announcing this quarter's results. I'd like now to turn the call over to Martin Migoya, our CEO.
Thanks, Paula, and hello, everyone. I'm happy to be with you again as we continue on our journey to reinvent this industry. In Q3, Globant brought in $207,200,000 in revenue, delivering a 20.9% year over year growth. I'm happy to see how our Globers continue to demonstrate their amazing talent and resilience in the face of uncertainty. This year for us meant to push our vision to reinvent the industry even further.
IDC predicts that there will be over $6,800,000,000,000 of direct digital transformation investment between now 2023. Despite uncertainties, we have a unique opportunity and we will keep working to make companies agile and accelerated. Our positioning remains at the forefront of the market as a pure play in the digital and cognitive transformation space. Recognizing these, IDC Marketscape named Globant as a global leader in its worldwide customer experience improvement services 2020 vendor assessment. We're very honored because this shows our commitment to creating products and customer experiences that connect with millions of consumers in a different way.
Many special thanks to our clients like DIRECTV, LATAM Airlines, Rockwell Automation and Prisma, who shared their experience with IDC and made this recognition possible. Now I'd like to turn the call over to Patricia Pomies, our Chief Delivery and People Officer, to share with you some of our new initiatives. Pato, please?
Thanks, Martin. Hello, everyone. It's nice to be with you all again. As I have shared with you before, at Globant, we have more than a vision of changing the world through technology. We want to change the technology sector itself.
At a time when all of us are reinventing ourselves, reevaluating our opportunities and reminding ourselves of what is truly important in life, Globant is taking those steps forward as a company. Our Be Kind initiative is taking on a new project this fall. We are presenting the Globant Awards, Women That Built Edition, to recognize women who have shown tremendous leadership in technology and who are the future of the sector. We will be recognizing these women across the 16 markets where we work. With this initiative, we aim to build a community of support, awareness and dedication for greater female participation in the tech sector and to close the gender gap.
This is meant to create a virtuous circle of ideas, innovation and growth. Leaders from the business, academic and civil society fields will be in our panel of judges: Shai Losberg of MIT as well as Linda Rotenberg from Endeavor and the Edge from U2 will make our global recognition. I invite you all to discover more at womenawards.globend.com. Now I'd also like to take this opportunity to mention our ongoing investment in our talent. Our digital education platform, Global University, continues to be used by our Globers to upskill and reskill in the most sought after capabilities of the sector.
Since our launch last quarter, I'm so happy to see that so many of our Globers have taken advantage of this opportunity. As the digital trend continues, this is our company's moment to take a global step. Globant has never been a more exciting place to work, where professionals have the opportunity to join teams from all over the world and create exciting solutions for some of the most innovative brands in the planet. Realizing the uniqueness of this opportunity, combined with our constant search for the best talent, we are looking to hire talent from the world to execute our ambitious growth initiatives. We are collaborating with many prestigious businesses calls to offer graduates a worldwide, hands on and multisector experience.
I look forward to sharing with you more of these initiatives in the near future. Thank you. Martin, please?
Thanks, Pato. As you may remember, our BKIN initiative was first presented on this call 1 year ago. It was based on 3 pillars: Be Kind to our peers, to humanity and our planet. For us, this vision is how we want to positively impact the state of our world. In addition to diversity and inclusion programs, we continue to dedicate ourselves to the planet.
We will meet our objective of relying on 100% renewable energy this year. But today, I also want to share with you that we are committing ourselves towards a new and more ambitious goal. We will become full carbon neutral by the end of 2021. We make this commitment because we know that as global citizens, we must set an example of sustainability over the long term. Aligned to this, as we evolve our organization, we also believe that we have a commitment to helping our clients reinvent themselves.
For a long time, the concept of sustainability has focused mostly on environmental issues, but we believe that the sustainable development of the world should take into consideration a holistic approach where people, profit and planet are interconnected. This calls for a new approach. I'm glad to share that we have just launched our new sustainable businesses studio. This studio will operate as intersection between digital technology and sustainability, bringing together new know how and capabilities. We want to provide organizations and stakeholders with the tools and expertise to support climate actions and perform as responsible businesses.
It is an exciting era, and I expect to share more news soon. For more information about this new studio, feel free to visit sustainablebusiness. Globan.com. Now, I'd like to go over what we have been working on. We believe the future of all companies lies heavily on their ability to embrace artificial intelligence.
I have talked to you in the past about augmented globant, especially augmented coding, our solution to allow coders to work quicker and with greater collaboration and creativity. In September, during CONVERGE, we officially presented augmented coding with Steve Wozniak as our special guest. Adapting to the current reality, this was the 1st online version of converge, which enabled us to expand the typical attendance to over 9,000 people watching live. Now regarding our clients. As I mentioned on our last earnings call, the pandemic has accelerated the shift to digital for many of our clients across several industries.
This trend is accelerating in Q3 with the engagements we deliver. We have brought in 40 new logos in the past quarter across many different industries. Let me double click on a few. We have continued to work with Pfening International throughout the COVID crisis. Globant created a COVID-nineteen partnership program for Feanin to support several projects throughout 2020.
We have also just started multiple long term engagements with Depop, a mobile fashion marketplace. We're working on their mobile development and quality assurance services. In gaming, we're providing co development services for 2 of Warner Bros. Games, Hogwarts Legacy and Gotham Knights. In the retail space, we won a strategic mobile development project with the Gap in early Q3.
Our project is directly aligned to increase the company's revenue from its online channel, a critical adoption to the new normal. In the financial sector, Globant continues to capitalize on the shift to digital finance. One such project at SoFi, where we are providing the technology support for the integration process of 1 of their acquired companies. We also continue to broaden our relationship with OpenBank, Spain's 1st and largest digital bank. As a strategic partner, we are involved in the international rollout of their multi country platform with more than 27 projects in 9 countries.
We are working at every layer and with a broad technology stack. This will help OpenBank to scale up their banking platform that will drive future expansion. In the food and beverage sector, we are working with Grupo Riquelme, a holding that produces, distributes and sells in Paraguay. It has a strong supermarket chain and is innovating an e commerce platform. We are partnering with them so they can offer an integrated value proposition and develop a data driven work culture with the capabilities necessary for an industry in disruption.
Closing out, I'm happy to say that our global family keeps on growing. In personal, we have ended the quarter with 14,340 Globers worldwide. During Q3, we broke records in recruiting, while attrition remained low at 12.6% for the last 12 months. 2020 made something very clear. Organizations everywhere need to truly harness the power of AI and have the agility necessary to build and leverage their unique capabilities.
This will be Globant's positioning as we move forward, as we continue to craft the right solution for our clients. With that, I'll turn it over to Juan to go further into the financials. Thank you very much. Juan, please?
Thanks, Martin, and good afternoon, everyone. I hope you are all doing well and staying safe. Let me start by summarizing our Q3 2020 results. I will then discuss our guidance for
the Q4.
We are very pleased with our overall results for the Q3 of this year as we displayed strong execution in these challenging times. Our revenues for Q3 amounted to $207,200,000 beating our guidance and representing a solid 20.9% year over year growth. On a sequential basis, our revenues for Q3 increased 13.4%, showing a very healthy recovery. Q3 revenue growth was 21.9% year over year in constant currency. In line with our expectation, the overall demand environment largely stabilized in the latter half of the second quarter, and we have witnessed an improvement in end market in the last several months, which is reflected in our strong sequential organic top line improvement in the Q3.
We remain bullish about the demand environment post the COVID-nineteen crisis and are encouraged by the ongoing positive trend in our bookings. That said, we also remain cautious about any impact to our end market due to the potentially new waves of lockdowns, like the ones we're currently witnessing in Europe and in some parts of the U. S. As discussed in our last earnings call, we always prioritized the health and safety of our employees and almost all of our employees continue to work from home, while maintaining seamless delivery of services to our customers. Our delivery and people teams continue to develop and execute strong and innovative initiatives to keep employee productivity and morale high.
Disney was once again our largest customer for the quarter, growing a strong 10.2% year over year and 14.8% quarter over quarter. We continue to be very well diversified within Disney, serving the majority of its subsidiaries. Other than Disney, rest of our accounts collectively grew at a solid 22.4% year over year with revenues from the top 5 and top 10 accounts increasing at a robust rate of 49.3 percent and 41.1 percent respectively over the Q3 of 2019. Consistent with Q2, our top accounts are proving to be more resilient to COVID-nineteen impact relative to the rest. As mentioned before, we experienced sequential improvement in Disney with revenues growing 14.8% quarter over quarter.
Outside of Disney, rest of the accounts collectively also grew strongly at 13.2% quarter over quarter as we experienced improvements in most industry verticals. Our customer concentration numbers for Q3 2020 remained similar to Q2 2020. Our top 1, top 5 and top 10 accounts representing 10.8%, 32.2% and 45% of revenues compared to 11.9%, 26.1% and 38.6% of revenues respectively for the Q3 of 2019. Looking at diversification of our revenues by industry verticals, we remain balanced across the different industries with financial services and media and entertainment leading the pack accounting for 23% and 22.8% of our revenues respectively. Professional Services and Financial Services were the fastest growing industry verticals in Q3, growing at 39.1% and 30.6% year over year respectively.
Starting this quarter, we are disclosing our exposure to the healthcare vertical. Healthcare represented 8.8 of our revenues in the 3rd quarter and we believe has a massive growth potential for us. Regarding the progress of our 100 Square strategy, during the last 12 months ended September 30, 2020, we had 16 accounts above $10,000,000 in annual revenues compared to 13 customers for the same period last year and we have 118 customers with more than $1,000,000 of annual revenues compared to 104,000,000 1 year ago. We continue to expand our relationships with our key accounts, the base for our continuous growth. In terms of geographic regions, during the Q3 of 2020, 70% of our revenues were in North America, 22.4% in Latin America and others and 7.6% were in Europe.
In Europe, we witnessed a strong acceleration in revenues growing at 56.1% year over year and at 34.4% on a sequential basis. Also Latin America and others showed continued strength growing at 58.7% year over year and 22.1% sequentially. During the Q3 of 2020, 84.5 percent of our revenues were denominated in U. S. Dollars, providing a hedge to our top line against currency fluctuations.
Turning now to profitability. Our adjusted gross profit for the period increased to $80,800,000 representing 39% adjusted gross margin, compared to $69,600,000 representing 40.6 percent adjusted gross margin in the Q3 of 2019. Year over year adjusted gross margin decline is mainly explained by COVID-nineteen related lower utilization. However, on a sequential basis, adjusted gross margin improved 80 basis points, helped by the sequential improvement in utilization, partially offset by salary increases and FX fluctuations. We finished the quarter with 14,340 Globers, 13,436 of which were technology, design and innovation professionals.
In the 2nd quarter, we have decided to focus on only selective hiring of IT professionals in response to the impact on the demand environment from COVID-nineteen crisis. However, since the latter half of Q2 and continuing into Q3, we have been witnesses gradual improvement in the demand environment. In response to this, we strongly restarted our hiring engine in Q3 and had a robust addition of 1863 IT Professionals sequentially. Organic sequential net additions of IT Professionals excluding GA's acquisition stood at 7.17, representing a solid return to pre pandemic levels of employee additions. Over the last few years, Globant has invested heavily in establishing a robust training and hiring infrastructure across the globe, which gives us a strong ability to seamlessly ramp up hiring and training as required.
At this moment, we do not foresee any challenges in finding the right talent to meet the demand. Attrition for the last 12 months continued to decrease and was at 12.6% compared to 14.1% 1 year ago. Normalizing from the impact of the recent CA acquisition, attrition would have been 13.4%, still very healthy. We continue to expect attrition in the 14% to 16% level once we come into a post COVID-nineteen world. Adjusted SG and A came at 20% of our quarterly revenues, a decrease of 70 basis points compared to Q2 2020, but an increase of 60 basis points year over year.
We continued investing for the future primarily to expand our sales coverage in our target markets, mainly in Europe. We believe this focus will better prepare us to capture the robust demand expected post the COVID-nineteen crisis and help maintain a strong long term revenue growth profile. As a result, our adjusted operating income for the quarter amounted to $31,600,000 or 15.3 percent of revenues compared to $30,900,000 or 18.1 percent of revenues for the Q3 of 2019. On a sequential basis, adjusted operating margins improved 180 basis points as our revenue growth profile and utilizations continue to trend towards the pre COVID-nineteen levels, it will have a positive impact on our adjusted operating margins. However, we will continue to strongly invest in the company as well.
Together, this leads us to believe that adjusted operating margin will trend in the 15% to 17% range in the near and midterm. Share based compensation expense for the Q3 of 2020 amounted to $6,600,000 representing 3.2% total revenues for the period. This expense is mainly related to the planned of restricted stock units granted to certain key employees and directors of the company as part of our long term retention plan. Finance expenses amounted to $2,300,000 in the Q3 of 2020 compared to $1,800,000 for the same period last year. This loss is mainly composed of interest expense on lease liabilities and interest expense on borrowings.
Other financial results net amounted to a loss of $1,500,000 for the quarter compared to a loss of $2,100,000 during the Q3 of 2019. This item is primarily composed of FX results from monetary assets and liabilities in local currencies, results from our hedging strategies and gains from transaction with bonds. In the Q3, we recorded a loss of $3,700,000 in other income and expenses net. This is related to remeasurement of the fair value of contingent consideration associated with one of our acquisitions in 2019. Our IFRS effective tax rate for the quarter was 23.4%, coming in line with our expectations of 22% to 24%.
We expect our Q4 2020 effective tax rate to be between 23% to 25%. Adjusted net income for the Q3 of the year totaled $24,400,000 representing 11.8% adjusted net income margin, compared to $23,500,000 representing 13.7% adjusted net income margin for the Q3 of 2019. On a sequential basis, adjusted net income margin increased by 90 basis points. Adjusted diluted EPS for this quarter was $0.60 based on 40,800,000 average diluted shares for the quarter, compared to $0.62 for the Q3 of 2019 based on 37,800,000 average diluted shares for the quarter. Moving on to the balance sheet, our cash and investments as of September 30, 2020, amounted to $395,600,000 while borrowings amounted to $78,600,000 During the Q3, we generated strong free cash flow of $21,600,000 Q3 was another solid quarter for free cash flow despite the ongoing COVID environment and our free cash flow to adjusted net income was around 90%.
We also continue to execute on our M and A strategy with the latest acquisition of CA on July 31. CA is performing as expected and the integration is proceeding very smoothly. Now let's talk about the 9 months ended September 30, 2020. Revenue for the 9 months ended September 30, 2020 was $581,500,000 implying a solid 22.4% year over year growth. Revenues started on a strong footing in the Q1, followed by a period of softness in the Q2 resulting from COVID and then showcasing strong sequential strength in the Q3.
Adjusted gross profit for the 9 month period was $226,200,000 or 38.9 percent adjusted gross margin compared to $193,000,000 or 40.6 percent adjusted gross margin for the same period last year, a decrease of 170 basis points. On a year to date basis, this margin compression was mainly explained by lower revenues to the impact from COVID-nineteen and lower utilization. As previously discussed, despite the impact to our top line from the ongoing pandemic, we have decided to not let go of our employees with the assumption that COVID-nineteen crisis is short term in nature. Adjusted SG and A for the 9 month period accounted for 20.3% of revenues, increasing 60 basis points compared to the same period last year. Adjusted profit from operations for the 9 month period ended September 30, 2020 was $86,100,000 or 14.8 percent adjusted profit from operations margin compared to $81,600,000 or 17.2 percent adjusted profit from operations margin for the same period last year, representing a decrease of 2 40 basis points and driven primarily by the impact of COVID and FX on gross margins.
Adjusted net income for the 9 month period ended September 30, 2020 was $68,800,000 or 11.8 percent adjusted net income margin, compared to $61,900,000 or 13% adjusted net income margin for the same period last year. Adjusted diluted EPS for the 9 month period ended September 30, 2020 was $1.75 based on 39,300,000 average diluted shares for the period compared to $1.65 for the same period last year based on 37,600,000 average diluted shares. To wrap up, I would like to share with you our outlook for Q4. Based on current visibility, we expect Q4 2020 revenues to be at least $220,000,000 or 19.4% year over year growth. At this point, we do not expect any FX impact to our 4th quarter revenues.
Q4 adjusted operating margin is expected to be largely in line with Q3 2020 And adjusted diluted EPS is expected to be at least $0.66 assuming 41,300,000 average diluted shares outstanding for the quarter. Also, we expect our tax rate to be in the 23% to 25% range in Q4 2020. Thanks everyone for participating in the call for your coverage and support. Operator, can you please queue questions? Thank you.
The first question today comes from Tien Tsin Huang of JPMorgan. Please go ahead.
Thank you so much for good results here. I wanted to ask with the improvement that you saw from the Q2, including from your larger strategic clients, Martina, is it safe to say that your visibility is back to pre COVID levels, especially amongst your larger clients? I know we can't really say we're beyond the pandemic yet, but are you at a point now where you feel like the visibility is back pre COVID levels?
Hi, Binjian. Thank you so much for coming today. In general terms, I would say, yes. There are some caveats that are happening on the ramp up of gifts of some of those customers that ramp down. And but I feel that it's by far compensated by activity on other places and even other areas of that of those same customers that are growing very, very fast.
So visibility is good. Pipeline remains at very healthy levels and increasing from previous levels. So I'm optimistic in general that the situation is good, although COVID, you never know what's going to happen. So I would never be 100% sure about the visibility, but it's much better than last quarter.
Yes. No, it sounds that way. And it sounds like you also my follow-up question that you're hiring organically back to sort of pre COVID hiring. It sounds while you're talking about no issues or challenges from a hiring standpoint. So I'm just thinking if this demand trend continues, do you feel confident that you have the resources to deliver if we want to get back to sort of your pre COVID revenue growth in 2021 for instance?
Do you have the resources and the delivery to do it?
Yes. Look, we took a very serious decision when the crisis started around which would be our what we would do with the bench and the lower utilization that we were having. And we took I think now looking at it from further, we took a wise decision given that we choose to preserve the people and to have the people ready whenever the business comes back. The other decision could have been to preserve margins and to preserve the utilization and to not be ready whenever the business come back. And I think we were the winners in this position because we choose to preserve the people, preserve the talent, keep on hiring.
We slowed down, of course, during the crisis, But now we are back full steam ahead, 763 organic new people in the quarter, plus another amazing 1100 people from the GA acquisition. So I feel very confident that we can complete and we can fulfill the needs of the talent that we need looking forward and into next year.
Very good. Thank you. Nice job.
Thank you.
The next question comes from Bryan Bergin of Cowen. Please go ahead.
Hi, good evening. Thank you. I wanted to follow-up on that last question. Can you talk about where you're focused on adding headcount? Any regions or you have a greater emphasis in any regions that you haven't historically been adding in?
Yes. Hello, Brian. This is Juan. At Soluis, Latin America is still our largest talent development center. We are seeing a lot of growth in Colombia, Mexico, also in Argentina at this point.
On top of that, our India operation, which is extremely healthy and growing, is another area where we are going fast. And of course, we still need to do more work to accelerate in Eastern Europe, but we are doing good progress. So you should expect Latin America and India to lift the growth. And then a little bit later, Eastern Europe, which is another area where we are putting some investment.
Okay. And then just as it relates for the 4Q revenue guide, is there anything to call out on organic trajectory assumed in that 4Q outlook outside of just a more difficult comp from 4Q 2019 relative to 3Q? I'm hearing obviously the momentum and the positive comments on visibility. Just curious if there what you might be baking into that 4Q growth rate, anything to call out?
Yes. Look, I mean, Q4 is another sequential organic growth. We continue to see, as Martin was mentioning before, very good hirings and utilization improving during Q3, a little bit more during Q4. So in the guidance for Q4, which is almost 20%, the inorganic part that comes from GA is pretty much what we mentioned in the last call. Even though the teams are already integrated and we are we started cross selling into the 3 companies and the customers of the 2 companies.
At this point, we can say that GA is about $16,000,000 in Q4. But again, this is probably going to be the last time we will be able to split that revenue clearly as the teams are already integrated into global regions.
Okay. Were they what you thought they would be from a revenue contribution for this quarter?
Yes. They are in line with what we mentioned in the last call, a little bit close to $11,000,000 Okay,
great.
Thanks guys.
The next question comes from Ashwin Shirvaikar of Citi. Please go ahead.
Hi, thanks. Hope you guys are well. So my first question was to ask if you're seeing very strong sequential growth here. Some of that's partly because of the beaten down base that we're kind of going through. Do you expect that to persist the next couple of quarters heading looking into next year?
So not looking for guidance obviously, but it is pretty good solid sequential growth.
Hello, Ashwin. Thank you for the question. So at this point, as Martin was saying, we are optimistic about the future. The visibility is improving. We are seeing good momentum in our top accounts, even in those that do have some COVID impact, but we are starting to see some comeback on some business units within those customers.
And again, at this point, we expect, provided that the COVID situation does not deteriorate or does not come back a good 2021. I mean, everything seems to be moving into the right direction in terms of pipeline, in terms of visibility. But I think we still need to wait a little bit until the vaccine or new treatments out there and remove all the uncertainty that is still around. But all in all, I think we're optimistic about 2021.
Okay. So in other words, as you speak with your clients and talk to them about their budgets for next year, that can get a bit delayed here and there, of course, the budget itself in a when times are tougher. But you're seeing for the type of work you do, that demand should continue to be strong, correct?
Yes. Look, Ashwin, thank you. My approach to that is that I believe that the thing is totally across the board. I mean, yes, I can talk with my customers, but I can also talk with other new customers and potential customers and pretty much all of them are thinking about increasing that spending or do the transformation faster. So I mean, I think to answer your question, rather than just talking about the customers, I would talk about the general environment of the demand in the industry, which I feel is strong.
So this is my so this is what we are seeing for next year, too. I mean, this is just the beginning. And I'm we are optimistic because of that reason. And on top of that, then some of the customers are we're seeing a positive trend in terms of what how fast they want to do the transformations.
Understood. Thank you.
Thank you, Ashwin.
The next question comes from Maggie Nolan of William Blair. Please go ahead.
Thank you. When you think about all of the changes in the last couple of quarters in this year, have there been any changes in that top 10 customer group? And can you give us an idea of the makeup of that group in terms of vertical exposure, length of relationships with those customers and other similar details, how it may have changed over the last couple of quarters?
Yes. Hello, Maggie. So yes, on the top accounts, as you would expect, some of the travel companies are out of the top 10. They were impacted heavily by Covid. And those accounts were replaced by some manufacturing companies, by some professional services companies and some financial institutions.
So I think that we're actually in a situation where this year we lost a lot of revenue from the travel and hospitality industry. If you look at that number last year, it was €92,000,000 If you look at the number and you do kind of a run rate, we are going to end up somewhere in this $65,000,000 to $68,000,000 range. So even in a scenario where we basically lost more than €20,000,000 in travel, we are still achieving a very, very healthy growth. And hopefully, at some point in the future, those accounts start to come back. I mean, we are in very good relationship with all those accounts.
And we feel that once all this COVID situation is over and they are able to come back to investment mode, we will be in a very good situation. So those are the main changes in the top accounts, Maggie. I would say less travel and a little bit more of all the other industries. Healthcare is also another industry that as an industry, you will continue to see growing, not still in the top 10, but you will still see some of those customers showing up in the top accounts over time.
Okay. And then can you talk
about the pace of project ramp ups and how that's changed since last quarter?
Yes. So I would say that when you look at Q2, Q2 basically was initially things started to slow down, then they stabilized. And towards the end of the quarter, you started to see recovery, right? And the recovery accelerated all throughout Q3. Every month was a little bit better than the previous one.
We restarted all the hiring engines, and we ended up with a very solid hiring number, very, very solid. And I think that, again, the needs from the customers, customers have more visibility now, so they are more comfortable restarting or accelerating some of the projects on digital transformation that they had in the pipeline. And I think that we got some of that benefit and the fact that we kept basically pretty much everyone in the company and we kept on hiring selectively and we accelerated very early in the quarter, help us to take part of that growth very quickly.
The next question comes from Diego Aragao of Goldman Sachs. Please go ahead.
Yes. Thank you for taking my question. Actually, my question is more like a follow-up with the views and the outlook for Genentone. I mean, just would like to understand what are the factors that should drive most of your growth? And maybe if you can also comment about like the factors that you are most what they're concerned about at this point, that would be helpful.
Thank you.
Sorry, Diego. Would you be able to repeat the question? There was some noise on the line and we couldn't get it.
Yes, sure. So I just want to hear your views about the factors that should drive most of your growth in 2021? And also, what are the sectors that you are more concerned about at this point in terms of potential projects, generally being delayed. It will be helpful if you can comment about the views for the main factors you have been providing service? Thank you.
Yes, Diego, now we got it. Thank you. This is Martin. In health care, financial sector, payments, retail online retail, Those segments grew quite fast. And I feel that they will keep on growing there.
And then the catch up will come back from those that were not enjoying the COVID-nineteen crisis on the sectors that were a little bit more complicated with their business. And the drug for us during these months has been basically entertainment entertainment, not the online entertainment, but the another strong sector for us was gaming and game creation and game operations. And the guys that went a little bit slower on in person entertainment and, of course, the whole travel segment from airlines to cruise lines and hospitality and hotels. That part was the drag and the accelerators were the others that I mentioned. Hope that answers your question.
Okay. That's helpful. Thank you.
Thank you so much.
The next question comes from Arvind Ramani of Piper Sandler. Please go ahead.
Hi. Thanks for taking my question. You've talked a lot about the acceleration of digital work over the next couple of years. Can you talk a little bit more about how you're preparing to take advantage of this demand? I would think from a sales, operations, delivery perspective, there's a lot to be done.
And also if you can give us some color on sort of differences between how you're approaching it from your existing clients versus prospecting new clients?
Hello, Arvind. Thank you for the question. Yes, I mean, we are doing many, many things. On the hiring front, we continue expanding our recruiting teams, our staffing teams in the regions where we are. As you know, we have taken the decision to have presence in Latin America, in India and Eastern Europe.
And I think that's going to be a positive in the future because we are present in these three largest talent pools out there, right? So on that front, we're doing a lot of things. If you look at the attrition number that has continued to come down, we have done a lot of work to have our people engaged with the company to keep all the more senior people in the company, all the knowledge that they have gained over the last several years in the company. And I think the training that we are putting for these guys, all the different skills that they are gaining are going to be very, very important. And those are some of the things that we are doing just to make sure that we from a delivery point of view, we have the talent available that we need.
We've been hiring quite a lot in advance, as you can see, in our numbers. I mean, we haven't really stopped hiring except from a little bit in Q2, and that's part of getting ready. And then on top of that, as you know, we've been investing quite a lot in our internal strategic initiatives like augmented coding. And those are things that augmented recruiting, augmented staffing, augmented knowledge, multiple internal strategic initiatives that we believe are going to help us change the industry, are going to help us be ready when all these opportunities that are happening are in front of us, right? So I think that those investments plus all the investments in bringing people on to the company and retaining people and training people are the right decisions to take advantage of this opportunity that is in front of us.
Terrific. And I also wanted to ask on Disney to the extent that you're able to share, certainly, Disney has been really strong. And you've talked previously about your kind of work with Disney plus Can you let us know like kind of the breadth of work that's being done at Disney? I mean, for example, is Parks still like a kind of good account or sort of should we expect kind of pent up demand in parks as we look into 2021?
This is a success story for us. As you know, we have been growing a lot over the last several years. In the last quarter, we said that we were expecting recovery in Q3, and we got that recovery. Once again, we're expecting sequential growth for this quarter at Disney. And hopefully, they are able to reopen all their packs.
And if the vaccine is readily available, I'm sure that's going to be a very positive factor for business. But if that doesn't happen, we are still we have been able to expand our services into multiple areas within that account. And that is the reason why we were able to recover our business, to keep growing our business even in the middle of the pandemic. So we feel optimistic about this new. It's a great account.
It's more than 11 years already working with them. And we have expanded our offering into multiple areas in that customer.
The next question comes from Steve Enders of KeyBanc. Please go ahead.
Hi, great. Thanks for taking the question.
I just wanted
to follow-up on what you are hearing from your clients when it comes to demand outlook. I know the discussion around the vaccine is still fairly recent, but is there an opportunity that unlock even further budget within your customers as we move into 2021?
Yes. The demand outlook is interesting. I mean, what's going on in different industries is really something that we are seeing as a very positive trend. And again, when you talk about certain spaces where the transformation were slowed down, for example, EdTech and everything that is happening on education and you are seeing now that every single career in the planet is being taken offline online, sorry, and is being and even the exams are happening online. That's a huge transformation that was about to happen, but never happened.
And now suddenly you have 100% of the population of the world pretty much starting from home. Well, that will require and this is just an example and I think it's a very illustrative example because that will require like a whole new set of technologies that needs to happen and need to get ready for this massive amount of things that maybe 20%, 30% of those things will come back to classes to physical connection. But 7% will remain or something like that will remain online. And that's a massive jump in terms of the technology that is needed. So I'm taking this example because I think it's one of the most visible examples, but in the same way in many other industries, the same thing is happening.
So when we talk about this acceleration in the demand, we're talking about this kind of mega changes that are happening. Not all of them will not everything will change, but many industries will have a deep and profound impact after this new after this, I would say, rediscovery of how to do things. So I'm very positive because of that, because of those kind of examples I'm mentioning. That's my outlook on what's going to happen in the coming months, quarters and maybe years.
Okay, great. That's really helpful. And then just as a follow-up, I know you just had the Converge conference back in September and talked about augmented coding then. But what kind of interest have you seen from clients so far and what you're doing with augmented coding?
Well, the reaction is being pretty positive. I mean, it takes a while to be able to deploy the whole technology because it has to do with the source code that they use in each of the clients. So there's a lot of work around to be enabled to customers and a lot of interest from most of our customers and a lot of interest from most of our customers to move into this new technology. And the results so far from what we have been seeing are pretty impressive, not just providing the coder with a piece of code that is ready to be used and then you just need to change the variables. But now we are playing with the autocomplete.
So while you are typing, then the next sentence that is the most probable sentence that you need appears on your screen. And it's not just a syntax, it's autocomplete like you may have on any IDE, but it's something that is bringing is being brought by artificial intelligence in front of you, which is even more amazing than what we had before. So I'm very positive about the adoption of these technologies and I'm very positive about how these will differentiate Globant when we talk to our customers. This is very important. I mean, it's not just this is a platform that will allow us to differentiate our offering when creating software.
And this is one instance of reinvention of the industry. So every time I explain this, it's the adoption and it's also the opportunities that talking about this is providing in front of our customers and a positioning for our customers to see us as the reinvention of this industry using an accelerated by artificial intelligence and machine learning.
Okay, great. That's really helpful. Appreciate the insight there.
Thank you so much.
This concludes our question and answer session. I would like to turn the conference back over to Martin Migoya for any closing remarks.
Thank you very much for everyone for coming to our Q3 2020 earnings call. Thank you for your support, for your help during all these years and looking forward to see you on our next earnings call. Thank you.
The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.