Globant (GLOB) is still in the early stages of its turnaround as it continues to shift focus to AI-native services, with growth anticipated to return in Q2 and accelerate in H2, Wedbush said in a Friday note.

The company's Q1 total revenue beat expectations as more clients adopt its AI studios offering, with AI model independence and token sovereignty enabling flexibility for their internal use cases, Wedbush analysts said.

Meanwhile, Globant's AI Pods generated $32.8 million in revenue, an increase sequentially from $20.4 million, with 40% of its top 20 customers incorporating the offering, up from 30% in the prior quarter, according to the note.

The offering also expanded its sales pipeline to $352 million from $283 million in the previous quarter, positioning the company closer to becoming an AI-native tech services firm, the analysts said.

Globant needs to navigate an uncertain and complex macro environment that has made clients hesitant to commit large investments, the note said.

Wedbush maintained the company's stock rating at outperform and lowered the price target to $54 from $61.

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