Shares of EPAM, a Newtown, Bucks County-based software-outsourcing firm, closed down by 46% Monday after the company said it was helping evacuate its engineers from Ukraine amid the Russian invasion and warned that it could no longer predict its financial results for this year, due to “military actions in Ukraine.”
The company’s “highest priority is the safety and security of its employees and their families in Ukraine, said EPAM in a statement. So it is “working to relocate its employees to lower-risk locations in Ukraine and neighboring countries.” EPAM has not expressed any public position on the war itself, which divided countries where it has many workers. The war has been condemned by Western leaders, and Russia is facing a host of economic sanctions, including efforts to freeze the assets of the Bank of Russia.
On a day when jittery investors worried about the escalation of the war and the impact of Western sanctions on Russia, EPAM closed at $207.75 a share. Its 45.68% drop was the largest for the three main U.S. stock exchanges.
That’s a drop of more than 70% from the stock’s 2021 high and follows another big drop when Russia invaded last week. The decline since November has cut EPAM’s value to investors by more than $35 billion.
EPAM employs about 14,000 people in Ukraine, and several thousand others in Belarus and Russia, according to its U.S. filings. More than half of its production of over $3 billion worth of software in the last year came from Ukraine and neighboring Russia and Belarus, founder and chief executive Arkadiy Dobkin told investors in a conference call Feb. 17.
Russia has since invaded Ukraine, seeking to topple its elected government, which is friendly to the U.S. and other NATO nations, and which Russian leaders say without evidence is a threat to them.
Worried that its engineers will be drafted into the military, forced to flee, or left unable to work in war zones, EPAM said it is also “accelerating hiring across multiple locations in Central and Eastern Europe, Latin America, and India.”
EPAM, an information technology services provider, was founded by Dobkin, a Belarus native, in 1993 to take advantage of the large supply of software professionals willing to work for lower wages in eastern Europe after the Berlin Wall fell and the nations of the former Soviet Union began to welcome Western investment and business.
A week before the invasion, Dobkin told investors he didn’t expect that Russia’s expected attack on its neighbor would affect EPAM’s prospects much more than Russia’s 2014 attacks that installed Russian troops in Ukraine’s Crimea and parts of its Donetsk and Luhansk regions.