Tata Consultancy Services (TCS) announced its Q1 FY26 results on July 10, reporting a 6% year-on-year rise in net profit to ₹12,760 crore, beating analyst estimates. However, revenue growth remained modest at ₹63,437 crore, missing market expectations amid weak
discretionary IT spending and macroeconomic headwinds. The company maintained strong operating margins and continued investments in AI and digital upskilling. An interim dividend of ₹11 per share was also declared
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Margins & Operational Metrics
EBIT Margin: 24.5%, up 30 bps QoQ from 24.2%
Net Margin: Approximately 20.1% .
Deal Wins (TCV): $9.4 bn, down from $12.2 bn in Q4
Headcount Growth: Added 6,071, total employees 613,069; attrition rate up to 13.8%
Cash from Operations: ₹12,804 cr .
Strategic Actions & Commentary
Dividend Declared: Interim dividend of ₹11/share; record date July 16, payout scheduled August 4, 2025
AI & Skill Investment: 15 million training hours; 114,000 employees with higher-order AI skills
Leadership Take: CEO K Krithivasan noted macroeconomic and geopolitical uncertainties dented demand, though new services performed well. CFO Samir Seksaria highlighted steady margins and strategic investment for sustainable growth
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Financial Performance
Net Profit (PAT): ₹12,760 cr, up 6% YoY (from ₹12,040 cr) — ahead of analyst estimates (~₹12,253 cr
Revenue from Operations: ₹63,437 cr, a modest 1.3% rise YoY (₹64,600 cr). In constant currency terms, revenue declined ~3.1% YoY
DIGI MERCH STORE PRINT ON DEMAND
Analyst & Market Reaction
Revenue shortfall attributed to lower discretionary spending and the tapering of a major BSNL deal (~$1.83 bn)
Most analysts expected flat-to-slight revenue growth but margins held firm due to wage deferments and currency benefits.
TCS shares responded mildly, with the stock closing slightly lower after results
Comment:
