TCS Q2 Results: Revenue Meets Expectations, Profits Miss the Mark - Read Now
Tata Consultancy Services Ltd. (TCS) released its Q2 results for the July-September period, with mixed outcomes. While revenue in rupee terms met expectations, other key financial metrics fell short of market predictions.
TCS, a leading tech services giant of the Tata Group, reported a net profit of ₹11,909 crore, missing the CNBC-TV18 estimate of ₹12,422 crore. This represented a 1.1% decline from the previous quarter.
Revenue Performance
TCS reported revenue of ₹64,259 crore, a growth of 2.6% from the June quarter, and close to the ₹64,160 crore estimate analysts had predicted. In US dollar terms, TCS posted revenue of $7,670 million, a 2.2% growth, aligning with market expectations of 2% growth.
EBIT and Margins
The company's EBIT (Earnings Before Interest and Tax) came in at ₹15,465 crore, showing a marginal 0.1% growth compared to the previous quarter, but lower than the estimated ₹15,950 crore. The EBIT margin narrowed to 24.1%, down by 60 basis points, while analysts expected 24.85%.
Sector-wise Growth and Challenges
TCS saw growth primarily driven by the energy, resources, utilities, and manufacturing sectors. However, the ongoing geopolitical uncertainties continued to impact the company's performance, especially in its BFSI (Banking, Financial Services, and Insurance) vertical, which showed signs of recovery.
K Krithivasan, CEO & MD of TCS, commented, "We saw the cautious trends of the last few quarters continue to play out. Amidst an uncertain geopolitical situation, our biggest vertical, BFSI, showed signs of recovery."
Headcount and Attrition
The company saw a net headcount reduction of 5,726 employees during the quarter, with an attrition rate of 12.3%. Despite this, TCS welcomed 11,000 new associates in the first half of the year and remains on track for trainee onboarding. The campus hiring process for FY26 has also begun, according to Milind Lakkad, Chief HR Officer of TCS.
Stock Performance
TCS shares ended the day 0.7% lower, closing at ₹4,221, near their lowest point of the day.
