The company reported a net profit of ₹4,235 crore on revenue of ₹31,942 crore for the quarter ended September 30. Estimates in an ET poll of analysts ranged ₹4,136-4,491 crore for net profit and ₹31,252-31,603 crore for revenue.
In a first for an Indian IT services company, the Noida-headquartered firm reported standalone quarterly revenue of $100 million (around ₹886 crore) from artificial intelligence-related services.
While AI still accounts for under 3% of the total revenue, chief executive officer C Vijayakumar said he expects this to grow “because there are a lot of factory requirements, inferencing, silicon design and validation requirements”. “So, I think all of this plays very strongly into our traditional strengths and a number of industry domain solutions that we have built.”
Vijayakumar added: “A lot of discretionary spend is happening on AI because customers have invested in solutions and capabilities, and they really want to make them work and scale within their enterprise and that’s where a lot of our services (are). I see a strong growth potential for our advanced AI services.”
The company’s revenue growth was backed by healthy engineering, research and development (ER&D) services, which expanded more than 13%. An over 7% increase in revenue from Europe and double-digit growth in the financial services and technology & services segments also boosted overall performance. The July-September period is a historically soft quarter for the company’s software business, where revenue shrank 3.7% on-year in constant currency terms, which excludes the impact of currency movements.”Overall, the demand environment is more or less similar to what we saw in the last quarter…The only area which is soft is the auto segment, which we feel is still struggling, but for all others, we feel good,” the CEO further said. Supported by a 44% increase in deal bookings, HCLTech revised its services revenue growth guidance to 4-5% from the earlier 3-5%. It maintained the company-level revenue growth outlook of 3-5% in constant currency for the fiscal year ending March 2026.
On similar terms, revenue in the past quarter rose 2.4% sequentially and 4.6% from a year earlier to $3.6 billion.
Last week, HCLTech’s largest rival, Tata Consultancy Services, kicked off the earnings season, reporting weaker-than-expected numbers with net profit falling 1.4% from a year earlier and 5.4% sequentially, also impacted by a one-time restructuring fee. The Tata Group firm laid off 1% of its workforce and reported its largest quarterly headcount drop of 19,755. Revenue grew 2.4% from a year earlier and 3.7% from the prior quarter.
AgenciesHeadcount challenges
While the HCLTech management refused to directly call out any specific employee reduction, chief people officer Ramachandran Sundarajan said: “On the people’s side is largely the skill-location mismatch, it’s not a capacity reduction agenda. It’s basically rebalancing the demand-supply when it comes to skills and locations. And some of it is also through the acquisitions that we have had over the years. It’s small numbers spread out across multiple countries.”
Given the “strong performance” this quarter, the management said it plans to roll out the annual salary increments effective October. “We’ll follow the same process as we did last year, in terms of how we go about running the increment process,” Sundarajan said.
The company also decided to move the quarterly variable pay into fixed pay and merge it with fixed salary for all employees, he said. HCLTech added 3,489 employees during the quarter, against a net reduction of 269 employees in the past quarter.
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