India's IT bellwether Tata Consultancy Services (TCS) reported its December quarter (Q3) numbers on Thursday, which were largely in line with market expectations.
While Q3 is a seasonally weak quarter for IT companies, TCS said it witnessed strong TCV (total contract value) during the quarter, paving the way for its long-term growth.
“We are pleased with the excellent TCV performance in Q3, which was well-rounded across industries, geographies, and service lines, lending good visibility to long-term growth," said K Krithivasan, chief executive officer and managing director.
"BFSI and CBG are returning to growth, and the continued stellar run of regional markets and early signs of revival in discretionary spending in some verticals give us confidence for the future. Our continuing investments in upskilling, AI/Gen AI innovations, and partnerships set us up to capture the promising opportunities ahead,” said Krithivasan.
The company's consolidated revenue from operations grew 5.6 percent year-on-year (YoY) to ₹63,973 crore from ₹60,583 crore in the same quarter last year. In constant currency (CC) terms, the company's revenue rose 4.5 percent.
Profit for the period under review attributable to shareholders came at ₹12,380 crore, up 12 percent YoY, from ₹11,058 crore in Q3FY24.
Operating margin stood at 24.5 percent, down 50 bps YoY. However, it improved by 40 bps quarter-on-quarter (QoQ).
Among the key domains, BFSI, which saw a 0.1 percent YoY growth in CC terms last quarter, increased 0.9 percent YoY. The consumer business segment grew 1.1 percent YoY in CC terms.
However, the communication and media segment de-grew 10.6 percent YoY, and the life sciences and healthcare segment de-grew 4.3 percent YoY.
Except for North America and Continental Europe, which declined 2.3 percent and 1.5 percent YoY in CC terms, all major geographical markets saw decent growth in Q3.
Indian markets grew 70.2 percent YoY, followed by MEA (up 15 percent YoY).
TCS saw a strong TCV at $10.2 billion during the quarter, with a book-to-bill ratio of 1.4.
Among the key deal wins during the quarter were an extended partnership with Telenor Denmark, a multi-year deal with Air France-KLM, and a 15-year contract with Ireland’s Department of Social Protection.
TCS was selected by Canada’s largest worker compensation board, the Workplace Safety and Insurance Board (WSIB), as a strategic partner to transform the enterprise quality assurance landscape.
The company entered a multi-year deal with a leading US life and annuities provider to transform their business operations with TCS’ AI-powered solutions and industry-proven operational efficiency levers.
Moreover, a US-based telecom major has entered a 5-year strategic relationship with TCS to provide managed services for specific solutions.
TCS’ workforce stood at 6,07,354 as of December 31. The employee base is diverse, with 35.3 percent of the workforce women and 152 nationalities. IT services’ attrition was 13 percent for the last twelve months.
TCS declared a third interim dividend of ₹10 and a special dividend of ₹66 per share of ₹1 each of the company.
The third interim dividend and the special dividend shall be paid on February 3 to the equity shareholders of the company. The record date for this purpose is January 17.
(By arrangement with livemint.com)
