Mumbai: Leading IT bellwether Tata Consultancy Services (TCS) reported a flat 2.7% year on year (YoY) growth in revenue to ₹72, 673 crore for the quarter ended June 2026 from ₹70,725 crore last year. In constant currency terms, revenue has grown 3.2% year on year and 0.4% sequentially. The net profit for the quarter was ₹13,914 crore, a 2.7% decline from ₹14,228 crore in Q1 FY26. This came after the company had to pay ₹668 to settle the trade secrets lawsuits with DXC Technology following the rejection of its appeal.
The company has also seen its operating profits lower to 24%, a 130 basis points decline due to annual wage hikes. Though the company aims to move back towards 25% operating profit margins as early as possible, the cautious market sentiments have been a concern, with organizations moving to outcome based contracts with AI enhanced features to boost productivity and reduce costs.
India remained the company’s strongest market, with a 7.6% sequential revenue growth, while revenue from North America, Continental Europe, the Middle East and Africa have declined on a quarter-on-quarter basis.
“Q1 FY27 reflects continued growth momentum and the strength of our strategic positioning, despite geopolitical and macro-economic headwinds. We delivered a strong order book of $9.5 billion, including a marquee AI-led transformation deal with SKF, while continuing to add clients across key revenue bands and scaling our AI business to a $2.6 billion annualized revenue run rate. As customers accelerate investments in AI, modernization, cybersecurity, sovereign cloud and platform simplification, our strong deal conversion, improving client mining and expanding ecosystem partnerships position TCS well to translate opportunity into sustained growth”. K Krithivasan, Chief Executive Officer and Managing Director, said in a press release.
