 "TCS Q2FY25 results: Net profit rises 5% to Rs 11,909 cr, revenue up 7.6%")
India’s largest IT services player, Tata Consultancy Services (TCS), reported a net profit of Rs 11,909 crore for the second quarter of the financial year 2024-25, up 5 per cent compared to Rs 11,342 crore in the same quarter of FY24.
Revenue for the company grew 7.6 per cent to Rs 64,259 crore for Q2 FY25. Sequentially, the firm’s revenue grew 2.62 per cent.
The company’s performance compared to Bloomberg estimates was a beat on the topline but missed the profit estimates. According to Bloomberg estimates, revenue was expected at Rs 64,177 crore, and net profits at Rs 12,547 crore.
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The order book total contract value (TCV) was marginally up at $8.6 billion in Q2 FY25. In Q1, the TCV was $8.3 billion. North America TCV came in at $4.2 billion, BFSI TCV at $2.9 billion, and Consumer Business TCV at $1.2 billion.
K Krithivasan, chief executive officer and managing director, said: “We saw the cautious trends of the last few quarters continue to play out in this quarter as well. Amidst an uncertain geopolitical situation, our biggest vertical, BFSI, showed signs of recovery. We also saw a strong performance in our Growth Markets. We stay focused on sharpening our value proposition to our clients, employees, and other stakeholders”.
The company’s Q2 performance was similar to its Q1, where regional markets grew, but major markets such as the US and Europe continued to be soft. India grew by 95.2 per cent year-on-year. Middle East & Africa, Asia Pacific, and Latin America grew by 7.9 per cent, 7.5 per cent, and 6.8 per cent, respectively.
Meanwhile, North America was down 2.1 per cent Y-o-Y. Within Europe, the UK grew by 4.6 per cent and Continental Europe was up 1.8 per cent.
Among the verticals, growth was driven by Energy, Resources and Utilities (+7.0 per cent), and Manufacturing (+5.3 per cent). The company’s largest vertical, BFSI, was up 0.1 per cent.
During the quarter, the company added 5,762 people. For the first half of the financial year, TCS has onboarded 11,000 employees.
Milind Lakkad, chief human resources officer, said: “We welcomed 11,000 associates in the first half of the year, and we remain on track for trainee onboarding as planned. We have also commenced the campus hiring process for FY26. Our strong talent base and increased learning intensity prepares us well for the complex technology transformations that customers entrust us with”.
Operating margins for the quarter came in at 24.1 per cent. Samir Seksaria, chief financial officer, said: “We made strategic investments this quarter in talent and infrastructure to ensure sustainable growth. Our disciplined execution resulted in superior cash conversion. Our longer-term cost structures remain unchanged, and we remain confident in our ability to continue delivering industry-leading profitable growth”.