IT services firm HCLTech on July 14 reported 10% decline in consolidated net profit at Rs 3,843 crore for the quarter ended June 30, 2025. The firm reported consolidated net profit of Rs 4,257 crore in the year-ago period.
This comes at a time when the IT services industry is grappling with demand slowdown due to macroeconomic uncertainties and global trade tensions.
The IT firm's consolidated revenue from operations rose 8% to Rs 30,349 crore in Q1FY26 as against Rs 28,057 crore in Q1FY25.
Operating margin for the quarter has plunged to 16.3% in Q1, sequentially down by 160 bps from 17.9% in Q4FY25.
The firm declared interim dividend of Rs 12 per share and record date is July 18.
HCLTech has revised its FY26 constant currency revenue growth guidance to 3-5%. The company has raised its guidance on the upper end from from 2-5% announced in the previous quarter.
HCLTech has also revised its operating margin guidance for FY26, reducing it to 17-18% from 18-19% previously.
The company's net new deals stood at $1.81 billion in April-June quarter versus $3 billion a quarter ago.
“We had healthy revenue growth of 3.7% YoY supported by good performance in our Services business with 4.5% YoY growth in constant currency. Our operating margin came at 16.3%, impacted by lower utilization and additional Gen AI and GTM investments. Our AI propositions are resonating well with our clients and have been augmented further by our partnership with Open AI. Our pipeline continues to grow as the demand environment was stable during the quarter," said C Vijayakumar CEO & Managing Director HCLTech.
During the company's Q1 earnings conference, Vijayakumar noted that there were delay in closure of at least two large deals in Q1, that led to lower order book value. But he added that these were procedural delays that the deals would close by July end, and the order book in Q2 will be relatively higher. There was no impact of macro uncertainties or external factors on the deal closure timelines, he said.
"HCLTech Q1 FY26 INR revenue grew an impressive 8.2% YoY. EBIT for the quarter came in at Rs 4,942 crore and Net Income (NI) at Rs 3,843 crore and at 16.3% and 12.7% of revenue respectively. Our cash generation remains robust with OCF/NI at 129% and FCF/NI at 121%, reflecting the underlying strength of our business model. Our commitment to capital efficiency has resulted in LTM ROIC improving for the company by 353 bps YoY to 38.1% and for Services business by 236 bps YoY to 45.2%," said Shiv Walia, Chief Financial Officer, HCLTech.
Ahead of the results, HCLTech shares on NSE fell by 1.51% on July 14 to close at Rs 1,613.50 apiece.
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