Tata Communications posts fastest quarterly revenue growth in 9 years

Its margins on earnings before interest, taxes, depreciation, and amortization (EBITDA) contracted to 20.1% from 23.8% a year earlier.

Shares of the company closed 4.3% higher after the results. They fell 8.4% in the December-quarter after rising for two straight quarters.

Tata Communications has been focusing on growing its revenue over margins, partly through acquisitions in the past few quarters, as it seeks to grab a bigger share of the highly competitive market for cloud, networking services, media and entertainment.

Its margins on earnings before interest, taxes, depreciation, and amortization (EBITDA) contracted to 20.1% from 23.8% a year earlier. Net profit fell 88.6% to 448.1 million rupees due to a one-time charge.

Revenue from the data services segment, which contributes more than 80% to the total, climbed 28.3% on robust demand in its core connectivity and digital portfolio segments.