HCL Tech Q3 Results Highlights: Net profit falls 11% to Rs 4,076 crore, firm announces Rs 12 dividend

Along with the Q3 results, HCL Tech announced an interim dividend of Rs 12 per equity share for FY26. The record date to determine the eligibility of the shareholders set to receive the dividend has been set on January 16. The dividend will then be paid to the eligible shareholders on January 27.

HCL Tech reported a consolidated net profit of Rs 4,076 crore for Q3 FY26, marking a 11% YoY fall from the Rs 4,591 crore in Q3 FY25. The firm's revenue from operations meanwhile rose 13% YoY to Rs 33,872 crore.

HCL Tech is set to announce its October-December quarter earnings today after peer TCS kickstarted the earnings season for the IT segment. The company may also announce its fourth interim dividend for the financial year 2026.

Tata Consultancy Services (TCS) has reported $1.8 billion in annualised artificial intelligence (AI) revenue, growing 17.3 percent sequentially in constant currency term, higher than the IT services giant’s overall sequentially growth of 1.96 percent.

The demand for AI was largely driven by customers’ continued investments in Cloud, Data, Cyber and Enterprise Transformations to build readiness for AI.

Due to its restructuring excersise, which saw mass layoffs being announced last year, TCS reported Rs 253 crore as an exceptional item. "Termination benefits have been provided as per policy devised for this purpose," it said.

The restructuring cost incurred in Q3 FY26 was 77 percent lower than the Rs 1,135 crore reported in the previous quarter (Q2 FY25).

TCS reported Rs 1,010 crore as an exceptional items arising out of Computer Sciences Corporation's legal claim in US, alleging misappropriation of trade secrets and other confidential information. "The Company, based on consultation with the external lawyers and legal assessment, believes that it has a strong case and would defend its position vigorously and pursue legal remedies to overturn the decision of the Fifth Circuit," TCS said.

"Our sustained margin performance and strong cash conversion this quarter, reflects our disciplined execution and financial resilience. Backed by a robust balance sheet, we continue to invest confidently in strategic growth areas. Executing our five-pillar AI strategy at speed and scale is central to our transformation into an AI-first enterprise, and delivering long-term value for our

stakeholders," said TCS CFO Samir Seksaria.

"We continued to see AI acceleration this quarter. We helped customers identify valuable AI opportunities through Innovation Days and deployed solutions faster with Rapid Builds. Our customers continue to invest in Cloud, Data, Cyber and Enterprise Transformations to build readiness for AI. We further strengthened our Salesforce capabilities with Coastal Cloud acquisition, building on our investment in ListEngage," said Aarthi Subramanian, Executive Director - President and Chief Operating Officer of TCS.

"The growth momentum we witnessed in Q2FY26 continued in Q3FY26. We remain steadfast in our ambition to become the world’s largest AI-led technology services company, guided by a comprehensive five-pillar strategy. Our AI services now generate $1.8 billion in annualized revenue, reflecting the significant value we provide to clients through targeted investments across the entire AI stack, from Infrastructure to Intelligence," said TCS CEO and Managing Director K Krithivasan.

TCS saw its headcount decline by 11,151 employees to 582,163 at the end of the third quarter of the ongoing financial year 2026.

TCS reported Total Contract Value (TCV) at $9.3 billion. Annualized AI Services Revenue rose 17.3% QoQ to $1.8 billion in CC terms. Operating Margin remained stable sequentially at 25.2%, while net income rose 8.5% YoY to Rs 13,438 crore.

Tata Consultancy Services (TCS) on January 12 reported Rs 2,128 crore as an exception item weighing down on its Q3 profit due to statutory impact of new labour codes implemented in India.

The comes as the IT major reported a 14 percent year-on-year (YoY) fall in consolidated net profit to Rs 10,657 crore for the October-December quarter of the ongoing financial year 2026.

TCS announced an interim dividend of Rs 11 per share and a special dividend of Rs 46 per share. The third interim dividend and the special dividend shall be paid on February 3.

The record date to determine the eligibility of shareholders set to receive the payment has been set on January 17.

TCS reported a consolidated net profit of Rs 10,657 crore for Q3 FY26. This marks a 14% YoY fall from the Rs 12,380 crore net profit reported in Q3 FY25. The firm's revenue from operations however rose 5% YoY to Rs 67,087 crore during the quarter under review.

TCS shares closed more than 1% higher at Rs 3,243 apiece. The company is set to announce its earnings for the October-December quarter of the ongoing financial year 2026.

Tata Consultancy Services (TCS) reported a 1.4 percent year-on-year rise in consolidated net profit to Rs 12,075 crore for the quarter ended September 30, 2025, slightly below Street estimates. A CNBC TV18 poll had pegged the IT major’s profit at Rs 12,528.3 crore and revenue at Rs 65,114 crore.

TCS declared a second interim dividend of Rs 11 per share, with October 15 as the record date and November 4 as the payment date.

Net profit was down sequentially as the company declared restructuring expenses of Rs 1,135 crores, driven by the ongoing job cuts that will impact over 12,000 employees.

TCS kicks off earnings for Indian IT firms, which are expected to report muted quarter on tepid US demand and holiday-period client shutdowns, nine brokerages said, reported Reuters.

HCL Tech shares slipped into the red, dropping 0.024% to trade at Rs 1,661 apiece. The company is set to announce its earnings for the October-December quarter of the ongoing financial year 2026.

The shares of Tata Consultancy Services (TCS) were trading in the green with marginal gains. The stock is up 0.25% to trade at Rs 3,215.70 apiece. The company is set to announce its earnings for the October-December quarter of the ongoing financial year 2026.

Ambit Capital expects near-term risk to TCS' outlook of higher international market growth in FY26 versus FY25, given elevated ask rates of 1.5% CQGR over H2FY26.

In 2025, TCS made headlines following its plan to layoff around 2 percent of its global workforce to become more agile and future-ready amid rapid AI disruptions.

The move, which started in April 2025 and will continue till March, will impact employees across countries and domains in which it operates.

As of Q2, Chief HR Officer Sudeep Kunnumal said the company had released one percent, or 6,000 people, as part of its restructuring exercise.

TCS is also updating its fresher and lateral hiring strategy. While it had set a target of adding 42,000 freshers in FY26, COO Aarthi Subramanian shared the IT giant will now double down on AI-native fresher or trainee hiring.

In terms of lateral hiring, TCS will hire more in areas such as cyber security, enterprise solutions, cloud, advisory and consulting talent, that’s positioning them closer to customers.

“Today more than 50 percent of our experience hires are you know are coming with next gen skill sets,” Subramanian said during the Analyst Day in December.

Amid these changes, commentary on hiring will be in focus.

TCS is also focusing on expanding local hiring in the US and Latin America amid growing uncertainties around H-1B visa rules in North America. TCS has set up a new subsidiary in Costa Rica this quarter to expand workforce in the country.

Over the years, TCS has been reducing its dependency on H-1B visas, and has sent only 500 associates on new H-1Bs this year.

After nearly a decade of shying away from acquisitions and focusing on building newer capabilities in-house, TCS joined the M&A band wagon which rivals Accenture, Cognizant and Capgemini who are known for.

In less than a quarter, TCS acquired two Salesforce consulting firms, ListEngage MidCo for $72.8 million and Coastal Cloud in a $700-million all-cash buyout.

ICICI Securities' analysts estimate $6 million (+0.08 per cent QoQ USD) quarterly contribution from ListEngage.

Investors will look forward to updates on the capabilities TCS plans to add and acquisition budgets.

AI will be the biggest talking point following the announcements at TCS Analyst Day 2025 on December 17. The IT services player clocked $1.5 billion in annual AI revenue and has worked on over 5,500 AI projects till date.

The $1.5 billion AI revenue accounts for nearly 5 percent of TCS’ estimated FY26 revenue, growing at 28.2 percent YoY CC annually, a ICICI Securities pre-earnings note said.

This is the first time the company has disclosed details on its AI revenue and deal pipeline. The December quarter saw TCS double down on its investments to build AI infrastructure.

At Q2 earnings conference in October, the company's management shared its plans to invest approximately $6.5 billion into building 1 GW of data centre capacity over the next five to seven years.

As of November, TCS said it will be investing $2 billion (Rs 18,000 crores) along with global alternate asset management firm TPG to fund its AI data centre business, HyperVault. The investment will happen in tranches over the next few years.

According to a pre-earnings research note from Motilal Oswal Financial Services, global LLM leaders such as OpenAI and Claude have started partnering with the system integrators (SIs), suggesting that the AI services layer is set to formalise and gain momentum over the next six months.

Analysts expect AI services demand to improve from mid-2026, as hardware-led AI capex intensity moderates and spending gradually shifts toward software, platforms and services.

“The Mar-Apr’26 budget reset period may serve as an initial indicator, with some AI programmes potentially transitioning from preparation to early deployment,” the note said.

While TCS’ AI investment plans is largely seen as promising in the long-run given its good cash flow availability, there are still sections of the Street that remains cautious of the "capex-heavy" turn in its business model.

TCS announced around eight deals during the quarter, the highest among Tier-I IT players. Analysts at ICICI Securities have pegged quarterly deal total contract value (TCV) in the range $7 billion-$9 billion.

Some of the key deal wins include a five-year contract with SAP for four Centers of Excellence for Gen AI, customer experience, cloud; a digital transformation deal with British food retailer Morrisons; a five-year partnership with Tata Motors and expansion of its 15-year old partnership with UK insurance company Aviva among others.

Brokerages will watch out for management commentary around CY26 IT client budgets, sentiment on discretionary spending, AI/ Gen AI deal pipeline, demand trends in BFSI, retail, hi-tech, manufacturing and communications. Updates on deal signing and revenue conversion on the Rs 2,903 crore advance purchase order (APO) from BSNL will be tracked as well.

Brokerages have pegged TCS’ revenue growth between 0.5 percent and 1 percent quarter-on-quarter in constant currency. The growth was driven by ramping up of deals from the previous quarters, led by BFSI and communications verticals.

“Tepid growth is largely due to seasonal softness, lower billing days in international markets and also no major ramp up expected in BSNL deal,” a pre-earnings research note from Equirius Securities said.

EBIT margins is expected to decline by around 20 basis points sequentially on wage hike rollout and December being a seasonally weak quarter.

The October-December period was marked by some crucial strategic announcements by the IT services behemoth, including its largest ever acquisition of Coastal Cloud, and data centre investments, as the company charts its course to become the “world’s largest AI-led tech services company” in CEO K Krithvasan’s words.

The company is in the middle of an organisational restructuring with 2 percent job cuts, AI skilling and a shift in hiring strategy.

Along with TCS, its IT peer HCL Technologies will also announce its earnings for the October-December quarter of the ongoing financial year 2026. Anand Rathi Wealth is also among the 17 companies releasing Q3 FY26 results today.

India’s largest IT services company Tata Consultancy Services (TCS) will kick start the earnings season today by announcing its results for the October-December quarter of the ongoing financial year 2026.