IT services firm Tech Mahindra reported a net employee decline of 4,354 sequentially for the quarter ended December 31, in line with the larger industry-wide trend of slowdown in hiring amid macroeconomic challenges and demand uncertainties.
The total headcount for Q3 was 146,250. In the last quarter, Tech Mahindra added 2,307 employees.
The attrition rate dropped from 11 percent in Q2 to 10 percent in Q3, continuing the trend of declining attrition rates since the start of fiscal year 2023.
This quarter, three of the India's five Tier-I IT companies have reported a steep decline in headcount. Tata Consultancy Services (TCS) lost 5,680 employees, Infosys' headcount dropped by 6,101, Wipro was down by 4,473 and HCLTech reported an addition of 3,617 employees.
Tech Mahindra is also was focusing on building generative AI talent. As of Q3, Tech Mahindra had upskilled around 60,000 associates.
As of Q2, Tech Mahindra had upskilled around 10,000 associates.
This is the first quarter since the new CEO, Mohit Joshi, completely took over the reins from the former CEO, CP Gurnani. To turnaround and improve the current state of the business, Joshi restructured the organisation and the leadership team, which came into effect on January 1.
The company's current focus is on diversifying further into other segments, including BFSI (Banking, Financial Services, and Insurance), healthcare and life sciences. Currently, nearly 40 percent of the company's revenue comes from the Communications, Media, and Entertainment (CME) business.
Tech Mahindra announced its Q3 earnings on January 24. Net profit fell 60.6 percent, down to Rs 510 crore year-on-year (YoY), significantly below Moneycontrol's estimate of a 41 percent decline YoY, which was Rs 763 crore.
Consolidated revenue for Q3FY24 declined 5 percent YoY to Rs 13,101 crore, largely in line Moneycontrol’s estimate of Rs 12,957 crore.
EBIT or operating margin improved sequentially to 5.4 percent, up from 4.7 percent last quarter. This also missed Moneycontrol's estimate of 7 percent.
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