TCS Q1 order book declines 18% to $8.3 billion

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India’s largest IT services company Tata Consultancy Services (TCS) saw a sharp drop in deal wins in the first quarter of FY25 with the order book at $8.3 billion.

Its total contract value (TCV) for the quarter was 18.6 percent lower from the $10.2 billion in the year-ago period and 37 percent down from the previous quarter, the company said on July 11.

In the March quarter of FY23, the Tata group company reported a record-high order book of $13.2 billion.

Some of the deals won in the quarter include a generative AI and cloud transformation deal with Xerox, a GenAI partnership with Amazon Web Services and a BFSI deal with Burgan Bank few.

“I am pleased to report a strong start to the new fiscal year with all-round growth across industries and markets. We are continuing to expand our client relationships, create new capabilities in emerging technologies and invest in innovation, including a new AI-focused TCS PacePort™ in France, IoT lab in the US and expanding our delivery centres in Latin America, Canada and Europe,” TCS chief executive officer and managing director K Krithivasan

Geographically, demand was led by India market, which grew 61.8 percent YoY in constant currency (CC) terms, followed by MEA at 8.5 percent, Asia Pacific at 7.6 percent and Latin America at 6.3 percent.

Core markets, including North America, declined 1.1 percent in CC YoY. The UK grew 6 percent but Continental Europe only 0.9 percent.

Among verticals, BFSI, which accounts for 30-40 percent of the revenue, continued to slip, declining 0.9 percent YoY in CC terms. Consumer business was down 0.3 percent, technology services 3.9 percent and communication and media slumped 7.4 percent.

Surprisingly, regional markets continued to grow, at 37.7 percent YoY. Manufacturing was up 9.4 percent, life sciences and healthcare grew 4 percent and energy resources and utilities grew 5.7 percent YoY.

TCS reported a 9 percent year-on-year increase in net profit at Rs 12,040 crore for the quarter. Its revenue from operations rose 5.4 percent to Rs 62,613 crore.