HCLTech beats forecasts as quarterly growth hits three-year low

what happened

According to MINT, HCL Technologies posted quarterly revenue of $3.72 billion, up 2% from June and 2.2% from a year earlier. A Bloomberg poll of 34 analysts had pointed to $3.68 billion. Despite the beat, growth in the September quarter was the company’s slowest in three years as demand for traditional technology offerings stalled. Telecom and media companies generated more than half of the incremental revenue and represented slightly more than a tenth of the business.

HCLTech reported $3.3 billion in new orders for the quarter, lifting first-half wins to a record $5.67 billion, according to management. Advanced AI revenue rose 28% sequentially to $219 million, while net profit increased 10.25% to $538 million. The company raised the lower end of its FY27 revenue-growth outlook from 1% to 2.5%, leaving the upper end at 4% in constant-currency terms.

In July, HCLTech announced a $365 million investment to build and operate data centres of up to 50MW. A month earlier, it acquired about 10% of Sarvam AI for roughly $150 million. Management expects the data-centre initiative to contribute revenue in the second half of FY28 and kept its operating-margin target at 17.5-18.5%. The company added 6,450 employees, ending the first half with 230,339 staff.

why it matters

The results point to resilient deal activity and rapid AI growth, but also show continued pressure on conventional IT spending. Investors will be watching management’s comments on ongoing AI-led revenue deflation, alongside TCS’s assessment that discretionary client spending remains under scrutiny.

instruments