January 11, 2024 : Tata Consultancy Services (TCS), India’s leading IT services company, revealed a net profit of Rs 11,058 crore for the quarter ending December 31, 2023. This reflects a 2% increase compared to the corresponding period the previous year, despite challenges such as high furloughs in the BFSI and hi-tech sectors, along with a continued slowdown in discretionary spending.
Although the net profit showed a 2.5% decline on a sequential quarter basis, it still managed to surpass Moneycontrol’s estimates. The consolidated revenue for the same period witnessed a 4% year-on-year rise, reaching Rs 60,583 crore, up from Rs 58,229 crore in the previous year.
TCS reported an improved EBIT margin or operating margin of 25%, expanding from 24.3% in the preceding quarter, surpassing the estimates provided by Moneycontrol.
In a significant move, the TCS board approved a dividend of Rs 27 per share, inclusive of a special dividend of Rs 18 for the fiscal year 2023-2024.
Important Details:
- Net profit for Q3 2023 stands at Rs 11,058 crore, showing a 2% YoY increase.
- Consolidated revenue rises by 4% YoY to Rs 60,583 crore.
- EBIT margin improves to 25%, beating expectations.
- TCS board approves a dividend of Rs 27 per share, including a special dividend of Rs 18.
- TCS reports a decline in headcount for the second consecutive quarter, down by 5,680 in Q3.
Commenting on the performance, K Krithivasan, CEO, and MD of TCS, stated, “Our strong performance in a seasonally weak quarter buffeted by macro-economic headwinds demonstrates the strength of our business model with a well-diversified portfolio and a customer-centric strategy.”
He added, “We are seeing strong deal momentum across markets resulting in a solid order book providing visibility into our long-term growth. We are seeing tremendous interest in Generative AI and are leading the innovation and exploratory efforts for our customers in this area.”
N Ganapathy Subramaniam, COO, and Executive Director, highlighted the progress in national projects and the strong quarter for TCS’s products and platforms. Despite the decline in headcount, TCS remains optimistic about its future growth prospects, showcasing resilience in the face of economic challenges.
