- TCS exceeds ₹10,000 crore quarterly profit for the first time.
- The company reported 10% sequential growth in net profit to 10,431 crore from ₹9,478 crore last quarter.
- The headwinds of supply-side challenges are receding, said Samir Seksaria, the company’s chief financial officer.
IT Major TCS kicked off the second quarter earnings season on Monday, crossing the 10,000 crore net profit mark for the first time. The company reported 10% sequential growth in net profit to 10,431 crore from ₹9,478 crore in April-June.
Revenue for the quarter grew 4.8% on a sequential basis to 55,309 crore, while growing 15.4% year on year, in constant currency. Revenue growth has surpassed most analyst expectations – which were a 3% consecutive increase.
“Demand for our services remains very strong. We recorded strong, profitable growth in all our verticals and in all our key markets. Our order book is holding up well, with a healthy mix of growth and transformation initiatives, cloud migration and outsourcing agreements,” said Rajesh Gopinathan, CEO and MD of TCS.
The primary markets – North America and the EU – posted double-digit growth. While North America rose 17.6% in constant currency, the UK rose 14.8% and the EU grew 14.1%.
This is because management says demand for services remains “very strong” with growth in all verticals – the company’s order book was $8.1 billion at the end of the September quarter.
“We are steadily moving towards achieving our operating margin priority for the year, aided by leverage from good growth, the flattening of the workforce pyramid, steadily improving productivity and currency support. Importantly, the headwinds from supply-side challenges are easing, so that bodes well for the seasonally weak second half of the year,” said Samir Seksaria, the company’s chief financial officer.
|Particularities||Q2 FY23||Q1 FY23||Q2 FY22|
|Revenue||₹55,309 crore||₹52,758 crore||₹46,867 crore|
|Net profit||₹10,431 crore||₹9,478 crore||₹9,624 crore|
Source: Company Reports
The communications segment emerged as the best performing, followed by BFSI and retail.
|Segment||Q2 FY23||QoQ change|
|life sciences||₹1,694 crores||6%|
Source: Company Reports
Attrition for the company deteriorated, rising to 21.5% in the second quarter from 19.7% in the previous quarter. Overall, the company’s workforce was 6,16,171, with a net addition of 9,480 employees in the September quarter.
The company hired 20,000 freshmen in the second quarter, up 33% from the previous quarter. Overall, newer hires in H1 FY23 came in at 35,000, down from 43,000 in H1 FY22.
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