Tata Consultancy Services (TCS) reported a Q1 FY25 results that met expectations, with the consolidated net profit rising 9% YoY to Rs 12,040 crores. TCS Q1 results showed a 5.4% YoY increase in revenue from operations to Rs.62,613 crores in Q1 FY25, up from Rs.59,381 crores in the year-ago period. Sequentially, revenue increased by 2.2% compared to Rs.61,237 crores in Q4 FY24. The company's operating margin was 24.7%, with an expansion of 1.5% Y-o-Y. The EBIT margin narrowed to 24.7 percent for Q1, a 130 basis points fall from 26 percent in the previous quarter. Net margin was 19.2%, and net cash from operations was Rs.11, 168 crores, or 92.8% of net income. TCS Q1 results showed that the company's margins took a hit due to the wage hike cycle during the quarter.
In terms of research and innovation, TCS has applied for 8,194 patents; including 154 applied during the quarter, and has been granted 4,146 patents, including 227 granted during the quarter.
Geographically, demand was led by the India market, which grew 61.8% YoY in CC terms, followed by MEA growing 8.5% YoY CC, Asia Pacific at 7.6% YoY CC, and Latin America grew 6.3% YoY in CC. Largest markets including North America, UK, and Continental Europe grew only 0.9% YoY in CC YoY.
| Geography | Composition (%) | Y-o-Y | |
| Q1 FY24 | Q1FY25 | CC Growth (%) | |
| Americas | |||
| North America | 52 | 49.5 | -1.1 |
| Latin America | 2 | 1.9 | 6.3 |
| Europe | |||
| UK | 16.4 | 16.9 | 6 |
| Continental Europe | 14.9 | 14.4 | 0.9 |
| Asia Pacific | 7.8 | 7.8 | 7.6 |
| India | 4.9 | 7.5 | 61.8 |
| MEA | 2 | 2 | 8.5 |
| Total | 100 | 100 | 4.4 |
Among verticals, BFSI, consumer business, technology services, and communication and media declined YoY by 0.9% in CC terms. However, regional markets continued to grow 37.7% YoY in CC terms, manufacturing grew by 9.4%, Life Sciences and Healthcare grew by 4%, and Energy Resources and Utilities grew 5.7% YoY.
| Industry | Composition (%) | Y-o-Y | |
| Q1 FY24 | Q1FY25 | CC Growth (%) | |
| BFSI | 32.5 | 30.9 | -0.9 |
| Consumer Business | 16.1 | 15.4 | -0.3 |
| Life Sciences & Healthcare | 11 | 11 | 4 |
| Manufacturing | 8.4 | 8.8 | 9.4 |
| Tech & Services | 8.7 | 8.1 | -3.9 |
| Communication & Media | 7 | 6.2 | -7.4 |
| Energy, Resources and utilities | 5.5 | 5.6 | 5.7 |
| Regional Makret & Others | 10.8 | 14 | 37.7 |
| Total | 100 | 100 | 4.4 |
TCS added 5,452 employees in Q1, taking the total workforce to 6.07 lakh. The company's attrition rate stood at 12.1% on last twelve-month (LTM) basis. The employee base stands diverse, with 35.5% women and with 151 nationalities.
The Board of Directors has declared an interim dividend of Rs.10 per equity share of Rs.1 each of the company.
TCS CEO K Krithivasan said that they are continuing to expand 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 delivery centers in Latin America, Canada, and Europe.
Following the result, the stock made positive opening and is currently up 6%. The Nifty IT index is up more than 4%.
