HCLTech Q3 Results Preview: Software Seasonality Expected To Lift Margin; FY26 Guidance In Focus

HCLTech Ltd. is expected to report stronger sequential growth in the December quarter, with margins seen expanding on the back of software seasonality, even as wage hikes and restructuring costs weigh on profitability. The company will announce its quarterly results on Monday

Bloomberg estimates point to a 5% quarter-on-quarter rise in revenue and an 8% increase in operating profit.

• Revenue seen 5% higher at Rs 33,262 crore versus Rs 31,820 crore

• EBIT seen 8% higher at Rs 6,020 crore versus 5,562 crore

• EBIT Margin seen at 18.09% versus 17.47%

• Profit seen 11% higher at Rs 4702 crore versus Rs 4244 crore

Analysts will focus on the extent of margin expansion after factoring in the impact of wage hikes and restructuring costs, alongside any changes to FY26 revenue growth guidance and commentary on demand visibility for calendar year 2026.

Here's what analysts are expecting from HCLTech Q3 results:

Jefferies

• Revenue expected to grow 2.9% quarter-on-quarter in constant currency, driven by seasonality in the software business and partly offset by furloughs.

• Services segment expected to grow 1.0% sequentially, while the software segment may see sharp sequential growth.

• EBIT margin may expand by about 60 basis points, supported by high-margin software, offset by two months of wage hike impact and restructuring costs.

• Expects FY26 overall and services revenue growth guidance of 4%–5% and margin guidance of 17%–18% to be maintained.

• Focus areas include FY26 guidance revision, calendar year 2026 budgets, deal wins, discretionary spending, and the impact of the H-1B visa fee hike.

Investec

• Expect 2.4% quarter-on-quarter growth in constant currency and 2.3% growth in US dollar terms.

• Growth driven by the products and platforms business, with services revenue growth of about 1% sequentially.

• Margins expected to improve by around 100 basis points due to software seasonality, partly offset by an estimated 80 basis point impact from wage hikes.

• Expect the lower end of services revenue growth guidance to be raised to 4.5%–5% from 4%–5%. 

UBS

• Margin expected to expand due to strong software performance, though growth investments may cap upside.

• Expects HCLTech to maintain FY26 guidance.

Nuvama

• Expect revenue growth of 2.4% quarter-on-quarter in constant currency and 2.2% growth in US dollar terms, driven by products and platforms growth of about 15% and services growth of around 1%.

• EBIT margin expected to expand by around 110 basis points, aided by software seasonality and partly offset by restructuring expenses and wage hikes.

• Expect FY26 services revenue growth guidance of 4%–5% and margin guidance of 17%–18% to be maintained.