Tata Consultancy Services Ltd. reported a mixed performance in the first quarter of fiscal 2027, with revenue growth broadly meeting expectations even as wage hikes weighed on profit and operating margins.
The IT major's revenue rose 2.23% sequentially to Rs 72,275 crore, while net profit fell 2.68% to Rs 13,349 crore. Operating performance also came under pressure during the quarter. EBIT declined 3.09% quarter-on-quarter to Rs 17,317 crore, while the EBIT margin contracted 132 basis points to 23.95%. The margin decline was largely attributed to wage hikes, which were among the strongest since fiscal 2023.
Here's a snapshot of the IT behemoth's quarter gone by in six simple charts.
Growth across business segments remained uneven. Regional Markets and Others led the pack with 4% sequential growth in constant currency terms, followed by Technology and Services at 1.7% and BFSI at 1.6%. Consumer Business was the weakest segment, declining 4%, while Life Sciences and Healthcare fell 1%.
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The geographical split showed an even sharper divergence. India led growth with a 7.6% sequential increase in constant currency terms, significantly outperforming other markets. Asia Pacific grew 1.4%, while North America and Continental Europe declined 0.4% and 0.2%, respectively. The Middle East and Africa recorded the steepest fall at 1.8%.
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Artificial intelligence continued to emerge as a key growth engine. TCS' annualised AI revenue rose to $2.6 billion in Q1 FY27 from $2.3 billion in the previous quarter and $1.5 billion at its analyst day in December 2025. That marks a more than 73% increase in roughly six months. AI now accounts for about 8.5% of the company's annualised revenue.
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Deal wins remained strong at $9.5 billion, though slightly below the $10 billion estimate. Meanwhile, TCS added a net 9,279 employees during the quarter, its highest headcount addition in 15 quarters.
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Brokerages remain divided on the road ahead. Axis Capital and Goldman Sachs retained their Buy ratings, while Jefferies maintained Underperform and Citi retained Sell, leaving target prices ranging from Rs 1,800 to Rs 2,500.
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