TCS Q2 Results: TCV To Dividend—Five Key Highlights From India's Top IT Major's Sept Quarter Scorecard

TCS Q2 Results: Tata Consultancy Services (TCS) announced its July-Sept. quarter results for fiscal 2025-25 (Q2FY26) on Thursday, Oct. 9, reporting a drop of 5.4% in consolidated net profit to Rs 12,075 crore, compared to Rs 12,760 crore in the preceding April-June quarter of FY26. The drop in net profit came despite an uptick in the topline growth during the quarter.

“I am pleased with our strong Q2 performance. We are on a journey to become the world’s largest AI-led technology services company," said K Krithivasan, Chief Executive Officer (CEO) and Managing Director, TCS.

"Our journey is anchored in bold transformation across talent, infrastructure, ecosystem partnerships and customer value. The investments, including the building of a world-class AI infrastructure business, demonstrate our commitment to this transformation,” he said.

India's largest information technology (IT) major's revenue from operations in the second quarter of current fiscal rose 3.7% to Rs 65,799 crore, compared to Rs 63,437 crore in the first quarter of FY26. On a year-on-year (YoY) basis, the IT major's topline rose 2.4% compared to Rs 64,259 crore in the corresponding period last year. The bottom line also rose 1.4% YoY.

On the operating front, the core profitability or EBIT (earnings before interest and taxes) of the IT major rose 7% to Rs 16,565 crore compared to Rs 15,514 crore on a sequential basis. EBIT margin expanded 25.2%.

TCS announced a second interim dividend of Rs 11 per equity share for FY25. The dividend will have a face value of Re 1. As per BSE data, TCS had up to 361 crore shares held in total, up to the quarter ended June 2025. Hence, TCS will distribute nearly Rs 3,979 crore to shareholders in the form of dividend payout.

TCS board has fixed Oct. 15 as the record date for the purpose of dividend payment. Additionally, TCS announced that it will pay the interim dividend on Nov. 4. TCS has declared 91 dividends since Oct. 28, 2004. In the past 12 months, barring the latest dividend announced, TCS has declared an equity dividend amounting to Rs 127 per share, resulting in a yield of 4.15%.

TCS announced that its total contract value (TCV) of deals in the Sept. quarter stood at $10 billion, compared to $9.4 billion in the July quarter. The cash flow from operations stands at 110.1% of net income.

Among its key deal wins, TCS expanded strategic partnership with Tryg, a Scandinavian non-life insurance company, as part of a seven-year $647 million agreement. TCS launched a new AI-driven operations center in Mexico City. It also secured a multi-year strategic partnership with a UK-based insurance services provider to transform and manage its digital platforms.

TCS said that among the key business vertical segments, the life sciences and healthcare reported a gain of 3.4% QoQ in constant currency terms. However, on a YoY basis, the segment shrank by 2.2%. The BFSI segment grew by 1.1% QoQ and by 1% YoY in CC terms. Communication and Media segment vertical reported a degrowth of 5.1% YoY. The technology and services segment grew 1.8% on a sequential basis and 2.8% YoY.

The Indian market contracted by 33.3% YoY. However, on a sequential basis, it grew by 4% The Middle East and African market grew by 5.9% QoQ and 12.7% YoY. The North American market reported a mild growth of 0.8% QoQ, but shrank 0.1% YoY in CC terms.

Latin America, grew 0.3% QoQ and 1.8% YoY. In Europe, the UK market shrank by 1.4% QoQ and 1.9% YoY. The continental Europe market reported a growth of 1.4% QoQ in the Sept. quarter but shrank 3% YoY.

Ahead of the announcement of Q2 results, shares of TCS settled 1.14% higher at Rs 3,061.7 apiece on the NSE, compared to a 0.54% rise in the benchmark Nifty 50 index. The IT major's stock has fallen 28.01% in the last 12 months and 24.04% on a year-to-date basis.

Out of the 51 analysts tracking TCS, 32 have a 'buy' rating on the stock, 13 recommend 'hold' and six suggest 'sell', according to Bloomberg data.

TCS has broadly met Bloomberg's earnings estimates in the Sept. quarter. The revenue from operations was estimated at Rs 65,206 crore, while the consolidated profit was expected to hit Rs 12,568 crore, as per analysts.