TCS Q2 results: Profit rises 15% YoY to Rs 13,884 crore; co declares dividend at Rs 12 per share

IT services major Tata Consultancy Services (TCS) on Thursday reported 15% year-on-year (YoY) growth in its consolidated net profit at Rs 13,884 crore for the second quarter of FY27. The same stood at Rs 12,075 crore a year ago. The company's board has declared a second interim dividend of Rs 12 per share for the financial year 2026-27.

Revenue from operations in the reporting period increased 11% YoY to Rs 73,188 crore, compared with Rs 65,799 crore in the last year period.

In constant currency terms, revenue rose 0.5% quarter-on-quarter. Operating margin came in at 24%, while net margin stood at 19%.


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CEO and MD K Krithivasan said the company saw broad-based growth across international markets and most industry segments. He said the Porsche and Best Buy deals represent a new category of transformation partnerships and that TCS is building repeatable platforms with clients to industrialise AI at scale.

AI commentary

TCS said annualised AI revenue reached $3.1 billion in Q2 and crossed 10% of revenue. Aarthi Subramanian, Executive Director, President and Chief Operating Officer, said AI momentum remained strong, with demand coming from AI-native solutions, AI-led enterprise transformation, autonomous global business services and cybersecurity.

Deal Wins

The company’s total contract value stood at $9.6 billion for the quarter, giving visibility in a weak IT demand environment. Strategic wins included a five-year partnership with Porsche AG and the proposed acquisition of MHP, Porsche’s Germany-based management and IT consulting subsidiary. TCS also announced an agreement to transition Best Buy’s Global Capability Center in India to TCS and transform it into an AI Capability Center.

Segment-wise performance

Among verticals, BFSI remained the largest business and grew 2.5% sequentially in constant currency. Manufacturing and Technology & Services grew 3.1% each. Consumer Business declined 0.7%, while Energy, Resources and Utilities fell 0.5%. Regional Markets and Others saw a sharper 5.8% decline. On a year-on-year basis, Technology & Services grew 4.8%, Manufacturing 4.2% and BFSI 3.9%.

The result comes at a time when Indian IT stocks have been under pressure because of weak discretionary spending, cautious client budgets and concerns over the impact of artificial intelligence on traditional services revenue. For TCS, the September quarter was less about a sharp growth rebound and more about showing that large deals, AI-led work and international demand are holding up.

Geographically, the UK was the strongest large market, growing 3.5% sequentially in constant currency. Asia Pacific grew 2%, Latin America rose 4.3%, while North America and Continental Europe grew only 0.4% each. India revenue fell 10.3% sequentially, though it was still up 6% from a year earlier.

TCS also highlighted multiple client wins during the quarter, including Honeywell Technologies for SAP S/4HANA transformation, Aareal Bank for infrastructure and cloud services, and Vodafone Business for technology modernisation. The company also launched AI-focused facilities, including an Industrial Autonomy and Engineering Lab in Pune and an Autonomous Engineering Lab powered by NVIDIA in Bengaluru.

The workforce stood at 598,056 employees, with last-twelve-month attrition in IT services stable at 13.3%. Chief HR Officer Sudeep Kunnumal said learning hours rose 17% sequentially to 17.1 million as the company continued investing in future-ready skills.

Cash generation remained strong. Net cash from operations stood at Rs 14,190 crore, or 102.2% of net income. CFO Samir Seksaria said TCS maintained strong cash conversion and “industry-leading profitability” while investing in acquisitions, partnerships and niche talent.