TCS Q4 net profit falls 1.7% to 12,224 crore on US uncertainties

Tata Consultancy Services reported lower than expected net profit of Rs 12, 224 crore in the final quarter of financial year 2025 amid the volatile global tariff war. The decline of 1.68 % year-on-year and 1.26% sequentially was due largely to business uncertainties in its core market of North America as well as from the cautious approach to outsourcing by clients in key sectors such as consumer, life sciences & healthcare, manufacturing, communications and media, the company said.

Mumbai-headquartered TCS marked a milestone posting $ 30.18 billion revenue for the full fiscal year growing by 3.8% and 4.2% in constant currency terms compared to FY24’s revenue of $29.08 billion. The company’s quarterly revenue grew by 0.8% in rupee terms to Rs 64,479 crore.

"In March there were uncertainties, including some around deal closures and delays in decision making. We should be back in the next few months,” TCS CEO and MD K Krithivasan said at a post earnings call on Thursday. He said there were no cancellations in AI deals bagged by the Tata group company.


TCS board also proposed a final dividend of Rs 30 to be approved at the forthcoming annual general meeting.

ET estimated TCS posting a 1.3% QoQ growth in revenue at Rs 64,777.6 crore and 1.6% growth in profit at Rs 12,576.5 crore.

The lower profits announced by India’s largest software exporter come even as the country’s $280 billion IT industry battles increasing macroeconomic upheaval as well as an overdependence on American business, which accounts for nearly half of TCS’s revenue.

Since April 2, when US President Donald Trump imposed wide-ranging tariffs that battered global stock markets, TCS shares have plunged 8.4% fearing the impact despite marginal recovery amid the seesaw in US tariff decisions.

On Wednesday, the stock had closed 1.4% weaker at Rs 3246.10 apiece.

Markets were shut on Thursday.

The TCS chief Krithivasan sounded an optimistic note saying that both the calendar year 2025 and fiscal year 2026 are expected to be better. TCS does not give revenue guidance.

The company recorded its second highest quarterly order book with total contract value (TCV) at $12.2 billion as compared with TCV of $10.2 billion in the previous quarter. Yet it was lower than $13.2 billion in Q4 a year ago.

Analysts pointed to core business sectors such as “financial Services growing ahead of company average at 1.8% QoQ (best since Q2FY23),” noted Manik Taneja, IT analyst at Axis Capital.

TCS’s revenue in India witnessed a dip of 15% QoQ, with pressure from slow completion of its mega BSNL deal now in the last leg of completion.

Delay in wage hikes

Reversing the headcount decline from the previous quarter, TCS added 625 employees during the quarter and 6,433 in the full year to end March headcount at 607,979.

Chief HR officer Milind Lakkad said TCS onboarded 42,000 graduates in FY25, a notch higher than the targeted 40,000 number. “And FY26 number will be similar or little higher.”

The company management also hinted at a delay in the annual wage hike amid the macro environment “considering the uncertain business environment, we will decide within the year when to make that happen”, Lakkad said.

In FY25, order book came in lower at $39.4 billion, from an all-time high of $42.7 billion last year.

Operating margins, a key metric reflecting an IT firm’s efficiency of improving profit after covering operating expenses, came in lower at 24.2% from 24.5% in Q3FY25 and 26.0% in Q4FY24, partly from a rise in sales & marketing expenses. Guidance on margin continued to remain in the 26-28% for the full year 2026.

The company also brought back the chief operating officer position after it remained vacant for nearly a year. TCS appointed former employee Aarthi Subramanian in the role as executive director – president and COO and also Mangesh Sathe as chief strategy officer.