Earnings Review
Tata Tech Apr-Jun sales dn 3% QoQ on weak services revenue
This story was originally published at 18:55 IST on 14 July 2025
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--Tata Tech Apr-Jun consol net profit INR 1.70 bln
--Analysts saw Tata Tech Apr-Jun consol net profit INR 1.5 bln
--Tata Tech Apr-Jun consol net profit INR 1.70 bln vs INR 1.89 bln qtr ago
--Tata Tech Apr-Jun consol revenue INR 12.44 bln vs INR 12.86 bln qtr ago
--Tata Tech Apr-Jun svcs ops sales INR 9.64 bln vs INR 10.24 bln qtr ago
--Tata Tech Apr-Jun tech solutions sales INR 2.81 bln vs INR 2.62 bln qtr ago
--Tata Tech Apr-Jun consol operating EBITDA INR 2 bln, EBITDA margin 16.1%
--Tata Tech last 12-month attrition 13.8% vs 13.2% qtr ago
--Tata Tech headcount 12,407 as on Jun 30 vs 12,644 qtr ago
--Tata Tech Apr-Jun services revenue $112.5 mln
--Tata Tech Apr-Jun consol EBIT INR 1.82 bln vs INR 2.14 bln qtr ago
--Tata Tech Apr-Jun consol EBIT margin 14.6% vs 16.7% qtr ago
--Tata Tech Q1 consol revenue $145.3 mln, down 4.6% QoQ in constant currency
--Tata Tech Apr-Jun svcs sales $112.5 mln, dn 7.6% QoQ in constant currency
--Tata Tech MD: Optimistic about sequential recovery in Jul-Sept
--Tata Tech MD: Q1 began on cautious note, client confidence improved later
By Arya S. Biju
MUMBAI – Engineering and research and development major Tata Technologies Ltd. reported subdued earnings for the June quarter, recording its highest-ever sequential fall in revenue since November 2023, when it was listed in the stock market. The company's top line was dragged down by a mid-single-digit sequential fall in revenue from its largest segment, services, which offset the rise in revenue from its technology solutions business. The company's bottom line fell nearly 10% on quarter, marking the second-highest sequential fall since listing. However, both prints turned out to be not as bad as analysts had feared.
The company's consolidated revenue fell over 3% on quarter and nearly 2% on year to INR 12.44 billion for the reporting quarter. This was the lowest revenue reported by the company since its shares debuted on the stock exchanges. However, this was higher than analysts' expectation of INR 12.13 billion. The company's consolidated net profit for the quarter fell nearly 10% on quarter but rose a little over 5% on year to INR 1.70 billion, beating analysts' expectation of INR 1.53 billion by a wide margin.
The company's revenue from the services segment fell nearly 6% on quarter to INR 9.64 billion, while the revenue from its technology solutions segment rose over 7% to INR 2.81 billion. In dollar terms, the company reported a consolidated revenue of $145.3 million, down over 2% on quarter. Revenue from the services segment fell nearly 5% on quarter to $112.50 million. In constant currency terms, the company's revenue declined nearly 5% on quarter and that from the services segment fell nearly 8%.
The company's total expenses for the reporting quarter fell nearly 1% sequentially to INR 10.80 billion. The employee benefits expenses, which accounts for 58% of the company's total expenses, rose marginally on quarter to INR 6.27 billion. Its finance costs fell nearly 4% sequentially to INR 46.30 million. The company also saw a near 13% sequential fall in outsourcing and consultancy charges to INR 881.10 million. However, its expenses related to purchases of technology solutions rose over 7% on quarter to INR 2.18 billion.
The Tata group company's consolidated operating earnings before interest, tax, depreciation, and amortisation for the June quarter declined over 14% on quarter to a little over INR 2.00 billion, largely in line with the Street's view of INR 2.01 billion. Its consolidated earnings before interest and tax for the quarter was INR 1.82 billion, down 15% sequentially. The company's consolidated operating EBITDA margin for the quarter under review contracted to 16.1% from 18.2% for the March quarter. Its EBIT margin for the June quarter also declined to 14.6% from 16.7% in the previous quarter.
As of Jun. 30, the company had a headcount of 12,407, down from 12,644 as of Mar. 31. Its trailing 12-month attrition rate worsened to 13.8% during the June quarter, from 13.2% in the previous quarter. The company's million-dollar-plus category customer base improved to 32 in the June quarter from 29 in the previous quarter and 28 a year ago.
"While the quarter began on a cautious note, client confidence strengthened steadily as the period progressed, reaffirming long-term commitments to product innovation and digital transformation," Warren Harris, chief executive officer and managing director of the company, said in a post-earnings press release. The company remains optimistic about a sequential recovery in Jul-Sept and a stronger second half of the financial year 2025-26 (Apr-Mar). "Our deal pipeline today is more robust than a year ago, and the early momentum we are seeing provides greater visibility and conviction in improved conversion through the year," Harris said.
The company announced its June quarter earnings after market hours Monday. Shares of the company closed 1.1% higher at INR 716.80 on the National Stock Exchange. End
US$1 = INR 85.98
Edited by Rajeev Pai
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