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Informist, Friday, Oct. 17, 2025

By Arya S. Biju

MUMBAI – Engineering and research and development major Tata Technologies Ltd.'s bottom line for the September quarter saw a low-single digit sequential fall as the company's expenses grew at a faster pace over revenue. This sequential fall in bottom line was despite the company's revenue rising sequentially at its fastest pace since it listed in November 2023. The company's top line for the quarter was supported by strong growth across both services and technology solutions segments. 

The company's consolidated net profit for the September quarter fell nearly 3% on quarter to INR 1.66 bilion, beating analysts' estimate of INR 1.63 billion. Its consolidated net sales for the quarter rose over 6% on quarter to INR 13.23 billion, beating the Street's view of INR 12.78 billion by a wide margin. On a year-on-year basis, the company's bottom line grew over 5% and sales grew a little over 2%. 

For the reporting quarter, the Tata group company reported a revenue of $150.9 million, up around 4% on quarter but down over 2% on year. In constant currency terms, the company's revenue grew 4.5% on quarter and fell nearly 2% on year. This was better than the 1.0-1.5% sequential rise in the company's net sales in constant currency terms estimated by the Street.   

"Q2 FY26 was a quarter of strong progress and positive momentum. We achieved a return to growth, upheld margin discipline, strengthened our strategic position in Europe, advanced our innovation agenda, and continued to invest in talent and partnerships that fuel long-term value creation," Chief Executive Officer and Managing Director of the company Warren Harris said in a press release. The company expects to see some short-term "tactical" challenges in the December quarter but remains confident of a rebound in the March quarter supported by a robust pipeline, improving demand, and continued operational excellence, Harris said. 

The company's total expenses for the reporting quarter rose nearly 7% on quarter and over 5% on year to INR 11.51 billion. This was mainly on the back of a near 4% sequential rise in the company's employee benefits expense to INR 6.50 billion and an over 11% rise in costs related to the purchase of technology solutions to INR 2.43 billion. Both the expenses together accounted for nearly 78% of the company's total expenses for the latest quarter. Other expenses rose nearly 17% on quarter to INR 1.29 billion. 

The consolidated revenue from the company's largest segment, services, rose over 5% on quarter to INR 10.13 billion for the September quarter. In dollar terms, revenue from the segment grew nearly 3% on quarter to $115.6 million. In constant currency terms, revenue from the segment grew 3% on quarter but fell nearly 4% on year. Its technology solutions segment reported a consolidated revenue of INR 3.11 billion, up nearly 11% on quarter and around 7% on year.

The company's operating earnings before interest, tax, depreciation, and amortisation for the latest quarter rose nearly 4% on quarter but fell around 12% on year to INR 2.08 billion, beating analysts' expectation of INR 1.96 billion. Its adjusted EBITDA margin for the quarter improved 30 basis points sequentially to 16.4%. The company's consolidated EBIT margin contracted to 14.4% from 14.6% in the trailing quarter. "Q2 FY26 marked a quarter of financial resilience and operational discipline. Our margin performance remained stable despite ongoing macroeconomic challenges," Chief Financial Officer of the company Savitha Balachandran said in the press release.

Tata Technologies's employee headcount declined to 12,402 as of Sept. 30, down from 12,407 in the previous quarter and 12,680 in the year-ago quarter. Its trailing 12-month voluntary attrition rate worsened further to 15.1% from 13.8% in the previous quarter. The company's million-dollar-plus category customer base improved to 33 in the September quarter from 32 in the previous quarter and 30 a year ago.

Tata Technologies announced its September quarter earnings after market hours Friday. Ahead of the earnings, its shares closed 1% lower at INR 685.20 on the National Stock Exchange.  End

Edited by Akul Nishant Akhoury

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