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Informist, Wednesday, Jul. 29, 2026

 

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--Hexaware Tech Apr-Jun consol net profit INR 3.30 bln 
--Analysts saw Hexaware Tech Apr-Jun consol net profit at INR 3.59 bln 
--Hexaware Tech Apr-Jun consol revenue INR 38.45 bln 
--Analysts saw Hexaware Tech Apr-Jun consol revenue at INR 38.20 bln 
--Hexaware Tech Apr-Jun consol PAT INR 3.30 bln vs INR 3.52 bln qtr ago 
--Hexaware Tech Q2 consol revenue INR 38.45 bln vs INR 36.13 bln qtr ago 
--Hexaware Tech Jan-Jun consol PAT INR 6.82 bln vs INR 7.07 bln yr ago 
--Hexaware Tech Jan-Jun consol revenue INR 74.58 bln vs INR 64.69 bln yr ago 
--Hexaware Tech Q2 revenue up 4.4% QoQ in constant currency, up 6.3% YoY 
--Hexaware Tech Apr-Jun EBIT margin 13.6% vs 13.3% qtr ago

 

By Arya S. Biju and Eshitva Prakash

 

MUMBAI – Higher other expenses and employee costs dragged down Hexaware Technologies Ltd.'s bottom line for the June quarter. The company's top line, on other hand, rose sequentially, supported by strong growth in sales across most of its verticals. While the company managed to meet analysts' expectation for its revenue, it failed to meet the Street's view for net profit. The company reduced its revenue growth guidance for the full year on the back of delays in deal ramp-ups and a worsening macroeconomic environment.

 

The digital and technology services company's consolidated net profit for the June quarter declined over 6% sequentially and 13% on year to INR 3.30 billion. This was way below the INR 3.59 billion estimated by the Street. Its consolidated revenue for the quarter grew 6.4% sequentially and 18% on year to INR 38.45 billion, beating analysts' expectation of INR 38.20 billion by a comfortable margin. 

 

In dollar terms, the company's revenue for the reporting quarter was $405.4 million, up 4.4% on quarter and 6.1% on year. In constant currency terms, the company's revenue grew 4.4% sequentially and 6.3% on year. 

 

 

The company reduced its revenue growth guidance for 2026 to 6-7% from 7.6?rlier. "Our pathway to 7.6% has narrowed, especially because of delay in deal ramp and worsening macro," the company said. The 6–7% revenue growth guidance includes a 50-basis-point contribution from Consulting Professionals Services rebadging deal. Meanwhile, the company reiterated its EBIT margin guidance of 13-14% for 2026. 

 

The company had a foreign exchange loss of INR 783 million during the June quarter, which was included under its other income. The company has used INR 94.86 per dollar as its period average rate for the June quarter, compared with INR 92.60 per dollar in the March quarter.  

 

Hexware Tech's total expenses for the June quarter grew over 6% on quarter to INR 33.54 billion. This was primarily driven by a near 6% sequential rise in the company's employee benefits expense to INR 22.66 billion. Its other expenses for the quarter grew nearly 9% sequentially to INR 9.74 billion. 

 

The company's earnings before interest and tax rose over 9% sequentially to INR 5.24 billion. It reported an EBIT margin expansion of 33 basis points sequentially and 352 bps on year to 13.6% for the June quarter. The company had a net cash and cash equivalent position of $176 million as on Jun. 30 and its days sales outstanding were at 78 days, split evenly between billed and unbilled days.

 

SEGMENTS, VERTICALS & GEOGRAPHIES

The company's revenue from its IT services segment rose over 5% on quarter to $346 million. Its revenues from business process services segment were slightly lower at $46 million from $47 million in the trailing quarter. Other segments' revenue rose to $14 million from $12 million.  

 

The company continued to draw most of its revenue from the financial services vertical. In the June quarter, its revenue from the vertical was at $116 million, almost unchanged from the trailing quarter. The vertical's revenue contribution declined to 28.7% from 29.6% in the March quarter. Among other major growth levers, its healthcare and insurance vertical revenue was $94 million, up from $88 million in the March quarter. The vertical contributed to 23.1% of the company's consolidated top line, higher than 22.6% in the trailing quarter.

 

From the Americas, the company got a revenue of $298 million, up 3% on quarter. The region contributed to almost 74% to the company's total revenue. Its revenues from Europe, which contributed to nearly 20% of its consolidated revenue, rose about 6.6% on quarter to $81 million. Asia Pacific revenues rose over 13% to $26 million. 

 

DEALS, OPERATIONAL METRICS

Hexaware Tech saw continued strong deal momentum in the June quarter, with wins across consolidation, outsourcing, and transformation programmes, it said in a post-earnings presentation. It saw increased deal momentum in more than $10 million legacy modernisation programmes. Further, the company also received the first two deals from the new category of deals to select an artificial intelligence partner, in the June quarter. 

 

As of Jun. 30, the company had 34,506 employees, recording a net addition of 708 employees from the March quarter. Its IT services segment had 22,796 employees and half that number of workers were employed in the company's business process services department. The company reported a voluntary attrition rate of 11.2% for its IT services segment, slightly higher than 11.1% in the March quarter. Hexaware's utilisation rate for the segment improved to 84.8% from 82.6% in the trailing quarter.

 

The company reiterated its focus on building AI capability. Hexaware said it continued to launch one new AI service per month and is scaling up existing programmes to infuse AI offerings into all current contracts. Hexaware said it has closed a few deals for its Zero License agentic AI tool and several of these deals are in the pipeline. The company is planning to use AI in its sales process extensively, it said in an investor presentation.

 

The company added one customer in the $20 million and above category during the June quarter, taking total clients in the segment to 16. Meanwhile, revenue contribution from its top 10 customers declined to 35.7% from 35.9% in the trailing quarter. 

 

For the six months ended June, Hexaware Tech reported a consolidated net profit of INR 6.82 billion, down 3.6% on year. Its consolidated revenue for the same period grew over 15% on year to INR 74.58 billion. The company follows the calendar year.

 

The company announced its June quarter earnings after market hours. Wednesday, shares of the company closed 4% higher at INR 618.30 on the National Stock Exchange. End

 

US$1 = INR 95.65

 

Edited by Akul Nishant Akhoury

 

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