Tata Technologies April-June Revenue And Profit Fall On Weak Services Business

Tata Technologies Ltd. posted a decline in revenue and profit for the April-June quarter as weak performance in its key services segment weighed on overall earnings. The company reported its sharpest sequential drop in revenue since its market debut in November 2023, while net profit also saw its second-biggest fall since listing.

Consolidated revenue fell 3.1% on quarter and 1.7% on year to ₹12.44 billion in the June quarter. This was the company’s lowest quarterly revenue since listing. The sequential decline was mainly due to a 5.8% drop in services revenue to ₹9.64 billion, which offset a 7.2% rise in the technology solutions segment to ₹2.81 billion.

Net profit for the quarter declined 9.7% on quarter to ₹1.70 billion, though it was up 5.2% on year. In dollar terms, consolidated revenue fell 2.2% to $145.3 million, while services revenue dropped 4.9% to $112.5 million. On a constant currency basis, overall revenue declined 4.6%, and services revenue slipped 7.7%.

The company’s total expenses declined marginally by 0.9% on quarter to ₹10.80 billion. Employee benefit costs rose 0.3% to ₹6.27 billion, accounting for 58% of total expenses. Finance costs dipped 3.6% to ₹46.3 million, while outsourcing and consultancy charges fell 12.8% to ₹881.1 million. However, the cost of technology solution purchases increased 7.3% to ₹2.18 billion.

Operating earnings before interest, tax, depreciation, and amortisation (EBITDA) dropped 14.4% to ₹2.00 billion, while EBIT fell 15.1% to ₹1.82 billion. The consolidated EBITDA margin narrowed to 16.1% from 18.2% in the previous quarter, and the EBIT margin fell to 14.6% from 16.7%.

As of June 30, Tata Technologies had 12,407 employees, down from 12,644 at the end of March. The trailing 12-month attrition rate rose to 13.8% from 13.2%. The number of clients contributing over $1 million in revenue rose to 32, from 29 in the previous quarter and 28 a year earlier.

Chief Executive Officer and Managing Director Warren Harris said client sentiment improved through the quarter, with continued focus on product innovation and digital transformation. He expressed optimism about a sequential recovery in the current quarter and a stronger performance in the second half of 2025-26, backed by a healthy deal pipeline.