In dollar terms, revenue came in at $1.66 billion, compared with the CNBC-TV18 poll estimate of $1.64 billion, reflecting 2.2% sequential growth in reported terms. Constant currency revenue grew 2.6% quarter-on-quarter, significantly ahead of the CNBC-TV18 poll estimate of 1% growth.
By Gareema Bangad
Tech Mahindra Ltd. reported a June quarter profit that missed Street estimates, aided by strong sequential growth and margin expansion. The IT services company also reported deal wins exceeding the $1 billion mark for the third consecutive quarter.
Constant currency revenue grew 2.6% quarter-on-quarter, significantly ahead of the CNBC-TV18 poll estimate of 1% growth. In dollar terms, revenue came in at $1.66 billion, compared with the CNBC-TV18 poll estimate of $1.64 billion, reflecting 2.2% sequential growth in reported terms.
The company's consolidated net profit for the quarter stood at ₹1,486.3 crore, below the CNBC-TV18 poll estimate of ₹1,694 crore, but up 9.8% sequentially from ₹1,354 crore. Revenue rose 4.2% quarter-on-quarter to ₹15,711.9 crore, ahead of the CNBC-TV18 poll estimate of ₹15,486 crore.
Earnings before interest and tax (EBIT) rose 8.6% sequentially to ₹2,264 crore, exceeding the CNBC-TV18 poll estimate of ₹2,211 crore. EBIT margin expanded 60 basis points sequentially to 14.4%, marginally ahead of the Street estimate of 14.3% and up from 13.8% in the previous quarter.
The June quarter also marked the company's fourth straight quarter of margin expansion, with EBIT margin improving to 14.4% from 13.8% in the March quarter and 11.1% a year earlier.
The company reported new deal wins worth $1.078 billion during the quarter, up 33.3% year-on-year, marking the third consecutive quarter in which deal wins exceeded the $1 billion mark.
Europe emerged as the standout geography, with revenue rising 8.1% sequentially and 12.1% year-on-year, aided by the ramp-up of the Telefónica deal. Europe accounted for 27.5% of the company's revenue mix during the quarter.
Among verticals, manufacturing led growth with revenue rising 9% sequentially and 17.2% year-on-year, while the BFSI segment grew 2.7% quarter-on-quarter. The communications vertical, which remained the company's largest business at 32.3% of revenue, declined 1.3% sequentially but was up 1.3% from a year ago.
Chief Executive Officer and Managing Director Mohit Joshi said the company's year-on-year growth and sustained deal wins underscore the resilience of its business, adding that the number of clients contributing more than $50 million in annual revenue increased by seven during the quarter.
Among operational metrics, Tech Mahindra's IT attrition eased to 11.8% from 12.1% in the March quarter, while total headcount declined by 863 employees sequentially to 146,760. The company ended the quarter with ₹9,695 crore in cash and cash equivalents.
Shares of the company ended 1.13% higher at ₹1,515.60 ahead of the Q1 results announcement on Thursday. The stock has gained nearly 5% over the last month, while declining more than 9% in the last six months.