HCLTech Q2 FY25 Results: Noida-based IT consulting firm beats analysts' expectations with Rs 4,235 crore profit, tweaks revenue guidance

HCLTech Q2 FY25 Results: Noida-headquartered HCLTech on Monday reported a consolidated net profit of Rs 4,235 crore for the July-September period, marking a sequential decline of 0.5 per cent and exceeding analysts' expectations. The IT consulting firm staged a strong performance on all fronts, with increasing profitability and a hike in the lower end of its FY25 revenue growth guidance. 

The IT consulting firm registered revenue of Rs 28,862 crore for the second quarter of the current financial year, up 2.9 per cent over the April-June period, according to a regulatory filing. 

Both top-line and bottom-line were better than analysts' expectations. 

According to Zee Business research, HCL Tech was estimated to register a consolidated net profit of Rs 4,000 crore over revenue of Rs 28,450 crore or $3,395 million for the September quarter. 

The software exporter said its revenue in constant currency (CC) terms increased 1.6 per cent sequentially while dollar revenue expanded 2.4 per cent to $3,445 million.

Revenue from HCLTech's core IT and business services unit, contributing 74.6 per cent to its total revenue, increased 3.1 per cent sequentially to Rs 21,544 crore, and from engineering and R&D services grew 2.0 per cent to Rs 4,545 crore. Revenue from HCL software increased 2.8 per cent to Rs 2,773 crore, according to the company.

The Noida-based firm said its earnings before interest and taxes (EBIT) margin—a key measure of profitability—stood at 18.6 per cent for the September quarter. 

Zee Business analysts had pegged the IT firm's September-quarter margin at 17.6 per cent.

HCLTech Q2 Results | Management Commentary

“We delivered a strong quarter... This growth was well distributed across verticals, geographies, and offerings. HCL Software has delivered a stellar performance of 9.4 per cent YoY this quarter and 6.4 per cent growth in H1 FY25 in constant currency, demonstrating the increasing relevance of our products for the digital economy," said C Vijayakumar, CEO and Managing Director, HCLTech. 

"Our pipeline is very strong, including Data & AI, Digital Engineering, SAP migration and efficiency-led programs," Vijayakumar added.

HCLTech Dividend

HCLTech declared a dividend of Rs 12 per share—its 87th consecutive quarter of dividend payouts. Read more on HCLTech dividend

HCLTech Attrition

Attrition at the company, on a trailing 12-month basis, came in at 12.9 per cent in the quarter ended September 30, 2024, as against 12.8 per cent three months ago. 

HCLTech FY25 Guidance 

HCLTech said it expects services revenue growth to range between 3.5 per cent and 5.0 per cent in constant currency terms on a year-on-year basis for the financial year. Earlier, it expected revenue growth for the year to be between 3.0 per cent and 5.0 per cent. 

The company expects its EBIT margin to be between 18.0 per cent and 19.0 per cent for the year. 

HCLTech is an IT consulting firm.

Last week, HCL Tech's larger rival Tata Consultancy Services (TCS) kicked off the earnings season on a muted note, with a 1.1 per cent quarter-on-quarter decline in its July-September net profit that fell short of analysts' expectations. Read more on TCS Q2 FY25 earnings

Earlier on Monday, HCLTech shares ended higher by Rs 16.5, or 0.9 per cent, at Rs 1,856 apiece on BSE. 

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