Tata Consultancy Services (TCS) reported a 3.9 per cent increase in revenue in the period ended June 30, on a trailing quarter basis, and a net profit of Rs 9,008 crore but both numbers fell far short of the Street’s estimates despite a strong performance by all verticals in its core markets.
‘‘We did not anticipate the viciousness of the Covid second wave in India,’’ Rajesh Gopinathan, managing director and chief executive officer at TCS, said in a post-earnings videoconference.
‘‘We lost Rs 350 crore in revenue due to the impact of Covid during the quarter. We have seen some stabilisation and recovery by the end of June. If the Covid situation continues to improve in India, there is no doubt we will bounce back in Q2,’’ he said.
Net profits for the quarter ended June 2021 came in at Rs 9,008 crore against Rs 7,008 crore in the same period of the previous year. Analysts were expecting the company to report net profits in the range of Rs 9,200-9,500 crore.
The revenue in dollar terms stood at $6,154 million. In rupee terms, TCS reported
a revenue of Rs 45,411 crore against Rs 38,322 crore in the year-ago period.
Gopinathan said the company was confident of achieving double-digit revenue growth during this fiscal.
The lifesciences and healthcare vertical led the show showing a sequential rise of 7.3 per cent and a year-on-year growth of 25.4 per cent.
In terms of geographies, growth was led by North America at almost 16 per cent, followed by the UK at 16.3 per cent over the year-ago period, even as continental Europe saw a rise of 19.7 per cent.
In India, the company reported a 14 per cent fall in revenue in sequential terms.
Margins at TCS also softened because of the salary hikes in April. The operating margins came down to 25.5 per cent from 26.8 per cent in the preceding three months.
TCS also reported its highest ever quarterly net headcount addition of 20,409, taking its workforce to 509,058.
Another positive highlight was the strong TCV (total contract value) of $8.1 billion during the period.
