What's Driving Growth For TCS? Innovations in the auto, aerospace sectors and medtech industry has helped TCS secure a good number of large deals in the third quarter of FY25 and demands continue to grow in these areas
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Continuous investments in upskilling, Artificial Intelligence (AI), Generative AI innovations, Cloud services and different partnerships has led to a promising third quarter of FY2025 for TCS. Demand drivers for customer priorities remain centered around cost optimization and business transformation.
The IT major reported a 12 per cent year-on-year rise in consolidated net profit for the December quarter, reaching INR 12,380 crore. Its revenue for the quarter stood at INR 63,973 crore, marking a 5.6 per cent YoY increase (4.5 per cent in constant currency). The operating margin was 24.5 per cent, reflecting a YoY decline of 50 basis points but a sequential improvement of 40 basis points. The net margin for the quarter was 19.4 per cent.
"We are pleased with the excellent TCV performance in Q3 which was well-rounded across industries, geographies and service lines lending good visibility to long-term growth. BFSI and CBG returning to growth, continued stellar run of Regional Markets and early signs of revival in discretionary spend in some verticals give us confidence for the future," said K Krithivasan, chief executive officer (CEO) and managing director (MD).
On January 10th, TCS rallied 5.91 per cent after the company reported a 3.95 per cent increase in consolidated net profit to INR 12,380 crore in Q3 FY25 as compared with INR 11,909 crore in Q2 FY25. Revenue from operations fell 0.45 per cent QoQ to INR 63,973 crore during the quarter, according to ICICI Direct.
"In a quarter that saw significant cross-currency volatility, TCS's strong execution, cost management and deft currency risk management helped deliver healthy margin improvement and free cash flows. Disciplined investments in talent and infrastructure should lend good support to long-term business growth," said Samir Seksaria, chief financial officer (CFO), TCS.
Strategic investments in talent, global delivery centres, pace ports and partnerships give TCS the opportunity for long-term sustainable growth. The medtech industry is undergoing rapid shifts with intelligent devices, predictive AI, and GenAI in genomics and cell therapy. TCS is well-positioned to capitalize on opportunities in this segment. In the auto and aerospace sectors, TCS secured a good number of large deals this quarter and anticipates continuous demand.
