Earnings Call Transcript Analysis Report #
Financial Performance #
Key Metrics (FY25) #
- Revenue: $30.2 billion (+4.2% YoY in Constant Currency, +3.8% in USD)
- Operating Margin: 24.3% (-30 bps YoY)
- Headwinds: 200 bps (wage increases/promotions), 130 bps (investments)
- Tailwind: 80 bps (currency)
- Net Margin: 19.0%
- EPS Growth: +5.1% YoY
- Total Dividend: ₹126 per share (including proposed final dividend of ₹30)
Key Metrics (Q4 FY25) #
- Revenue: ₹64,479 Cr / $7.47 billion (+2.5% YoY CC, +5.3% YoY INR, +1.4% YoY USD)
- Operating Margin: 24.2% (-30 bps QoQ)
- Headwinds: 100 bps (“tactical interventions” - promotions), 60 bps (marketing/initiatives)
- Tailwind: 40 bps (currency)
- Net Margin: 19.0%
- Total Contract Value (TCV): $12.2 billion (Record Q4)
- North America TCV: $6.8 billion (all-time high)
- BFSI TCV: $4 billion
- CBG TCV: $1.7 billion
- Cash Flow: Net Cash from Operations $1.78 billion (125% of Net Income), Free Cash Flow $1.48 billion
- Days Sales Outstanding (DSO): 71 days (down 3 days QoQ)
Guidance/Forecasts #
- No specific revenue or earnings guidance provided.
- Management expectation: FY26 to be better than FY25, particularly for the international business
- Margin aspiration: “getting closer to 26%”
Growth/Decline Areas (Q4 YoY CC) #
- Growth: Regional Markets (+22.5%), India (+33.0%), ERU (+4.6%), BFSI (+2.5%), Technology & Services (+1.1%), Europe (+1.4%), UK (+1.2%), MEA (+13.2%), LatAm (+4.3%), Asia Pacific (+6.4%).
- Decline: Consumer Business Group (-0.2%), Life Sciences & Healthcare (-5.6%), Manufacturing (-2.9%), Communication & Media (-9.8%), North America (-1.9%).
Client Metrics #
- 64 clients in the $100M+ band (+2 YoY).
Strategic Initiatives & Business Updates #
Major Announcements #
- Surpassed $30 billion annual revenue milestone.
Products/Services/Markets #
- Significant updates and wins across proprietary platforms: ignio™, TCS BaNCS™, BFSI Production Platform, Quartz™, TCS iON™, OmniStore™, Optumera™, TwinX™, TCS ADD™, HOBS™, MasterCraft™/Jile™.
- Strong focus on AI/GenAI integration across services (“AI for IT” and “AI for Business”) and platforms.
- Continued focus on Cloud services (sovereign cloud, cloud FinOps, migration/modernization).
- Emphasis on nation-building transformation projects in growth markets.
- S/4HANA greenfield transformation highlighted.
Operational Changes #
- Workforce size: 607,979 associates
- LTM Attrition: 13.3%
- Increased focus on AI skilling.
- Campus hiring ramping up in FY26.
- Increased proportion of digital skills hires (40%).
- Promotions executed in FY25.
Market & Competitive Landscape #
Industry Trends #
- Clients prioritizing technology modernization, cost optimization, vendor consolidation, operational transformation, risk/compliance.
- Significant adoption of Data & AI for operational efficiency and customer experience.
- Cloud adoption continues.
- Increased focus on cybersecurity.
- Growing propensity to roll out GenAI use cases.
Competitive Positioning #
- Record Q4 TCV ($12.2B).
- Highlighting leadership in analyst rankings.
- Positioning TCS as a partner for “perpetual adaptability.”
- Using AI for IT capabilities to win larger deals.