India’s TCS beats quarterly revenue estimate on AI-led demand
- “AI services now generate $1.8 billion in annualized revenue,” TCS said
BENGALURU: Tata Consultancy Services, India’s largest software services firm, posted a bigger-than-expected third-quarter revenue on Monday as artificial intelligence-led demand ramped up.
The company’s consolidated revenue increased 4.9% to 670.87 billion rupees ($7.44 billion) in the third-quarter ended December 31, surpassing analysts’ expectation of 666.76 billion rupees, as per data compiled by LSEG.
AI-led tech spending drove growth for the Tata-group firm in a seasonally weak quarter in which clients typically scale down operations during the year-end.
At its investor day presentation last month, TCS announced that its AI business accounted for $1.5 billion on an annualized basis - accounting for around 5% of annual revenue.
“AI services now generate $1.8 billion in annualized revenue,” TCS said in its statement.
The Mumbai-based firm’s quarterly net profit fell 14% to 106.57 billion rupees, which the company attributed to restructuring costs associated with layoffs announced in 2025.
Net profit came in below analysts’ expectations of 130.24 billion rupees.
The company’s total order book stood at $9.3 billion in the quarter, down from $10 billion in the previous quarter and a record $10.2 billion in the year-ago period. The firm had announced eight deals in the reporting quarter - the most among India’s top-five IT firms - including deals with British food retailer Morrisons and Danish telecom operator Telenor.
The Tata Group firm is the first major Indian IT firm to report numbers in the current earnings cycle. Smaller rivals HCLTech will post figures later in the day.
TCS’ Mumbai-listed shares closed 1.3% higher ahead of the results.
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