TCS Q1 FY26 results takeaways: Revenue in CC terms falls 3.1% YoY, operating margin improves; check other details

TCS announced its Q1FY26 results in post-market hours. The shares closed flat with 0.3% gains ahead of the results and dividend announcement.

Subdued topline

The revenue for the quarter ended June 2025 jumped 1.6% YoY and declined sequentially by a similar percentage point at ₹63,437 crore compared to ₹62,613 crore in the previous year’s similar quarter and ₹64,479 crore in the previous quarter. In constant currency terms, the revenue declined 3.1% YoY.

Better operating margin performance

Despite the subdued topline performance, the company managed to improve its operating margin by 30 bps to 24.5% vs 24.2% in the previous quarter. The margin expansion is largely aided by cost optimisation measures and favourable currency adjustments.

Segmental growth

The company’s key segments, like Banking & Financial Services, consumer business, recorded strong growth amongst other segments as they contributed 32.3% and 15.6% to Q1FY26 revenue as compared to 30.9% and 15.4% in the same period last year. Meanwhile, Life Science & Healthcare, Manufacturing, Communications & Media saw a contraction in revenue contribution for the quarter.

Total contract value

The total contract value for the quarter stood at $9.4 billion as compared to $12.2 billion in the previous quarter. The North America region saw a 2.7% CC decline in revenue contribution from 49.5% in Q1FY25 to 48.7% in Q1FY26.

Headcount

Total workforce stood at 613,069 as on June 30, 2025. IT services’ attrition was at 13.8% for the last twelve months. The total workforce addition for the quarter was at 6,071 YoY.

Management commentary

K Krithivasan, Chief Executive Officer and Managing Director, said “The continued global macro-economic and geo-political uncertainties caused a demand contraction. On the positive side, all the new services grew well. We saw robust deal closures during this quarter. We remain closely connected to our customers to help them navigate the challenges impacting their business, through cost optimization, vendor consolidation and AI-led business transformation”