HCL Tech Q1FY26 Earnings: Revenue Grew Slightly and Profit Slipped Over 3% YoY

On July 15, 2025, HCL share price is in focus as the tech giant released its earnings for the quarter ended June 30, 2025 (Q1FY26). HCLTech reported a consolidated revenue of ₹30,349 crore for Q1 FY26, marking a modest 0.3% increase quarter-on-quarter (QoQ) and a robust 8.2% growth year-on-year (YoY). In constant currency (CC) terms, revenue declined 0.8% QoQ but grew 3.7% YoY. The company’s USD revenue stood at $3,545 million, reflecting a 1.3% QoQ rise and a 5.4% YoY increase. On a trailing twelve-month (LTM) basis, total revenue surpassed $14 billion.

Services revenue in CC terms declined slightly by 0.1% QoQ but registered a 4.5% YoY growth. Digital services continued to be a strong growth driver, with digital revenue increasing 15.2% YoY in CC terms and accounting for 41.6% of total services revenue. HCLSoftware saw a 3.0% YoY dip in CC revenue, though its annual recurring revenue (ARR) grew 1.3% YoY CC to reach $1.06 billion.

HCLTech Profit Slumped in Q1FY26

EBIT for the quarter was ₹4,942 crore, representing 16.3% of revenue, a decline of 9.2% QoQ but a 3.1% YoY improvement. Net income (NI) came in at ₹3,843 crore, or 12.7% of revenue, down 10.8% QoQ and 9.7% YoY. The company’s return on invested capital (ROIC) stood at 38.1% on an LTM basis, up 353 basis points YoY. For the Services segment, ROIC was higher at 45.2%, reflecting a 236 bps YoY increase.

Operating cash flow (OCF) reached $2,571 million, while free cash flow (FCF) was $2,421 million, both on an LTM basis. The FCF to net income ratio remained strong at 121%.

New deal bookings remained healthy, with total contract value (TCV) of $1,812 million during the quarter. The total employee count stood at 223,151, with a net headcount reduction of 269. However, the company continued investing in early talent, adding 1,984 freshers during the quarter. LTM attrition was steady at 12.8%, unchanged from the same quarter last year.

Also Read: TCS Q1 FY26 Results: Revenue and Net Profit Recorded Growth, Declared ₹11 Interim Dividend

HCLTech FY26 Outlook

For FY26, HCLTech has maintained its guidance for constant currency revenue growth in the range of 3.0% to 5.0%. This growth expectation also applies to its Services business. The company expects EBIT margins to be within the 17.0% to 18.0% range, indicating confidence in maintaining profitability despite macroeconomic headwinds.

HCLTech Dividend

HCLTech declared a dividend of ₹12 per share, continuing its unbroken streak of 90 consecutive quarters of dividend payouts. The Record date for the payment of the aforesaid interim dividend will be on July 18, 2025, and will be paid on July 28, 2025.

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