The Q1 FY26 earnings season is underway, and the latest results from two leading Indian IT services companies HCL Technologies and Tech Mahindra reflect the shifting landscape of global IT demand.
With cautious client spending and global macro uncertainties, both firms have reported numbers that provide insight into the current state and near-term direction of the IT sector.
Let’s take a closer look at how the Q1 FY26 numbers compare across key metrics such as revenue, margins, profitability, and deal wins.
| Metric | HCL Technologies | Tech Mahindra |
| Revenue (₹ crore) | 30,349 | 13,351 |
| QoQ Revenue Growth | -0.8% (constant currency) | -0.2% |
| Operating Margin | 19.9% | 14.5% |
| QoQ Margin Change | -150 bps | +50 bps |
| Net Profit (₹ crore) | 3,844 | 1,128 |
| QoQ Net Profit Change | -10.8% | -1% |
| Deal Wins (TCV) | $1.81 billion | $809 million |
| Guidance for FY26 | 3–5% growth (CC) | No specific guidance |
| P/E (FY26 est.) | ~25x | ~32x |
Tech Mahindra reported consolidated revenues of ₹13,351 crore for Q1 FY26, showing a slight decline of 0.2% on a quarter-on-quarter (QoQ) basis.
HCL Technologies reported ₹30,349 crore in revenue, which marks a 0.8% QoQ drop on a constant currency basis. The numbers suggest that revenue growth momentum remains under pressure across the sector, particularly in key export markets.
Tech Mahindra's core operating margin improved by 50 basis points to 14.5% in Q1, primarily due to better cost control, especially on employee-related expenses. HCL Tech, meanwhile, saw its operating margin decline by 150 basis points to 19.9%.
The contrasting trends indicate different approaches to managing internal costs and operational efficiency during a muted demand phase.
Tech Mahindra reported total contract value (TCV) of $809 million for the quarter, slightly up from $798 million in the previous quarter. HCL Tech posted TCV of $1.81 billion, which is a decrease from $2.99 billion reported in the previous quarter. The drop in deal inflow reflects a cautious approach from clients amid global uncertainty.
Net profit for Tech Mahindra stood at ₹1,128 crore, down 1% QoQ. HCL Technologies reported ₹3,844 crore in net profit, registering a 10.8% QoQ decline. The decline in profitability aligns with the pressure on top-line growth and margin compression seen across the IT space.
HCL Tech has revised its FY26 revenue growth forecast to a range of 3–5% year-on-year in constant currency, slightly improving from its earlier 2–5% range. Tech Mahindra has not issued formal guidance for the full year, indicating a more measured approach amid uncertainty in client demand and deal cycles.
Read More: ICICI Bank Share Price in Focus After Q1 FY26 Results as Net Profit Rises 15.5% YoY.
The Q1 FY26 results highlight differing trends in revenue resilience, cost management, and deal momentum between HCL Technologies and Tech Mahindra. As the IT sector navigates macroeconomic headwinds and shifting client priorities, these results offer useful data points for stakeholders evaluating long-term strategies and portfolio positions.
Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.
Investments in the securities market are subject to market risks, read all the related documents carefully before investing.
Published on: Jul 21, 2025, 3:17 PM IST
Neha Dubey
Neha Dubey is a Content Analyst with 3 years of experience in financial journalism, having written for a leading newswire agency and multiple newspapers. At Angel One, she creates daily content on finance and the economy. Neha holds a degree in Economics and a Master’s in Journalism.
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