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A source-linked quarter view: reported numbers, management language, guidance, and the risks that should carry forward.
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Revenue
₹29,890 Cr
verified against source
Revenue YoY
4.1%
reported change
EBITDA
Pending
latest reported figure
Source
screener in
record provenance
Actual signal trajectory
Where this quarter sits.
Quarter read
What the record says.
HCL Tech reported a solid Q3 FY25 with constant currency revenue growth of 4.1% YoY and 3.8% QoQ, driven by broad-based demand recovery in technology, financial services, and retail verticals. Services revenue grew 4.9% YoY in CC, while software revenue declined 2.1% YoY due to delayed renewals. EBIT margin improved 93bps QoQ to 19.5%, aided by software margin expansion and forex gains. ACV grew 23% YoY, signaling strong deal momentum despite shorter deal durations. Management guided FY25 revenue growth of 4.5%-5% (including ~50bps from HPE CTG) and maintained EBIT margin guidance of 18%-19%. Q4 is expected to be soft due to a large transformation project completion and planned mega deal rundown. Key risk: potential policy changes in the US could alter client spending priorities.
Colored figures show movement against the previous available record.
Guidance to track
- Includes approximately 50bps contribution from HPE CTG acquisition. Services revenue growth also expected between 4.5%-5% YoY in CC.
- Management maintained EBIT margin guidance for FY25 at 18%-19%.
- Implies a sequential decline or modest growth due to large project completion and planned mega deal rundown.
- Management expects low single-digit growth for the software business on a full-year basis, with some delayed renewals potentially not recovering in Q4.
Risks flagged
- Management noted that significant changes in the global business landscape, including US policy, could alter client spending priorities.
- Delayed renewals and new closures in software may not materialize in Q4, leading to potential revenue shortfall.
- Management indicated that the automotive segment remains challenged, with declines expected for another couple of quarters before recovery.
- An analyst raised concern about potential impact on insurance clients due to California wildfires; management said it's too early to assess.
Key quotes
- Our revenue grew 3.8% sequentially and 4.1% on a year-on-year basis in constant currency. Our operating margins stood at 19.5%.
- On a year-on-year basis, ACV has grown 23%, and sequentially, it has grown 9%.
- The cost of using LLMs or conversational AI models is reducing. It has dropped more than 85% since early 2023, making more use cases viable.
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