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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
₹59,692 Cr
verified against source
Revenue YoY
7.9%
reported change
EBITDA
₹14,483 Cr
latest reported figure
Source
screener in
record provenance
Actual signal trajectory
Where this quarter sits.
Quarter read
What the record says.
TCS reported Q2 FY24 revenue of INR 59,692 crore (+7.9% YoY) and operating margin of 24.3% (+110 bps QoQ), driven by disciplined execution and cost optimization. Net profit stood at INR 11,342 crore. Deal wins remained strong at $11.2 billion TCV, the third consecutive quarter above $10 billion, including mega deals JLR and BSNL. However, revenue growth was muted due to clients optimizing existing projects and delaying discretionary spending amid macroeconomic uncertainty. BFSI returned to sequential growth, while UK outperformed (+10.7% YoY). Attrition improved to 14.9% (LTM IT). Management maintained the 26%-28% margin guidance but did not provide a timeline. Generative AI engagements crossed 250, and 100,000 associates completed initial AI training. Risk: sustained macro headwinds could delay revenue conversion from the strong order book, keeping growth subdued.
Colored figures show movement against the previous available record.
Guidance to track
- Management reiterated the long-term operating margin range of 26%-28%, with no specific timeline for achievement.
- COO NGS indicated the new normal for quarterly deal wins is around $9-10 billion, up from the earlier $7-9 billion range.
- Management expects to complete the BSNL network rollout within 12 to 18 months from Q2 FY24.
- TCS will continue campus hiring and honor all offers, though onboarding may be delayed by a quarter.
Risks flagged
- Clients are optimizing existing projects and deferring discretionary spending, causing revenue growth to lag behind strong deal wins.
- CFO acknowledged that large deals like JLR and BSNL may have lower margins in early phases, though portfolio-level margins are managed.
- TCS has 250+ employees in Israel; while business continuity plans are in place, escalation could disrupt operations.
- Net headcount fell by over 6,000 QoQ; management attributes it to past hiring, but it could indicate lower demand.
Key quotes
- Our guiding does remain 26%-28%, and with your best wishes, hopefully soon.
- I think it's safe to assume that the planning horizon for all of this, especially in this sector and given what's happening, probably a fortnight.
- If AI delivers that kind of a productivity, I think the demand for consultants will be so high that we'll end up hiring a lot more.
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