Advanced AI Revenue
$148M
+20% QoQ
Advanced AI revenue grew 19.9% sequentially, driven by Physical AI, agentic AI, and AI Factory programs.
HCLTECH
Information Technology
15 Jan 2026
HCL Technologies Ltd — Q3 FY26
HCLTech delivered a standout Q3 FY26 with revenue of INR 33,872 crore, up 13.3% YoY, crossing a $15 billion annualized revenue milestone.
Financial stats pending filing verification
2-Minute Summary
✦ AI-Generated from Full Transcript
HCLTech delivered a standout Q3 FY26 with revenue of INR 33,872 crore, up 13.3% YoY, crossing a $15 billion annualized revenue milestone. Services revenue grew 5% YoY in constant currency, led by Engineering & R&D Services (10.8% YoY) and HCLSoftware (28.1% QoQ). EBIT margin at 18.6% (excl. labor code impact) improved 111 bps QoQ. Net income was INR 4,795 crore. Management raised full-year services guidance to 4.7%-5.25% CC and overall guidance to 4%-4.5% CC. Key growth drivers include advanced AI revenue of $148 million (up 20% QoQ), strong bookings of $3 billion, and a mega $475 million AI-led deal. Risks include persistent softness in discretionary spending and potential impact from U.S. tariff policies, though management remains confident in capturing emerging AI-related spend.
एचसीएल टेक का तीसरी तिमाही का प्रदर्शन शानदार रहा। कंपनी ने 33,872 करोड़ रुपये का राजस्व कमाया, जो पिछले साल की तुलना में 13.3% ज्यादा है। इससे कंपनी सालाना 15 अरब डॉलर का आंकड़ा पार कर गई। सेवाओं का राजस्व 5% बढ़ा, खासकर इंजीनियरिंग और आरएंडडी सेवाओं में 10.8% और सॉफ्टवेयर में 28.1% की बढ़ोतरी हुई। कंपनी का मुनाफा 18.6% रहा, जो पिछली तिमाही से बेहतर है। शुद्ध आय 4,795 करोड़ रुपये रही। प्रबंधन ने पूरे साल के लिए सेवाओं की वृद्धि दर 4.7%-5.25% और कुल वृद्धि 4%-4.5% रहने का अनुमान बढ़ाया है। कंपनी को एआई से 148 मिलियन डॉलर का राजस्व मिला और 3 अरब डॉलर के नए ऑर्डर मिले। हालांकि, खर्च में कमी और अमेरिकी टैरिफ नीतियों से जोखिम है, लेकिन कंपनी एआई के अवसरों को भुनाने को लेकर आश्वस्त है।
Key Numbers
Net New Bookings
$3B
+20% QoQ
Strong booking momentum with $3 billion in net new bookings this quarter, up from $2.5 billion last quarter.
HCLSoftware ARR
$1.07B
+0.6% YoY
Annual recurring revenue for HCLSoftware stood at $1.07 billion, with growth fueled by data intelligence portfolio.
Attrition Rate (IT Services)
12.4%
-88bps YoY
Attrition continues to decline, dropping 88 basis points year-on-year to 12.4%.
What Changed vs Last Quarter
NEW
Ongoing Labor Code Cost Impact Minimal at 10-20 bps
Management expects minimal ongoing costs from new labor code, estimated at 10-20 basis points impact on margins.
UPDATED
FY26 Services Revenue Growth Guidance Raised to 4.7%-5.25% CC
Full-year services constant currency growth guidance raised to 4.7%-5.25% from previous range, reflecting strong Q3 performance and bookings.
UPDATED
FY26 Overall Revenue Growth Guidance Raised to 4%-4.5% CC
Company-level constant currency growth guidance raised to 4%-4.5% for FY26.
UPDATED
FY26 EBIT Margin Guidance Maintained at 17%-18%
Full-year EBIT margin guidance remains at 17%-18%, inclusive of restructuring costs but excluding one-time labor code impact.
DROPPED
Company-level revenue guidance maintained at 3-5% CC
Overall company guidance unchanged due to softness in software segment.
DROPPED
Restructuring costs may be slightly higher than 40 bps for full year
Restructuring impact of 55 bps in Q2; full-year impact may exceed the earlier estimate of 40 bps, continuing into Q3 and possibly Q4.
NEW RISK
Persistent Softness in Discretionary Spending
Traditional discretionary spending remains soft, and management is not expecting a rebound to pre-COVID levels, focusing instead on emerging AI-related spend.
NEW RISK
U.S. Tariff and Geopolitical Uncertainty
Potential impact from U.S. tariff threats (e.g., 500% tariff) and geopolitical tensions could affect the services sector. Management declined to comment, indicating uncertainty.
NEW RISK
Life Sciences & Healthcare Vertical Weakness
Life Sciences and healthcare vertical continues to show weakness due to U.S. healthcare sector pressure, with management expecting stabilization in a couple of quarters.
NEW RISK
GCC Expansion Impacting Outsourcing
Rise of Global Capability Centers (GCCs) in India may structurally change outsourcing opportunities, though management sees it as a net opportunity.
RISK GONE
Restructuring costs may exceed earlier estimates
Restructuring impact of 55 bps in Q2, with full-year impact potentially higher than the 40 bps guided last quarter, continuing into Q3 and Q4.
RISK GONE
Auto sector slowdown continues to impact manufacturing
Management noted continued softness in the auto segment, which is affecting the broader manufacturing vertical.
RISK GONE
Potential layoffs from restructuring not fully quantified
When pressed by an analyst, management acknowledged some employee reductions due to skill-location mismatch, but did not provide specific numbers, raising transparency concerns.
RISK GONE
U.S. revenue mix declined YoY despite overall growth
U.S. revenue as a percentage of total revenue declined 2% YoY, though management attributed it to CTG revenue mix shift; underlying demand uncertainty remains.
Management Guidance
FY26 Services Revenue Growth Guidance Raised to 4.7%-5.25% CC
Full-year services constant currency growth guidance raised to 4.7%-5.25% from previous range, reflecting strong Q3 performance and bookings.
Management guidance revenueFY26 Overall Revenue Growth Guidance Raised to 4%-4.5% CC
Company-level constant currency growth guidance raised to 4%-4.5% for FY26.
Management guidance revenueFY26 EBIT Margin Guidance Maintained at 17%-18%
Full-year EBIT margin guidance remains at 17%-18%, inclusive of restructuring costs but excluding one-time labor code impact.
Management guidance marginsOngoing Labor Code Cost Impact Minimal at 10-20 bps
Management expects minimal ongoing costs from new labor code, estimated at 10-20 basis points impact on margins.
Management guidance marginsKey Risks
Persistent Softness in Discretionary Spending
Traditional discretionary spending remains soft, and management is not expecting a rebound to pre-COVID levels, focusing instead on emerging AI-related spend.
medium · management_commentaryU.S. Tariff and Geopolitical Uncertainty
Potential impact from U.S. tariff threats (e.g., 500% tariff) and geopolitical tensions could affect the services sector. Management declined to comment, indicating uncertainty.
high · analyst_questionLife Sciences & Healthcare Vertical Weakness
Life Sciences and healthcare vertical continues to show weakness due to U.S. healthcare sector pressure, with management expecting stabilization in a couple of quarters.
medium · analyst_questionGCC Expansion Impacting Outsourcing
Rise of Global Capability Centers (GCCs) in India may structurally change outsourcing opportunities, though management sees it as a net opportunity.
low · analyst_questionNotable Quotes
We delivered $3.79 billion of revenue this quarter, which helped us cross a very important milestone of annualized revenue of $15 billion.
Our advanced AI revenue grew 19.9% sequentially, led by a strong uptick in agentic Physical AI and AI Factory programs.
I believe there is little value in waiting for either historical or anticipated discretionary spending to resume. Instead, the focus should be on opportunity, identifying proactively where the spending is occurring and targeting those opportunities.
Frequently Asked Questions
What was HCLTech's revenue in Q3 FY26?
HCLTech reported revenue of ₹33,872 Cr in Q3 FY26, representing a +13.3% change compared to the same quarter last year.
What guidance did HCLTech management give for FY27?
FY26 Services Revenue Growth Guidance Raised to 4.7%-5.25% CC: Full-year services constant currency growth guidance raised to 4.7%-5.25% from previous range, reflecting strong Q3 performance and bookings. FY26 Overall Revenue Growth Guidance Raised to 4%-4.5% CC: Company-level constant currency growth guidance raised to 4%-4.5% for FY26. FY26 EBIT Margin Guidance Maintained at 17%-18%: Full-year EBIT margin guidance remains at 17%-18%, inclusive of restructuring costs but excluding one-time labor code impact. Ongoing Labor Code Cost Impact Minimal at 10-20 bps: Management expects minimal ongoing costs from new labor code, estimated at 10-20 basis points impact on margins.
What are the key risks for HCLTech in FY27?
Key risks include Persistent Softness in Discretionary Spending — Traditional discretionary spending remains soft, and management is not expecting a rebound to pre-COVID levels, focusing instead on emerging AI-related spend.; U.S. Tariff and Geopolitical Uncertainty — Potential impact from U.S. tariff threats (e.g., 500% tariff) and geopolitical tensions could affect the services sector. Management declined to comment, indicating uncertainty.; Life Sciences & Healthcare Vertical Weakness — Life Sciences and healthcare vertical continues to show weakness due to U.S. healthcare sector pressure, with management expecting stabilization in a couple of quarters.; GCC Expansion Impacting Outsourcing — Rise of Global Capability Centers (GCCs) in India may structurally change outsourcing opportunities, though management sees it as a net opportunity..
Did HCLTech meet its previous quarter's guidance?
Of 4 tracked promises, management 0 met, 0 close, 4 missed.
Where can I read the full HCLTech Q3 FY26 concall transcript?
The full earnings conference call transcript or source release is available on the linked source material. This page provides an AI-generated summary with filing verification status shown on the financial stats.