Total Contract Value (TCV) of net new bookings
$9.3B
Flat YoY
Full-year TCV matched last year despite AI deflation and voluntary deal walkaways.
HCLTECH
Information Technology
22 Apr 2026
HCL Technologies Ltd — Q4 FY26
HCL Tech reported Q4 FY26 revenue of $3.68B, up 2.4% YoY but down 3.3% QoQ, missing expectations due to delayed procurement decisions and discretionary spending cuts by two large US telecom clients.
✓ Verified against BSE filing
2-Min Summary
HCL Tech reported Q4 FY26 revenue of $3.68B, up 2.4% YoY but down 3.3% QoQ, missing expectations due to delayed procurement decisions and discretionary spending cuts by two large US telecom clients. Services revenue grew 4.2% YoY while software declined 14% YoY. Full-year revenue grew 3.9% in constant currency, with services up 4.8%. EBITDA margin (ex-restructuring) was 17.7%, down 20bps YoY. Management guided FY27 revenue growth of 1-4% (services 1.5-4.5%) and EBIT margin of 17.5-18.5%, reflecting headwinds from two client-specific reductions (~50bps) and continued soft discretionary spend. AI momentum remains strong with $155M quarterly advanced AI revenue (+6.1% QoQ) and a $100M+ AI factory deal. Key risk: further escalation of tariff volatility or client-specific issues could pressure growth.
Key Numbers
Advanced AI annualized revenue
$620M
+30% YoY (implied)
Annualized run-rate after two strong booking quarters; Q4 revenue $155M.
Clients >$100M
1 added
+1 YoY
Organic addition; total >$100M clients now at 24 (implied).
AI Force deployments
75 accounts
+50% YoY (approx)
AI transformation platform deployed across 75 accounts, up from ~50 last year.
Management Guidance
FY27 revenue growth 1-4% CC
Consolidated revenue growth guidance for FY27 in constant currency; services growth 1.5-4.5%.
revenueFY27 EBIT margin 17.5-18.5%
Operating margin guidance for FY27, excluding impact of acquisitions.
marginsTwo clients to cause ~50bps growth headwind in FY27
Specific client reductions in manufacturing and retail will impact growth by about 50 basis points.
growthAI native services to grow 25-30%
Management expects advanced AI services (AI factory, custom silicon) to grow at 25-30% annually.
ai_strategyKey Risks
Telecom discretionary spending cuts may persist
Two large US telecom clients cut discretionary spend in Q4; impact expected to continue through calendar 2026.
high · management_commentaryAI deflation could accelerate beyond 2-3%
Analyst questioned if deflation from AI could expand; management acknowledged risk but maintained 2-3% estimate for HCL.
medium · analyst_questionSoftware revenue volatility from government deals
Q4 software revenue missed due to delayed US government decisions; timing of closures unpredictable.
medium · management_commentaryGeopolitical uncertainty in Europe
Management noted softness in Europe due to geopolitical escalations, which could worsen.
medium · management_commentaryNotable Quotes
We are seeing some of this impact already hurting the growth outlook in Europe. While there are no broad macro challenges in North America, two client specific challenges in Americas would have close to 50 basis points growth headwind in FY27.
40% of the industry runs the risk of being disrupted by AI and can shrink 3 to 5% faster for a few years... For our portfolio it would translate to 2 to 3%.
We have lost some deals which are voluntary losses... we walked away from some deals which will not make sense and that would have easily contributed at least a billion dollar more to this number.