Bear Cases
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View Bear Cases →Tata Consultancy Services Ltd — Q4 FY25
TCS reported Q4 FY25 revenue of ₹64,479 crore, up 5.3% YoY, with operating margin at 24.2%, contracting 30 bps QoQ due to tactical interventions and elevated expenses.
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TCS reported Q4 FY25 revenue of ₹64,479 crore, up 5.3% YoY, with operating margin at 24.2%, contracting 30 bps QoQ due to tactical interventions and elevated expenses. Net profit stood at ₹12,224 crore. The quarter saw strong order book closure of $12.2 billion (second highest ever, no mega deals), but management noted uncertainty from US tariffs led to project delays and cautious discretionary spending from late February. BFSI and energy verticals grew, while consumer and life sciences declined. CEO Krithivasan guided that FY26 will be better than FY25, contingent on short-lived uncertainty. Risks include prolonged macro uncertainty impacting deal conversions and potential margin pressure from higher bench costs.
टीसीएस ने चौथी तिमाही में 64,479 करोड़ रुपये की कमाई की, जो पिछले साल से 5.3% ज्यादा है। मुनाफा 24.2% रहा, लेकिन पिछली तिमाही से थोड़ा कम हुआ क्योंकि खर्च बढ़ गए। कुल मुनाफा 12,224 करोड़ रुपये रहा। कंपनी को 12.2 अरब डॉलर के नए ऑर्डर मिले, जो दूसरा सबसे बड़ा आंकड़ा है। हालांकि, अमेरिकी टैरिफ की अनिश्चितता के कारण फरवरी से कुछ प्रोजेक्ट्स में देरी हुई और ग्राहकों ने खर्च कम कर दिया। बैंकिंग और एनर्जी सेक्टर में बढ़ोतरी हुई, जबकि कंज्यूमर और लाइफ साइंसेज में गिरावट आई। सीईओ का कहना है कि अगला साल बेहतर होगा, लेकिन यह अनिश्चितता जल्दी खत्म होने पर निर्भर करता है।
Bear Cases3 alive · 0 deadPromises0 met · 2 missedRisks4 trackedTranscriptfull text
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Focused Modules
Promises
2 promises
Promise Tracker
0 delivered, 0 close, 2 missed.
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Risks
4 risks
Risk Intelligence
Prolonged macro uncertainty from US tariffs
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Transcript
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Call Transcript
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Read Transcript →Quarter Snapshot
Order Book (TCV)
$12.2B
Second highest quarterly, no mega deals
Strong order book driven by BFSI ($4B) and North America ($6.8B), indicating robust demand despite macro uncertainty.
Headcount
607,979
+625 QoQ
Net employee addition of 625; attrition at 13.3%, with quarterly annualized attrition down 130 bps.
AI Engagements
580+
Delivered or in-flight in Q4
AI for business engagements driving growth; Agentic AI Farm with 150+ solutions launched.
Customer >$100M
64
+2 YoY
Resilient customer metrics; $1M+ customer base at 1,332, up 38 YoY.
What Changed vs Last Quarter
NEW
FY26 revenue growth expected to be better than FY25
Management believes FY26 will be better than FY25 based on order book and customer discussions, assuming short-lived uncertainty.
NEW
Operating margin target range of 26%-28% remains
CFO reiterated the 26%-28% margin beacon, with levers like pyramid, utilization, and productivity expected to help achieve it, though timeline uncertain.
NEW
Campus hiring of 40,000+ trainees in FY26
CHRO confirmed campus hiring will be similar or slightly higher than FY25's 42,000, with wage hike timing dependent on clarity.
NEW
CapEx to remain elevated at ~₹5,000 crore
CFO stated no plans to scale down investments in talent, innovation, infrastructure, or partnerships despite uncertainty.
DROPPED
Margin aspiration of 26% by Q4 FY25
Management aims to exit Q4 at 26% operating margin, within the 26%-28% aspirational band, driven by operating efficiencies and BSNL tapering.
DROPPED
BSNL revenue to taper from Q4 FY25 through Q2 FY26
The BSNL contract is 70% complete; revenue will start tapering in Q4 and may extend to Q2 FY26. Management expects to replace most of it via other opportunities.
DROPPED
CY25 to be better than CY24 for international business
Management expects stronger growth in CY25 vs CY24, driven by early discretionary recovery and strong deal pipeline, despite BSNL headwinds.
DROPPED
Increased campus hiring next year
Preparations underway to onboard a higher number of campus hires next fiscal year, signaling confidence in future demand.
NEW RISK
Prolonged macro uncertainty from US tariffs
Management noted project delays and cautious discretionary spending from late February; if uncertainty persists, deal conversions and revenue growth could be impacted.
NEW RISK
Margin pressure from higher bench costs
CFO acknowledged that operating leverage may be impacted if utilization drops due to uncertainty, potentially delaying margin recovery to 26%-28%.
NEW RISK
Attrition risk from delayed wage hikes
Analyst raised concern that delaying wage hikes could impact employee morale and attrition; management downplayed but attrition inched up to 13.3%.
RISK GONE
Macro uncertainty from US trade policies
Potential increase in inflation due to trade tariffs or uncertain government policies could dampen discretionary spending recovery.
RISK GONE
North America revenue decline
North America revenue declined 2.3% YoY, and TTH slowed considerably in the US due to market-specific issues and strained client profitability.
RISK GONE
Life sciences and healthcare recovery uncertainty
Life sciences healthcare declined 4.3% YoY; recovery depends on policy clarity in the US, which is uncertain.
🤫 Topics management stopped discussing
Mentioned in Q1 FY24, Q1 FY25, Q3 FY24
CHRO Milind Lakkad indicated that the company aims to hire close to 40,000 trainees in FY25, consistent with historical practice.
Mentioned in Q1 FY24, Q1 FY25, Q3 FY24
North America revenue declined 1.1% YoY and BFSI remained negative YoY, with management citing ongoing client uncertainty and delayed decision-making.
Mentioned in Q2 FY25, Q3 FY25
The BSNL contract tapering from Q4 could create a revenue gap; management is confident of replacement but execution risk remains.
Mentioned in Q2 FY24, Q3 FY24
Headcount declined by 5,600 in Q3. CHRO said further decline would not be surprising, which could signal lower utilization or demand.
Mentioned in Q2 FY25, Q3 FY25
Management aims to exit Q4 at 26% operating margin, within the 26%-28% aspirational band, driven by operating efficiencies and BSNL tapering.
Fast read
Guidance and risk preview
Management believes FY26 will be better than FY25 based on order book and customer discussions, assuming short-lived uncertainty.
Management noted project delays and cautious discretionary spending from late February; if uncertainty persists, deal conversions and revenue growt...
View Risks →