TCS Q3 profit slumps 14%; headcount dips by 11k
image for illustrative purpose
Bengaluru: India’s largest IT services company, Tata Consultancy Services (TCS), on Monday posted largely in-line Q3 results, though net profit declined due to a one-time expense arising from the implementation of the new labour code.
For the quarter ended December 2025, TCS reported a net profit of ₹10,657 crore, down 13.9 per cent year-on-year. Revenue rose 5 per cent to Rs67,087 crore from Rs63,973 crore a year ago.
In dollar terms, revenue stood at $7.5 billion, an increase of 0.8 per cent in constant currency terms the previous quarter.
The Tata Group company’s deal pipeline remained robust, with total contract value (TCV) of $9.3 billion for the December quarter.
“The growth momentum we witnessed in Q2FY26 continued in Q3FY26. We remain steadfast in our ambition to become the world’s largest AI-led technology services company, guided by a comprehensive five-pillar strategy. Our AI services now generate $1.8 billion in annualized revenue, reflecting the significant value we provide to clients through targeted investments across the entire AI stack, from Infrastructure to Intelligence,”K Krithivasan, CEO of TCS said.
Operating margin of the company increased by 70 basis points YoY to 25.2 per cent in Q3FY26. On sequential basis, it remained flat.
“We continued to see AI acceleration this quarter.We further strengthened our Salesforce capabilities with Coastal Cloud acquisition, building on our investment in ListEngage.” Aarthi Subramanian, Chief Operating Officer of TCS said.
Among verticals, BFSI grew by 1.6 per cent year-on-year, while life sciences and healthcare posted a growth of 2.2 per cent. The manufacturing vertical grew 1.7 per cent, and Technology & Services also recorded 1.7 per cent over a year ago period.
Geographically, North America posted 1.3 per cent year-on-year growth, while Latin America grew 1.4 per cent during the quarter. The UK, which contributed 16.9 per cent of its total revenue, saw a decline of 3.2 per cent. India grew sequentially but recorded a sharp a 34.3 per cent year-on-year fall.
Total employee count of TCS stood at 582,163 at the end of December quarter, a decline of 11,151 employees from the previous quarter. “We doubled our intake of fresh graduates with higher order skills, rapidly expanding our next-generation talent pool,” Sudeep Kunnumal, Chief HR Officer of TCS said.
