HCL Technologies Limited has informed the Exchange about Transcript
HCLTECH · price
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HCLTech has filed the transcript of its Q1 FY26 earnings call held on July 14, 2025. Revenue grew 3.7% year-on-year in constant currency to $3,545 million, taking LTM revenue past the $14 billion mark, while declining 0.8% sequentially. Operating margin came in below plan at 16.3% due to lower utilization, a one-off client bankruptcy, and pulled-forward investments in Generative AI and go-to-market capabilities. Management raised the FY26 revenue growth guidance to 3-5% in constant currency but lowered the EBIT margin guidance to 17-18% from the earlier 18-19% band, citing one-off Q1 impacts, ongoing utilization challenges, and planned restructuring costs. Net new bookings stood at $1.8 billion for the quarter, with two large deals deferred from Q1 to Q2 expected to lift TCV next quarter, and the Board declared an interim dividend of Rs. 12 per share.
Near-term: Mixed picture, with strong revenue momentum, a healthy deal pipeline, and solid cash returns (95.8% payout ratio) offset by margin pressure and a downward revision of FY26 EBIT guidance to 17-18%. Longer-term: Management reaffirmed 19-20% as the structural margin band, with normalization expected in FY27 as utilization improves and AI-led investments pay off.