TCS registers 5% rise in net profit in second quarter of FY25

Tata Consultancy Services (TCS), India’s largest technology services exporter, has reported a 4.9% rise in net profit for the second quarter of FY25 but the performance of the company fell short of market expectations, especially on the profitability front.

TCS reported a net profit of Rs 11,909 crore for the second quarter of FY25 as compared with Rs 11,342 earned in a similar period a year ago. However, when compared to the first quarter of FY25, the company saw a 1.1% dip in net profit.

The revenues for the second quarter of FY25 totalled Rs 64,259 crore—a year-on-year (YoY) growth of 7.6%.

On the performance of the company, TCS CEO K Krithivasan said, “We saw the cautious trends of the last few quarters continue to play out in this quarter as well. Amidst an uncertain geopolitical situation, our biggest vertical, BFSI showed signs of recovery. We also saw a strong performance in our growth markets.”

However, the company’s operating profit margins saw a dip in the second quarter of FY25 at 24.1%, compared with 24.3% recorded a year ago.

TCS CFO Samir Seksaria said, “We made strategic investments this quarter in talent and infrastructure to ensure sustainable growth. Our disciplined execution resulted in superior cash conversion. Our longer-term cost structures remain unchanged, and we remain confident in our ability to continue delivering industry-leading profitable growth.”

In the second quarter, TCS onboarded 5,726 employees, taking the total headcount to 6,12,724. This is the second consecutive quarter that the company has registered a positive net addition to headcount.

TCS Chief HR Officer Milind Lakkad said, “We welcomed 11,000 associates in the first half of the year, and we remain on track for trainee onboarding as planned. We have also commenced the campus hiring process for FY26.”

In terms of segment performance, key verticals like BFSI, consumer business, and life sciences showed flat YoY growth during the second quarter. Only the manufacturing vertical showed 5.3% YoY growth. On the geography front, TCS’ largest market, North America, saw a 2.1% YoY decline in growth.

TCS said it continues to see momentum in AI/Gen AI adoption. Over 600 AI/Gen AI engagements have been deployed successfully in production or are in various stages of development.