HCLTech Q1 FY26: Reports 10.8% QoQ net profit decline at Rs. 3,843 Cr

HCLTech has announced its financial results for the first quarter of fiscal year 2026 (Q1 FY26), ending 30 June 2025, showcasing strategic advancements in client relationships and a strong focus on emerging technologies like Artificial Intelligence (AI) and Generative AI (GenAI). While the quarter saw a dip in net income, the company demonstrated resilience through robust deal wins and a stable client base.

Financial snapshot: A mixed bag

For the quarter ended 30 June 2025, HCLTech reported revenues of Rs. 30,349 Crores (approximately USD 3,545 Million). The net income for the quarter stood at Rs. 3,843 Crores (approximately USD 450 Million). Looking at the constant currency growth, HCLTech's overall revenue saw a quarter-on-quarter (QoQ) decline of 0.8% and a year-on-year (YoY) growth of 3.7%. HCLTech Services revenue also experienced a slight QoQ decline of 0.1% but registered a healthy 4.5% YoY growth in constant currency.

In a direct comparison of profitability, HCLTech's net income for Q1 FY26 stood at Rs. 3,843 Crores, marking a decline of approximately 10.8% when compared to the net income of Rs. 4,307 Crores reported in the preceding quarter, Q4 FY25. 

Despite a marginal sequential decline in revenue and net income, the company's gross profit margin for Q1 FY26 was 33.7%, with an EBITDA margin of 19.9%. Free Cash Flow for the quarter was Rs. 3,333 Crores (approximately USD 390 Million). The company's net cash position as of 30 June 2025 was Rs. 27,343 Crores (approximately USD 3,187 Million).

Client contribution to revenue remained largely stable, with the Top 5 clients accounting for 12.6%, the Top 10 clients for 20.2%, and the Top 20 clients contributing 29.9% of the revenue in Q1 FY26. Days Sales Outstanding (DSO) remained consistent at 59 days, reflecting efficient working capital management.

HCLTech's total people count stands at 223,151 as of 30 June 2025. The company added 1,984 freshers in Q1 FY26. Attrition (LTM) slightly decreased to 12.8%.

In conclusion, HCLTech's Q1 FY26 financial results, while showing some sequential moderation, highlight the company's underlying stability in its client relationships and a solid cash position. The consistent growth in larger client segments and stable people metrics suggests a robust operational foundation, positioning HCLTech to navigate the evolving market landscape effectively.