TCS Q4 FY25 Results: Profit Dips Marginally Amid Strong Revenue Growth
India’s top IT services firm, Tata Consultancy Services (TCS), announced its Q4 FY25 results on Thursday, during a market holiday. The numbers show a slight dip in net profit but steady revenue growth, reflecting the mixed impact of global challenges and strong sectoral performance.
Q4 Snapshot: Modest Dip in Profit
In the March quarter of FY25, TCS reported a net profit of ₹12,224 crore, down 1.26% from the December 2024 quarter. However, revenue from operations rose 0.79% to ₹64,479 crore over the same period.
Compared to the same quarter last year, profit declined 1.69%, while revenue saw a 5.29% increase. This growth was fueled by a 22.5% jump in Regional Markets, along with gains in Energy, Resources, and Utilities (ERU) and Banking, Financial Services, and Insurance (BFSI).
Annual Performance: Growth Steady in Tough Times
Despite economic uncertainties, TCS posted a net profit of ₹48,553 crore for FY25, a 5.76% rise from the previous year. Revenue grew 5.99% to ₹2,55,324 crore, with constant currency growth of 4.2% YoY.
The company’s stronghold in regional markets was evident, with a remarkable 37.2% YoY growth. Profit before tax stood at ₹65,331 crore, a 5.38% rise.
Also Read:Â After a 19-Year Streak Break, TCS Headcount Rebound Signals New Strategy
Margins and Cash Flow: Healthy Fundamentals
For Q4 FY25, operating and net margins were at 24.2% and 19.0%, respectively. The cash conversion ratio stood at 125.1%, indicating efficient operations. Free cash flow for the year was ₹46,449 crore, with shareholder payouts totaling ₹44,962 crore.
The total contract value (TCV) for FY25 was $39.4 billion, while Q4 TCV came in at $12.2 billion, reflecting a strong order pipeline.
Talent, Clients, and Leadership Changes
TCS closed the year with 607,979 employees, representing 152 nationalities. Women accounted for 35.2% of the workforce. Attrition stood at 13.3%, showing improved stability.
Client metrics also saw positive movement, with 64 clients in the $100 million+ band, adding two new clients over the year.
On the leadership front, Aarthi Subramanian was appointed as President and COO, while Mangesh Sathe became the new Chief Strategy Officer.
Caution Ahead: Salary Hikes Deferred
TCS announced a deferral of employee salary hikes starting April, due to macroeconomic uncertainties and the ongoing tariff war involving the US. The company said hikes would be implemented later in the year, depending on market clarity.
Leadership Speak
CEO K Krithivasan highlighted that TCS crossed the $30 billion revenue mark, attributing success to the company’s AI expertise and customer-centric innovation. He emphasized TCS’s role in supporting global clients amid economic instability.
CFO Samir Seksaria noted that despite global headwinds, TCS maintained strong profitability and cash flows without compromising on long-term investments in people, innovation, and infrastructure.
Looking Forward
The TCS Q4 FY25 results show a company staying resilient in a volatile market. While profits dipped slightly, revenue, contracts, and client engagement remain strong. With a steady eye on innovation and operational discipline, TCS continues to be a global tech leader.
