TCS declares Rs 57/share dividend: Net profit falls 14% YoY to Rs 10,657 crore

Tata Consultancy Services (TCS) has reported a resilient financial performance for the third quarter ending December 31, 2025, characterised by a significant surge in AI-driven demand and a robust order book. The company achieved a consolidated revenue of Rs 67,087 crore, representing a 2.0 per cent sequential growth and a 0.8 per cent increase in constant currency. Net profit falls 14 per cent to Rs 10,657 crore YoY. A standout metric this quarter was the Annualised AI Services Revenue, which reached USD 1.8 billion, marking a sharp 17.3 per cent QoQ growth in constant currency. This surge underscores TCS' successful pivot toward "agentic AI" and next-generation platforms, positioning the firm as a primary beneficiary of the enterprise shift toward autonomous, AI-led operational models.

The company’s profitability remained strong, with an operating margin of 25.2 per cent and a net income of Rs 13,438 crore, up 8.5 per cent year-on-year. Shareholders are set to benefit from a substantial dividend payout of Rs 57 per share, which includes a special dividend of Rs 46. The quarter’s Total Contract Value (TCV) stood at a healthy USD 9.3 billion, reflecting sustained client confidence despite global macroeconomic shifts. Regionally, India led the growth charts with an 8.0 per cent QoQ increase, while Continental Europe and the Middle East & Africa (MEA) also showed positive momentum. Conversely, the UK and North American markets saw more muted growth, though they remain the bedrock of TCS’ global portfolio.

Strategically, TCS is aggressively expanding its AI infrastructure and consulting capabilities. The quarter saw the announcement of a landmark partnership with TPG to support HyperVault, TCS’ AI data centre business. This initiative aims to build gigawatt-scale, AI-ready infrastructure, aligning with the company's ambition to become the world's largest AI-led technology services provider. Furthermore, the acquisition of Coastal Cloud, a specialist Salesforce Summit partner, bolsters TCS’ ability to offer AI-led business consulting. By adopting Google Cloud’s Gemini Enterprise, TCS is also transforming its internal workflows, empowering its workforce to develop advanced agentic AI solutions that simplify complex, multi-step enterprise operations.

The quarter’s deal wins highlight a diverse range of high-impact transformations across industries. Notable engagements include a five-year partnership with the NHS Supply Chain for AI-enabled cloud modernisation and an expanded 18-year relationship with ABB to implement an AI-powered "Zero Ops" framework. In the consumer space, TCS extended its partnership with Morrisons and signed a multi-year agreement with Canada Life to modernise core infrastructure. The company’s focus on sustainability was also evident through its collaboration with Tata Motors, utilising the AI-driven Prakriti platform to digitise ESG data and automate compliance.

With a workforce spanning 55 countries and a patent portfolio that now nears 9,500 applications, TCS continues to demonstrate its leadership in the global technology landscape. The company’s recognition as the "Best Company for Excellence in Managing Ideas for Innovation" at Tata InnoVista 2025 further validates its research-driven approach. As TCS moves into the final quarter of the fiscal year, its dual focus on scaling AI-ready infrastructure through HyperVault and delivering high-value, AI-integrated managed services suggests a strong trajectory for long-term, sustained growth.

Disclaimer: The article is for informational purposes only and not investment advice.