HCL Technologies Q2 FY26 Results Overview
Strong Revenue Growth of HCL Technologies
HCL Technologies reported consolidated revenue of around ₹31,942 crore for the second quarter of FY26, marking an 11% increase from the same period last year. In constant currency terms, revenue rose by 4.6% year-on-year and 2.4% quarter-on-quarter. The company’s digital services segment led the momentum with about 15% annual growth, now contributing nearly 42% of total services revenue.
The AI-focused business segment also crossed a key milestone, generating over $100 million in quarterly revenue, reflecting growing adoption of HCL’s AI and automation offerings.
Profitability and Margins
The company posted a net profit (PAT) of ₹4,235 crore — almost flat compared to last year’s figure. Operating profit (EBIT) came in at around ₹5,550 crore, with a margin of 17.4%. Margins saw a modest improvement quarter-on-quarter, driven by improved utilization rates, a favorable exchange rate, and better cost optimization. However, higher employee expenses and restructuring costs partially offset these gains.
Dividend and Shareholder Returns
HCL declared an interim dividend of ₹12 per share for the quarter. This marks the company’s 91st consecutive quarterly dividend, showcasing its consistent commitment to rewarding shareholders.
Workforce and Salary Updates
The company added about 3,500 employees during the quarter, taking its total workforce to over 2.26 lakh globally. Attrition continued to improve, falling to 12.6% compared to 12.9% a year earlier.
HCL also announced a salary hike for employees effective October 2025. In a significant move, the company is merging quarterly variable pay with fixed pay — effectively making it part of monthly salaries. This change aims to improve income consistency for junior employees and simplify the pay structure across levels.
Future Outlook and Guidance
HCL maintained its full-year revenue growth guidance of 3% to 5% in constant currency terms and an operating margin outlook between 17% and 18%. Within this, the services business is expected to grow slightly higher at 4% to 5%.
The management expressed confidence in sustaining growth through strong deal momentum, an expanding AI portfolio, and reduced dependence on H-1B visas through local hiring and global delivery centers. Total contract value (TCV) for the quarter stood at approximately $2.6 billion, indicating robust demand in key verticals.
What Lies Ahead
The key focus areas for HCL in the coming quarters will include:
- Maintaining operating margins amid rising wage and delivery costs.
- Scaling its AI-led services and digital transformation business.
- Converting strong deal bookings into actual revenue growth.
- Managing workforce transitions smoothly under the new pay model.
- Navigating macroeconomic uncertainties, currency movements, and global demand trends.
Summary:
HCL Technologies delivered a solid revenue performance in Q2 FY26, driven by its digital and AI businesses. Profits remained stable, with improved operational efficiency and a steady margin profile. With consistent dividends, salary hikes, and a healthy deal pipeline, the company remains on track for steady growth, though margin management and execution will be key to sustaining momentum.