HCL Technologies Ltd
HCL Technologies Q1 FY26 earnings call: Revenue & Margins
Q1 FY26 earnings call: what management guided on revenue, margins and order book.
The short version
HCLTech expects revenue growth of 3% to 5% in constant currency for FY26, improved from previous guidance, driven by strong Q1 performance and positive outlook for remaining quarters. Revenue Growth: HCLTech projects 3%-5% constant currency revenue growth for FY26, supported by strong Q1 performance and a balanced, diversified portfolio. - Margin Expectations: EBIT margin guidance is adjusted lower to 17%-18% for FY26 due to utilization challenges, restructuring, and AI investments, but the company aims to return to its aspirational 19%-20% margin range by FY27. - Earnings: Diluted EPS for the last 12 months is Rs.
From HCL Technologies Ltd's Q1 FY26 earnings-call transcript · updated 23 Aug 2026.
Revenue & Sales Performance
- HCLTech expects revenue growth of 3% to 5% in constant currency for FY26, improved from previous guidance, driven by strong Q1 performance and positive outlook for remaining quarters.
- Financial Services and Technology verticals show strong demand and discretionary spending, acting as growth engines.
- Pipeline remains strong with a focus on Digital business, Engineering Services, and AI-led transformational propositions, especially in application modernization.
- Delays in large deal signings moved from Q1 to Q2, with optimism for conversion and a step-up in TCV next quarter.
- AI and Gen AI are central to nearly every deal, with increased adoption impacting software development and IT operations positively.
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Profitability & Margins
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Capital Expenditure Plans
- The company is making strategic investments primarily in Generative AI and expansion of go-to-market teams.
- Investments involve people capability building, platform development, and associated token costs related to AI initiatives.
- These AI-focused investments are expected to normalize by FY27, with margins stabilizing thereafter.
- A restructuring program is underway both on people and non-people costs to enhance structural agility for the AI era; associated one-time costs are factored into current guidance.
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Ranked on what management guided this quarter
Rank buckets describe management commentary on revenue and margin. Not investment advice, and not a forecast of returns.
Fundraising & Capital Structure
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Order Book & Pipeline
- The company had two large deal signings expected by the end of June, which were delayed to July due to procedural reasons but remain intact.
- There is a large vendor consolidation win in the Financial Services (FS) vertical expected to drive strong revenue growth this year and next, though it's not included in bookings yet as it is time and material-based and recognized only upon billing.
- Net new bookings for Q1 were $1.8 billion, with good balance across service lines, geographies, and verticals.
- Several large deals moved from Q1 to Q2, impacting short-term revenue but expected to convert well.
- The pipeline remains strong, especially in Digital business, AI-driven solutions, application modernization, and contact center transformation.
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HCL Technologies Ltd — Quarterly revenue & net profit
Reported quarterly figures (₹ Cr). Latest (Q4 FY26): revenue ₹34.0K Cr, net profit ₹4.5K Cr. Revenue and profit are scaled separately — hover a quarter for exact figures.
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What HCL Technologies's management said in earlier quarters
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Frequently Asked Questions
What were HCL Technologies Ltd Q1 FY26 results?
HCLTech expects revenue growth of 3% to 5% in constant currency for FY26, improved from previous guidance, driven by strong Q1 performance and positive outlook for remaining quarters. Revenue Growth: HCLTech projects 3%-5% constant currency revenue growth for FY26, supported by strong Q1 performance and a balanced, diversified portfolio. - Margin Expectations: EBIT margin guidance is adjusted lower to 17%-18% for FY26 due to utilization challenges, restructuring, and AI investments, but the company aims to return to its aspirational 19%-20% margin range by FY27. - Earnings: Diluted EPS for the last 12 months is Rs.
What is HCL Technologies Ltd share price analysis?
HCL Technologies Ltd currently shows a neutral. The stock trades at a P/E of 20.4 with a market cap of ₹369,058 Cr. Investors should review the full earnings analysis for detailed insights.
Is HCL Technologies Ltd planning capital expenditure?
The company is making strategic investments primarily in Generative AI and expansion of go-to-market teams.
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This analysis is AI-generated based on publicly available earnings data and the company's earnings call transcript. This is not investment advice. Please consult a SEBI-registered advisor before making investment decisions.