IT services giant Tech Mahindra has clocked in a profit after tax (PAT) of ₹494 crore for the July to September period, more than 28% lower than the preceding quarter of 2023-24, the company's financial results announced on October 25 showed.
Tech Mahindra came in more than 25% lower than the CNBC-TV18 projection of ₹663 crore.
The IT firm missed poll expectations on the revenue front as well.
The company’s revenue in dollar terms slipped 2.8% sequentially to $1,555 million while the analysts polled by CNBC-TV18 had expected a 0.4% drop. In rupee terms, the revenue declined to ₹12.864 crore.
Tech Mahindra’s margin for the quarter that ended September 30, 2023, saw a decline of more than 210 basis points to 4.7%. Its earnings before interest, taxes, depreciation, and amortisation (EBITDA) for the quarter under review was recorded at ₹606 crore, 32% lower than that in the June quarter.
Amid a decrease in revenue, Tech Mahindra said some of its customers have stopped or are reducing spending and that the firm would invest in new verticals and diversify.
The firm said it witnessed large deals worth $640 million in the second quarter. It also claimed that the deal pipeline for the second half of FY24, i.e. October to March, is very strong.
In a press briefing following the results announcement, the firm said it has trained more than 10,000 employees in Generative AI. It also said that it is working on 60 customer locations on using Gen AI for better operations, innovations and productivity as Gen AI can take over a lot of the routine work.
Tech Mahindra's attrition rate, meanwhile, has slipped to 11% in Q2FY24 from 13% in Q1FY24.
The IT firm has also declared an interim dividend of ₹12 per share for its shareholders.
First Published: Oct 25, 2023 3:59 PM IST
