HCLTech Delivers Strong Q2 With Record Growth in Software Business

Revises revenue guidance for FY25 to 3.5%–5% and retains margin guidance at 18%-19%

HCLTech, a leading global technology company, reported a stellar performance for the quarter ended September 30, 2024, with HCLSoftware delivering a strong revenue growth.

During the quarter, HCLTech won new deals across industry verticals with Total Contract Value worth $2.2 billion. The company revised the lower end of its revenue growth guidance for FY25 to 3.5%-5% (CC) and maintained EBIT margin guidance at 18%-19% for the period. The company declared a dividend of ₹12 per share.

“We delivered a strong quarter with revenue growing 1.6% QoQ in constant currency and EBIT coming in at 18.6%. This growth was well distributed across verticals, geographies and offerings. HCLSoftware has delivered a stellar performance of 9.4% YoY this quarter and 6.4% growth in H1 FY25 in constant currency, demonstrating the increasing relevance of our products for the digital economy. Our pipeline is very strong, including Data & AI, Digital Engineering, SAP migration and efficiency-led programs. Our GenAI offerings like AI Force and AI Foundry are resonating very well with our clients and should be drivers of efficiency, growth and innovation over the medium term,” said C Vijayakumar, CEO & Managing Director, HCLTech.

Revenue in constant currency (CC) grew 6.2% YoY, while dollar revenue came in at $3.4 billion, up 6.8% YoY. Services revenue for the quarter was up 5.9% YoY (CC) while Digital revenue was up 7.8% YoY (CC). Engineering and R&D Services business (ERS) grew by 4.3% YoY (CC).

Geographically, Americas recorded the highest revenue growth of 7.5% YoY (CC), followed by Europe at 4.2% YoY (CC). Industry vertical growth was led by Telecommunications, Media, Publishing & Entertainment (61.2% YoY in CC), followed by Manufacturing (7.1% YoY in CC) and Retail & CPG (6.2% YoY in CC).

“HCLTech has delivered robust financial results with constant currency (CC) revenue growth at an industry leading 6.2% YoY. INR revenue reached ₹28,862 crores, marking a sequential growth of 2.9% and a YoY growth of 8.2%. This revenue growth has come with an improved profitability. Our EBIT margins in Q2 rose to 18.6%, up 149 bps sequentially,” said Shiv Walia, Chief Financial Officer, HCLTech.

The company hired 2,932 freshers during Q2 FY25 while attrition (last twelve months) was at 12.9%.

HCLTech continues to leverage technologies from GenAI to cloud computing to help its clients future-proof their businesses.

Among the select AI, GenAI and Software deals that HCLTech won in the quarter are:

• A Fortune 200 biopharma major selected HCLTech as its strategic partner for SAP managed services. HCLTech will use integrated delivery, automation and GenAI to improve operational efficiency, lower costs and enhance service quality for the client.
• A leading US-based software company selected HCLTech AI Force to build a quick search functionality to find duplicate bugs. The deployment improved tester efficiency by 15%, resulting in considerable time savings and improved productivity.
• A US-based automotive company selected HCLTech to develop an AI-based solution for customer segmentation and dynamic price optimization. HCLTech will deploy its Enterprise AI Foundry to build and operationalize models that enhance after-market sales operations.
• A leading India-based energy company selected HCLSoftware’s BigFix for unified endpoint management. The deployment will enhance compliance, boost vulnerability management and improve employee experience through intelligent automation.

Other Achievements:

• Roshni Nadar Malhotra, Chairperson, HCLTech was conferred the Chevalier de la Légion d’Honneur, France’s highest civilian award
• Ranked No. 1 India-headquartered company in TIME magazine's list of World's Best Companies 2024
• Ranked No. 7 in the Businessworld list of India’s Top 50 Most Sustainable Companies 2024

About HCLTech

HCLTech is a global technology company, home to more than 218,000 people across 59 countries, delivering industry-leading capabilities centered around digital, engineering, cloud and AI, powered by a broad portfolio of technology services and products. We work with clients across all major verticals, providing industry solutions for Financial Services, Manufacturing, Life Sciences and Healthcare, Technology and Services, Telecom and Media, Retail and CPG and Public Services. Consolidated revenues as of 12 months ending September 2024 totaled $13.7 billion. To learn how we can supercharge progress for you, visit hcltech.com.

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