Tata Consultancy Services (TCS) reported annualised artificial intelligence (AI) revenue of $2.6 billion for the June quarter, up from $2.3 billion in the March quarter and $1.8 billion in the December quarter, showing steady growth in its AI-led business.
During the latest quarter, the company signed several AI- led deals, including an $800 million engagement with SKF and a multi-million dollar deal with ServiceNow. It also recently announced a multi-year AI partnership with ABB to modernise the engineering company’s global network operations.
The AI momentum came as TCS posted a 5% year-on-year rise in consolidated net profit to Rs 13,349 crore for the quarter ended June 30, while revenue increased 13.9% to Rs 72,275 crore. The company’s board has declared an interim dividend of Rs 12 per share.
Glass half full
Chief Executive K Krithivasan said the company expects business conditions to improve in the second quarter, with sectors such as manufacturing, life sciences and communications likely to recover after a weak start to the financial year. Banking, financial services and insurance (BFSI) continued to remain the strongest growth driver during the quarter.
The company said clients are moving beyond AI pilots and are increasingly deploying AI at scale. TCS is also seeing demand for projects that combine generative AI with cloud, data and automation services, Krithivasan said.
Despite continued macroeconomic uncertainty, TCS maintained that AI spending remains resilient as enterprises prioritise productivity improvements and business transformation. The company said AI is becoming a larger part of client technology budgets even as discretionary spending in some traditional IT projects remains under pressure.
The June quarter also saw TCS add more than 9,000 employees, taking its total workforce to over 5.84 lakh. Attrition remained stable during the quarter, according to the company’s earnings statement.
TCS’ deal pipeline remained healthy, according to its earnings statement, although the company said decision-making cycles in some sectors continue to be longer because of global economic uncertainty. The management expects the recovery to become more visible from the second quarter if client spending improves across stressed verticals.
