Q1 2026 HCL Technologies Ltd Earnings Call Transcript
Key Points
- HCL Technologies Ltd (BOM:532281) reported a year-on-year revenue increase of 3.7% in constant currency, driven by growth in several verticals including technology and services, telecom and media, retail and CPG, and financial services.
- The company saw strong geographical growth, with Europe growing by 9.6% and the rest of the world by 15% year-on-year.
- HCL Technologies Ltd (BOM:532281) added significant clients across various categories, including six in the $50 million category and 11 in the $20 million category year-on-year.
- The company announced strategic partnerships with OpenAI and other tech leaders to drive enterprise AI transformation, enhancing its AI capabilities and market positioning.
- HCL Technologies Ltd (BOM:532281) improved its revenue guidance for FY26 to 3% to 5% in constant currency, reflecting confidence in future growth prospects.
- The operating margin for the quarter was 16.3%, which was lower than planned due to factors such as reduced utilization, a client bankruptcy, and continued investments in AI and go-to-market capabilities.
- HCL Software experienced a weak quarter with a 3% year-on-year decline in revenue, although the annual recurring revenue showed a slight increase.
- The company faced challenges with utilization due to a mismatch in skills and location, impacting operating margins.
- There was a delay in closing some large deals, which moved from Q1 to Q2, affecting the total contract value (TCV) for the quarter.
- The company adjusted its EBIT margin guidance to 17% to 18% for FY26, down from previous expectations, due to unforeseen challenges and restructuring costs.
Ladies and gentlemen, good day, and welcome to HCL Tech's Q1 FY26 earnings conference call. (Operator Instructions). Please note that this conference is being recorded. I now hand the conference over to Mr. Nitin Mohta, Head Investor Relations.
Thank you, and over to you, sir.
Thank you, Doran. Good morning, and good evening, everyone. A very warm welcome to HCL Tech's Q1 FY26 Earnings Call. We have with us Mr. C. Vijay Kumar, CEO and Managing Director, HCL Tech; Mr. Shiv Valia, Chief Financial Officer; along with the broader leadership team to discuss the performance of the company during the quarter, followed by a Q&A.
In the course of this call, certain statements that will be made are forward looking, which involve a number of risks, uncertainties, assumptions and other factors that could cause actual results to differ materially from those in such forward-looking statements.
All forward-looking statements made herein are based upon
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