Q1 2026 Sonata Software Ltd Earnings Call Transcript
Key Points
- Sonata Software Ltd (BOM:532221) reported a 16% quarter-on-quarter growth in international services revenue, showcasing resilience amid mixed market conditions.
- The company secured three large deals in Q1 FY26, highlighting its growing relevance and transformation impact for clients.
- Sonata Software Ltd (BOM:532221) is making significant progress in the healthcare and life sciences (HLS) and banking, financial services, and insurance (BFSI) verticals, which now contribute over 30% of total revenue.
- The company is actively pursuing AI opportunities across 100+ clients, with AI-enabled services expected to contribute 20% of Sonata's revenue over the next three years.
- Sonata Software Ltd (BOM:532221) has been recognized among the ET best organizations to work for in 2025 and featured in Marksmen Daily as the most preferred workplace for 2025-26.
- Sonata Software Ltd (BOM:532221) is facing significant headwinds in the retail and manufacturing sectors due to global softness and tariff impacts.
- Two large clients, one in BFSI and another in high-tech, are experiencing budgetary pressures, affecting discretionary spending and growth.
- The company is navigating challenges in the IT and IT sector within SITL, including potential risks associated with large accounts where partners may opt for direct engagement.
- There is uncertainty regarding Microsoft's decision to go direct in the domestic business, which could impact Sonata's revenue from this segment.
- The company's EBITDA margin saw only a marginal improvement to 16.6%, with ongoing challenges in achieving the previously targeted 19-20% margin.
Ladies and gentlemen, good day and welcome to Sonata Software earnings conference call for the first quarter of FY26 ended June 30th, 2025. We have with us on the call today Samir Dhir, MD and CEO, Jagannathan CN, Chief Financial Officer.
We also have an extended leadership team on the call. Namely Sujit Mohanty, MDN CEO, SITL Business, Suresh HP CDO, Rajsekhar Datta Roy, CTO and Shilpa Kolhatkar, deputy CFO. Please note that all participants' lines will be in listen-only mode, and there will be an opportunity for you to ask questions after management's opening remarks.
(Operator Instructions)
Please note this conference is being recorded. Please note that during this call, management may make certain forward-looking statements that involve risks, assumptions, and are based on information. Currently available to management, Sonata does not undertake any obligation to update any such forward-looking statements that may be made in the course of this call.
We advise participants to exercise discretion while making any investment decisions. We will begin with opening
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