• Revenue momentum: International-market growth came at 1.2%, with BFSI, Manufacturing, and Tech and Services among the leading verticals; all verticals grew sequentially 2.5% to 3%. UK led among markets, while volatility in India differentiated performance.
• AI revenue: AI revenue reached 3.1 billion on an annualized basis, up 500 million from the previous quarter; management said about 70% to 80% has to be made new, under a definition that excludes AI used within projects such as SAP programs or software engineering. AI-driven efficiency savings are helping fund transformation and innovation projects, which management said are scaling up.
• Margins and talent: Margins remained flat at 24% despite four investment areas, including strategic partnerships, niche hiring, capacity for new-age skills, and higher subcontractor costs; currency and operating leverage provided some offset. The company added 4,500 employees, attrition decreased by 30 bps, and 25% to 30% of hires had AI skills while 80% had new-age skills including AI; internal learning and cross-skilling remain its biggest channel.
• TCV and pipeline: TCV was 9.6 billion, excluding Best Buy and Porsche until they close; management said both should come after closing in Q3, and that the pipeline, conversion, and win rates look good. It expects the order book to remain good, with North America and the UK singled out as geographies that have performed well.
• GCC and sector demand: Best Buy was described as a unique reverse transition, with TCS taking over an existing GCC using AI-enabled, AI-powered solutions. BFSI, Manufacturing, and Technology had strong growth, while stress continued in Consumer, Utilities, and Energy Resources.