• Revenue growth: International markets grew 1.2%, led by the UK; BFSI, manufacturing, and tech and services each grew 2.5% to 3% sequentially. India was the differentiator because of volatility, while all service lines grew.
• AI opportunity: AI revenue reached $3.1 billion on an annualized basis, up $500 million from the previous quarter. Aarti said about 70% to 80% was new, under a definition that counts AI-led business transformation projects but excludes AI used within other programs; these projects largely run for 3 months to 6 months.
• Deal momentum: TCV was $9.6 billion, excluding Best Buy and Porsche, which will be included when they close. Management described this as strong deal momentum and said the quarter marked a 5th consecutive quarter of sequential growth despite an unchanged demand environment.
• Margins and investment: Operating margins remained flat at 24% despite investments in strategic partnerships, M&A, niche hiring, bench capacity for new-age skills, and subcontractors; currency and operating leverage partly offset these costs.
• Hiring and skills: Attrition reduced by 30 bps and was stable. The company added 4,500 niche hires, with about 25% to 30% having AI skills and 80% having new-age skills including AI, and is using AI in recruitment to improve speed, quality, and candidate reach.