TCS Q2 profit up 15% to Rs 13,884 crore; AI revenue tops $3.1 billion
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TCS reported Rs 13,884 crore net profit and Rs 73,188 crore revenue for July-September 2026 on 8 October, with annualised AI revenue above $3.1 billion.
What Happened
Tata Consultancy Services, India's largest IT services company, reported its results for the July-September 2026 quarter on Thursday, 8 October 2026. Consolidated revenue was Rs 73,188 crore, up 11.2 per cent from a year earlier and 1.3 per cent from the previous quarter. Net profit rose about 15 per cent to Rs 13,884 crore, from Rs 12,075 crore a year before. The company also said its annualised revenue from artificial intelligence services passed 3.1 billion US dollars, and its board declared a second interim dividend of Rs 12 per share.
Key Facts
- Consolidated revenue: Rs 73,188 crore, up 11.2% year on year and 1.3% from the previous quarter.
- In US dollar terms, revenue was about 7.64 billion dollars, up 2.4% year on year.
- Net profit: Rs 13,884 crore, about 15% higher than Rs 12,075 crore a year earlier. Some outlets quoted a slightly different profit figure, so the company's filing is the reference.
- Annualised AI services revenue: more than 3.1 billion dollars, up from 2.6 billion dollars in the previous quarter.
- Total contract value of deals signed in the quarter: 9.6 billion dollars.
- Second interim dividend of Rs 12 per share, with 14 October as the record date.
- TCS also announced the acquisition of MHP, the management and IT consulting subsidiary of Porsche AG, linked to a five-year partnership with Porsche.
- Chief Executive K Krithivasan said the company is building "repeatable value platforms that will industrialise AI at scale".
Why It Matters
TCS reports first among India's big IT firms each quarter, so its numbers are read as a signal for the whole sector. Rupee revenue grew by double digits, but dollar revenue grew only 0.2 per cent from the previous quarter and 2.4 per cent from a year ago. The gap between the two reflects currency movements, and it shows that growth in real demand is slower than the rupee figures suggest.
The AI figure is the part many investors watched. TCS said annualised AI revenue rose by 0.5 billion dollars in one quarter and is now more than a tenth of its total revenue. This is the company's own measure, and it does not define it in the same way as other firms, so comparisons with rivals should be made with care.
The deal value of 9.6 billion dollars is a measure of work booked for future quarters. A large figure suggests clients are still signing contracts despite a cautious global environment.
The MHP purchase gives TCS a larger position in automotive consulting in Europe. Reports said management expects acquisition-related costs to weigh on the second half of the financial year.
The markets reacted on Friday. TCS was among the top gainers on the Sensex, rising about 4 per cent, as IT shares led a broader recovery.
Key numbers at a glance Measure | July-September 2026 Revenue | Rs 73,188 crore Net profit | Rs 13,884 crore Contract value signed | 9.6 billion dollars Annualised AI revenue | 3.1 billion dollars Dividend | Rs 12 per share
Impact
Short-term: The results lifted IT shares on 9 October. Shareholders on record on 14 October receive the dividend.
Long-term: AI services are becoming a larger share of revenue for India's IT industry, which affects hiring, skills and pricing. The Porsche-linked acquisition adds to TCS's European automotive business.
Who is affected: Investors in TCS and other IT stocks, TCS employees and clients, and India's IT services sector.
Key Takeaway
TCS grew profit about 15 per cent in the September quarter and said its AI business now earns more than 3.1 billion dollars a year, while dollar revenue growth stayed modest.
Questions and Answers
What were TCS's Q2 results for 2026-27?
Revenue was Rs 73,188 crore and net profit was Rs 13,884 crore, about 15 per cent more than a year earlier.
How much dividend did TCS declare?
A second interim dividend of Rs 12 per share, with 14 October 2026 as the record date.
How big is TCS's AI business?
The company said annualised AI services revenue passed 3.1 billion dollars, up from 2.6 billion dollars in the previous quarter.
What is the MHP acquisition?
TCS is acquiring MHP, the management and IT consulting subsidiary of Porsche AG, as part of a five-year partnership with Porsche.
Sourced and fact-checked by the Peepals Global Editorial Team
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Reported, fact-checked and published by the Peepals Global Editorial Team.
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