In This Article:
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Revenue: $3,533 million, a 3.8% increase quarter on quarter and 4.1% growth year on year in constant currency.
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Services Revenue: $3,145 million, a 2.2% increase quarter on quarter and 4.9% growth year on year in constant currency.
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Software Revenue: $400 million, an 18.7% increase quarter on quarter and a 2.1% decline year on year in constant currency.
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Operating Margin (EBIT): 19.5% of revenue, with EBIT at $690 million.
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Net Income: $544 million, representing 15.4% of revenue.
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Annual Recurring Revenue (ARR) for HCL Software: $1.022 billion, a 0.6% decline year on year in constant currency.
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Total Contract Value (TCV) for Q3: $2.1 billion.
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Annual Contract Value (ACV): 23% growth year on year and 19% growth sequentially.
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Return on Invested Capital (ROIC): 36.6% for the company, up 385 basis points year on year.
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Operating Cash Flow: $285 billion over the last 12 months.
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Free Cash Flow: $2.72 billion over the last 12 months.
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Gross Cash: $3.5 billion.
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Net Cash: $3.24 billion.
Release Date: January 13, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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HCL Technologies Ltd (BOM:532281) reported a sequential revenue growth of 3.8% and a year-on-year growth of 4.1% in constant currency.
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The company's operating margins improved to 19.5%, with the software business achieving an all-time high EBIT margin of 34.5%.
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HCL Technologies Ltd (BOM:532281) added two clients in the $100 million category and four each in the $50 million and $20 million categories, indicating strong client relationships.
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The company reported a 23% year-on-year growth in Annual Contract Value (ACV), showcasing strong deal momentum.
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HCL Technologies Ltd (BOM:532281) continues to leverage AI and generative AI to drive transformation, with significant wins in AI-led projects and a strong pipeline nearing all-time highs.
Negative Points
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HCL Software experienced a year-on-year revenue decline of 2.1% in constant currency, with some customers deferring renewal decisions.
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The company's attrition rate increased slightly to 13.2% on a last twelve months basis, reflecting challenges in retaining talent.
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There is a planned reduction in a mega telecom deal, which is expected to impact Q4 performance.
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The automotive sector remains challenged, with expectations of continued declines for one or two more quarters.
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HCL Technologies Ltd (BOM:532281) anticipates a softer Q4 due to the completion of a large transformation project and slower ramp-up of discretionary deals.