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• Total Revenue: $3,445 million, a 1.6% increase quarter on quarter and a 6.2% growth year on year in constant currency.

• Services Revenue: $3,114 million, a 1.6% increase quarter on quarter and a 5.9% growth year on year in constant currency.

• Software Revenue: $342 million, a 1.4% increase quarter on quarter and a 9.4% growth year on year in constant currency.

• Operating Margin (EBIT): 18.6%, an improvement of 149 basis points quarter on quarter.

• Net Income: $506 million, representing 14.7% of revenue.

• Return on Invested Capital (ROIC): 35.7%, up 350 basis points year on year.

• Operating Cash Flow: $2.52 billion over the last 12 months.

• Free Cash Flow: $2.39 billion over the last 12 months.

• Gross Cash: $3.44 billion.

• Net Cash: $3.17 billion.

• Days Sales Outstanding (DSO): 79 days, a 3-day improvement quarter on quarter.

• Diluted Earnings Per Share: INR62.02, an improvement of 8.9% year on year.

• Interim Dividend: INR20 per share for the quarter.

• Revenue Guidance: Revised to 3.5% to 5% year on year growth in constant currency.

• EBIT Margin Guidance: Unchanged at 18% to 19%.

• Warning! GuruFocus has detected 7 Warning Signs with BOM:532281.

Release Date: October 14, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• HCL Technologies Ltd (BOM:532281) reported a 1.6% sequential revenue growth and a 6.2% year-on-year increase in constant currency, indicating strong business momentum.

• The company's operating margin improved to 18.6%, an increase of 149 basis points from the previous quarter, showcasing effective operational execution.

• HCLSoftware business demonstrated significant growth with a 9.4% increase this quarter and a 6.4% growth in H1 FY25, highlighting the relevance of its products in the digital economy.

• The company secured 20 new deals in Q2, with a total new booking TCV of $2.2 billion, reflecting a healthy mix of small and large deals.

• HCL Technologies Ltd (BOM:532281) continues to witness strong traction in AI and GenAI-related opportunities, with its AI Force platform being widely adopted for service transformation.

Negative Points

• The financial services vertical experienced a decline due to the planned divestment, impacting overall growth in this sector.

• Despite overall growth, the Rest of the World (ROW) region saw a year-on-year decline of 2.6% in constant currency.

• The automotive sector, particularly in Europe, is facing pressure, which could impact future growth in this segment.

• The company's guidance for the second half of FY25 indicates a cautious outlook, with expected growth between 3.5% to 5% year-on-year in constant currency.

• There is a noted volatility in the software business, making it challenging to predict consistent long-term growth despite recent strong performance.