TCS net profit dips nearly 14% to ₹7,008 crore in Q1, misses estimates
1 min read 09 Jul 2020, 06:03 PM ISTRajesh Gopinathan, CEO & MD, TCS said 'revenue impact of pandemic played out broadly along the lines we had anticipated at the start of the quarter'
PremiumTata Consultancy Service (TCS), India's biggest software services exporters, on Thursday reported nearly 14 per cent year-on-year (YOY) fall in net profit at ₹7,008 crore for quarter ended June 20. The decline in revenue was due to the delay in deals and project execution in the light of coronavirus pandemic. Bloomberg analysts projected the figure at ₹7,694 crore. TCS declared an interim dividend of ₹5 per equity share of ₹1 each of the company.
Consolidated revenue of the company increased by 0.39% on a year-on-year basis to ₹38,322 crore. The revenue in constant currency terms witnessed a drop of 6.3% cent on year-on-year basis.
India's biggest IT company reported 0.94%% year-on-year (YOY) fall in profit at ₹8,049 crore for the March quarter. The company's net profit declined by 12.9% on a quarter-on-quarter basis.
Commenting on TCS' Q1 performance, Rajesh Gopinathan, Chief Executive Officer and Managing Director, said, "The revenue impact of the pandemic played out broadly along the lines we had anticipated at the start of the quarter. It affected all verticals, with the exception of Life Sciences and Healthcare, with varying levels of impact. We believe it has bottomed out, and we should now start tracing our path to growth."
“Demand contraction was broad-based by geography. Other than Europe (up 2.7 per cent) and Latin America (up 0.2 per cent), growth declined in all other markets: North America (down 6.1 per cent), UK (down 8.5 per cent), India (down 27.6 per cent), Asia Pacific (down 3.2 per cent) and MEA (down 11.7 per cent)," the IT major said in a release.
"After an initial period of disruption, customers have now stabilized their operations and are now embarking on new beginnings to adapt and thrive in a post-pandemic world. We are seeing many customers focus on front-end transformation, resulting in significant traction for our products and services," Gopinathan added.
"We signed several large core transformation programs encompassing operations, applications, cloud and cybersecurity. Our Machine FirstTM approach, delivered using the Secure Borderless WorkspacesTM model is helping us win such opportunities. Very encouragingly, we saw customers launch new business transformation programs or restart deferred programs during the quarter. This is indicative of business confidence returning in pockets," TCS CEO further added.
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