Tech Mahindra Q1 Results: Net profit declines 38% to ₹692.3 crore on weaker CME, BFSI verticals; revenue up 3.5% YoY

  • Tech Mahindra Q1 Results: The IT major's revenue from operations during the first quarter of current fiscal stood at 13,159 crore, compared to 12,707 crore in the year-ago period.

Nikita Prasad
Published26 Jul 2023, 04:24 PM IST
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Employees walk past singage Tech Mahindra Ltd. outside one of the company’s office buildings in the Electronic City area of Bengaluru. Photographer: Dhiraj Singh/Bloomberg(Bloomberg)

Tech Mahindra Q1 Results: Tech Mahindra announced its April-June quarter results for fiscal 2023-24 (Q1FY24) on July 26, reporting a decline of 38 per cent in consolidated net profit at 692.5 crore, compared to 1,131 crore in the year-ago period. The fall in the company's profit was on the back of weakness reported in its key segments.

The IT major's consolidated revenue from operations during the first quarter of current fiscal stood at 13,159 crore, reporting a rise of 3.5 per cent, compared to 12,707 crore in the year-ago period. 

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On the operating front, the company's earnings before interest, taxes, depreciation, and amortization (EBITDA) in the June quarter declined 28.8 per cent year-on-year to 1,338 crore, while earnings per share (EPS) stood at 7.82. EBITDA stood at 1,880 crore in the corresponding quarter last year.

Segment-wise, the company's revenue from the communications, media and entertainment (CME) dropped eight per cent year-on-year, in line with Street estimates, while that from the banking, financial services and insurance (BFSI) dropped 5.4 per cent from the previous-year period.

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The revenue from manufacturing and technology rose 8.6 per cent and 8 per cent year-on-year, respectively for the first quarter. The new deal wins in the June quarter more than halved to $359 million, compared to $802 million in the corresponding period last year, and and $592 million in the preceding January-March quarter of fiscal 2022-23.

"This quarter was a challenging one for us as revenue growth faced strong headwinds and that had an impact on profitability. We have taken swift and decisive actions to address these issues and improve our execution," said Rohit Anand, CFO, Tech Mahindra.

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The company's total headcount stood at 148,297, at the end of the June quarter, down 4,103 quarter-on-quarter. The company has cash and cash equivalent at 7,701 crore as of June 30, 2023. The voluntary attrition during the quarter further fell to 13 per cent in the first quarter, compared to 15 per cent in the preceding January-March quarter of fiscal 2022-23 and 22 per cent in the year-ago period.

"Our results this quarter reflect the uncertainty in the global economy and the IT sector. We are confident that we have the right strategy and the right team to overcome this temporary setback and deliver long term value for our customers and shareholders,'' said CP Gurnani, Managing Director & Chief Executive Officer, Tech Mahindra.

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Ahead of Q1FY24 earnings announcement today, shares of Tech Mahindra settled 0.84 per cent lower at 1,144.05 apiece on the BSE.

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Business NewsCompaniesCompany ResultsTech Mahindra Q1 Results: Net profit declines 38% to ₹692.3 crore on weaker CME, BFSI verticals; revenue up 3.5% YoY
First Published:26 Jul 2023, 04:24 PM IST
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