HCL Tech Q2 results preview: Revenue may rise 8-10% YoY; focus to be on guidance, deal TCV, GenAI adoption

HCL Tech Q2 results preview: HCL Technologies will report its July-September quarter (Q2FY26) earnings on Monday, October 13. The IT major's numbers are expected to be mixed, with a decent year-over-year (YoY) rise in revenue, but the operating margin may remain under pressure.

In Q1FY26, India's third-largest IT company in terms of market capitalisation reported an almost 10 per cent YoY fall in its consolidated profit, while revenue from operations rose by 8 per cent YoY.

It projected its revenue to grow between 3 per cent and 5 per cent year-on-year in constant currency (CC), and EBIT margin may stay between 17 per cent and 18 per cent in FY26.

Experts expect the company to reveal its FY26 revenue and margin projections.

HCL Tech Q2 results preview: What top brokerages expect

Axis Securities expects HCL Tech's revenue to grow by 3 per cent QoQ and 8.3 per cent YoY, led by the BFSI and Hi-tech verticals, while the service business may remain weak. Profit after tax may rise by 11.2 per cent QoQ and 0.9 per cent YoY.

Margin may decline on a year-over-year basis. The brokerage firm said HCL Tech's operating margins may increase by 87 bps QoQ but shrink by 142 bps YoY.

"Key factors to monitor include deal TCV and pipeline, updates on ER&D and service business, and GenAI adoption," said Axis Securities.

According to Kotak Institutional Equities, HCL Tech's revenue may increase by 9.7 per cent YoY and 4.3 per cent QoQ, while adjusted PAT may increase by 1.3 per cent YoY and 11.4 per cent QoQ.

Kotak expects HCL Tech to retain 3-5 per cent revenue growth guidance for FY26 and 17-18 per cent EBIT margin guidance.

Kotak believes HCL Tech may announce a healthy deal TCV wins in the range of $25-3 billion. The brokerage firm underscored that HCL Tech closed two large deals that management hoped for and communicated in the Q1FY26 earnings call.

Kotak expects investors to focus on the margin recovery outlook, the impact of US tariffs on directly affected segments of manufacturing and retail, and profitability from cost take-out and vendor consolidation deals.

Additionally, discretionary spending trends, the pace of enterprise AI adoption, new opportunities arising from AI adoption, and the underlying growth environment will also be in focus.

Brokerage firm Motilal Oswal Financial Services believes that HCL Tech's BFSI and Hi-tech segments will perform better, while the manufacturing segment may remain under pressure.

Motilal expects 1.7 per cent QoQ growth in constant currency terms, supported by revenue contribution from vendor consolidation deals from Q2 onward.

Margins, as per Motilal, may improve by 50 basis points despite investments in GenAI and SG&A, as well as restructuring costs.

Motilal expects HCL Tech to retain its FY26 revenue growth guidance of 3-5 per cent YoY in constant currency.

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