HCLTech Q3 results : Revenue and profit surge, underpinned by strategic tech investments
HCLTech, a leading technology company, has announced its financial results for the quarter ended December 31, 2023 (Q3FY24), reflecting strong growth and innovation. The company reported a notable revenue of $3.415 billion, indicating a 5.9% quarter-over-quarter (QoQ) and 5.3% year-over-year (YoY) increase. Additionally, the EBIT margin for the quarter was 19.8%, demonstrating a 126 basis points (bps) QoQ expansion, underlining HCLTech’s robust execution and cost efficiencies.
The company’s performance was bolstered by winning 18 large deals in both services and software segments, amounting to a total contract value (TCV) of almost $2 billion. HCLTech also announced a dividend of ₹12 per equity share for the quarter, further highlighting its financial strength.
A remarkable growth in services revenue was observed, growing by 3.1% QoQ in constant currency, surpassing an annual run rate of $12 billion. HCLSoftware’s revenue for the quarter saw a 5% YoY increase, with an annual recurring revenue (ARR) of over $1 billion.
C Vijayakumar, CEO & Managing Director of HCLTech, expressed satisfaction with the quarter’s results, driven by momentum in both services and software businesses and an outstanding operating margin. He emphasized the company’s investment in AI, specifically Generative AI, as well as cloud native capabilities across products and services to meet evolving client needs. “We remain confident of our continued growth momentum,” he stated.
HCLTech Reports Exceptional Q3FY24 Results, Marking Continued Growth and Innovation
The company saw revenue growth in Europe at 5% QoQ (CC) and in the Americas at 3.1% QoQ. Industry vertical growth was led by the Telecom and Media sectors, followed by Manufacturing, Retail, and CPG. The Engineering and R&D Services business (ERS) grew by 8.7% QoQ, with significant contributions from the company’s recent acquisition of ASAP, based in Europe.
HCLTech provided constant currency revenue guidance of 5%-5.5% for FY24 and retained its EBIT margin guidance of 18-19% for the year. Prateek Aggarwal, Chief Financial Officer of HCLTech, highlighted the company’s stellar performance, with the highest ever EBIT of Rs. 5,615 Crores (up 7.4% YoY) and Net Profit of Rs. 4,350 Crores (up 6.2% YoY).
The company’s focus on leveraging technologies from GenAI to cloud computing has been instrumental in helping clients future-proof their businesses. Select GenAI deals won in the quarter include partnerships with a US-based global communication services provider, a US-based chemicals manufacturer, and a leading US-based financial services firm.
HCLTech’s impressive financial performance in Q3FY24, coupled with its strategic focus on innovative technologies like Generative AI and cloud computing, positions the company at the forefront of the global technology industry. The company’s success is not just reflected in its financial results but also in its ability to drive forward-thinking solutions that cater to diverse sectors.
The company’s attrition rate moderated further to 12.76% from 14.2% in Q2 FY24 and 21.7% YoY, showcasing its strong employee retention strategies. The addition of over 3,600 people in this quarter, taking its total headcount to over 224,700 across 60 countries, highlights HCLTech’s commitment to global expansion and talent acquisition.
These achievements underscore HCLTech’s dedication to delivering high-quality technology solutions and its capacity to adapt to the rapidly evolving demands of the global market. The company’s focus on sustainability, innovation, and customer-centric solutions has solidified its position as a leader in the technology sector, paving the way for continued growth and success in the years to come.
In summary, HCLTech’s Q3FY24 results reflect its strong financial health, innovative spirit, and strategic positioning in the technology sector. The company’s commitment to investing in cutting-edge technologies and expanding its global footprint is set to drive its growth trajectory, making it a key player in the ever-evolving world of technology and digital transformation.