Tata Consultancy Services reports strong fiscal year 2023-24 performance amid global economic uncertainty
Tata Consultancy Services (TCS), a leading global IT services, consulting, and business solutions organization, has announced its financial results for the quarter and fiscal year ending March 31, 2024. The company reported a revenue of $7.36 billion, marking a 2.3% year-over-year growth, with a net income increase of 8.0% to $1.5 billion. The financial year saw significant advancements across various sectors, with substantial growth in India, the UK, and the manufacturing sector.
Tata Consultancy Services demonstrated robust financial health with a final dividend per share proposed at ₹28. The company’s free cash flow stood at $5.3 billion, with a shareholder payout of $5.6 billion through dividends and buybacks. TCS’s operating margin expanded by 150 basis points to 26.0%, while the net margin saw a 100 basis point increase to 20.3%.
The financial year underscored growth across multiple domains and geographies. Notably, the Indian market saw a remarkable increase of 37.9%, while the UK market grew by 6.2%. The manufacturing sector experienced a 9.7% growth. Despite a challenging global macroeconomic environment, TCS has effectively managed to maintain and expand its market presence, evidenced by broad-based deal wins across industries and regions.
K Krithivasan, CEO and Managing Director of TCS, expressed satisfaction with the company’s performance, citing the highest ever order book and a 26% operating margin as indicators of the robustness of TCS’s business model. “In an environment of global macro uncertainty, we are staying close to our customers and helping them execute on their core priorities with TCS’ portfolio of offerings, innovation capabilities, and thought leadership,” Krithivasan stated.
N Ganapathy Subramaniam, COO and Executive Director, highlighted the quarter’s robust performance and the diversified portfolio’s role in this success. Samir Seksaria, CFO, added that TCS’s disciplined operations approach has been key in expanding industry-leading margins and ensuring profitability amidst challenges.
TCS continued to innovate with significant focus on cloud migration, modernization, and artificial intelligence (AI). The company is a launch partner for the newly announced AWS Generative AI Competency and has introduced a Responsible AI Framework for Azure in the Azure Marketplace. These initiatives are part of TCS’s broader strategy to harness cutting-edge technology to enhance client businesses and operations globally.
TCS has also been active in forging strategic partnerships and expanding its community engagement. Noteworthy collaborations include a 15-year expansion with Aviva to enhance customer experience using the TCS BaNCS™ platform and a strategic partnership with Toyota Motor North America to transform IT infrastructure and customer experience.
As TCS navigates a complex global landscape, the company remains committed to its long-term strategies of innovation, customer engagement, and sustainable growth. The focus on digital transformation, AI, and cloud services is expected to drive future growth and help the company maintain its leadership position in the IT services industry.