HCL Technologies Q4FY26: Revenue ₹33,981 Cr, Net Profit ₹4,488 Cr, EBIT Margin 16.5%
HCL Technologies delivered Q4FY26 results with revenue of ₹33,981 crores and net profit of ₹4,488 crores, showing strong year-over-year growth despite sequential margin pressures. The company achieved annual FY26 revenue of ₹130,144 crores with Advanced AI revenue reaching $620 million. Management outlined comprehensive AI strategy and provided cautious FY27 guidance of 1-4% growth, citing client-specific challenges in Telecom and SAP segments while maintaining focus on AI transformation initiatives.
*this image is generated using AI for illustrative purposes only.
HCL Technologies has released its audited consolidated and standalone financial results for Q4FY26 and the full year ended March 31, 2026. The Board of Directors approved the financial results and declared an interim dividend of ₹24 per equity share for FY27, with a record date of April 25, 2026, and payment date of May 5, 2026.
Q4FY26 Quarterly Performance
The fourth quarter demonstrated steady revenue growth on a year-over-year basis while facing sequential challenges across key financial metrics, particularly in operational efficiency measures.
| Financial Metric: | Q4FY26 | Q4FY25 | Q3FY26 | YoY Change | QoQ Change |
|---|---|---|---|---|---|
| Revenue (₹ Crores): | 33,981 | 30,246 | 33,874 | +12.3% | +0.3% |
| Revenue ($M): | 3,682 | 3,498 | 3,793 | +5.3% | -2.9% |
| EBIT (₹ Crores): | 5,620 | 5,442 | 6,285 | +3.3% | -10.6% |
| EBIT Margin: | 16.5% | 18.0% | 18.56% | -142 bps | -206 bps |
| Net Income (₹ Crores): | 4,488 | 4,307 | 4,076 | +4.2% | +10.1% |
| Net Income Margin: | 13.2% | 14.2% | 12.0% | -98 bps | +120 bps |
Annual FY26 Financial Performance
The company delivered solid annual performance with revenue growth across multiple segments while maintaining strong operational metrics despite margin pressures.
| Annual Metric: | FY26 | FY25 | Change |
|---|---|---|---|
| Revenue (₹ Crores): | 130,144 | 117,055 | +11.2% |
| Revenue ($M): | 14,664 | 13,840 | +6.0% |
| EBIT (₹ Crores): | 22,397 | 21,420 | +4.6% |
| EBIT Margin: | 17.2% | 18.3% | -107 bps |
| Net Income (₹ Crores): | 16,642 | 17,390 | -4.3% |
| Net Income Margin: | 12.8% | 14.9% | -210 bps |
| EPS (Diluted): | ₹61.36 | ₹64.09 | -4.3% |
Exceptional Items Impact
The company's results were significantly affected by two major exceptional items during FY26. The New Labour Codes implementation resulted in a one-time increase in employee benefit provisions of ₹956 crores for the group, recognized in Q3FY26. Additionally, a material Bilateral Advance Pricing Agreement (BAPA) with a foreign tax authority created a ₹5,733 crores exceptional charge in Q4FY26 standalone results.
| Exceptional Items: | Impact (₹ Crores) |
|---|---|
| New Labour Codes (Group): | 956 |
| BAPA Impact (Standalone): | 5,733 |
| Tax Benefit on BAPA: | (1,531) |
| Net BAPA Impact: | 4,202 |
Segment-wise Revenue Performance
The company's diversified business model continued to drive growth across multiple segments, with IT and Business Services maintaining its position as the largest revenue contributor.
| Business Segment: | FY26 Revenue Mix | FY25 Revenue Mix | YoY Growth |
|---|---|---|---|
| IT and Business Services: | 73.8% | 73.9% | +11.2% |
| Engineering and R&D Services: | 16.9% | 16.2% | +16.3% |
| HCL Software: | 9.2% | 10.0% | +2.9% |
Advanced AI and Strategic Highlights
The company achieved significant milestones in its AI journey and maintained strong operational metrics throughout the year.
| Key Highlights: | FY26 Performance |
|---|---|
| Annualized Advanced AI Revenue: | $620M |
| Q4 Advanced AI Revenue: | $155M (+6.1% QoQ) |
| Total People Count: | 227,181 (Net addition: 3,761) |
| LTM Attrition: | 12.5% (down from 13.0%) |
| TCV New Deal Wins: | $9,323M |
Management Commentary on AI Strategy and Market Outlook
During the earnings conference call held on April 21, 2026, CEO C. Vijayakumar outlined the company's comprehensive AI strategy built on five strategic pillars. The management emphasized that AI momentum remained strong with nearly all deals incorporating an AI or GenAI component.
| AI Strategy Pillars: | Key Developments |
|---|---|
| Service Transformation: | AI Force deployed across 75 accounts |
| Differentiated IP: | 38 patents filed in Advanced AI technologies |
| New AI-led Services: | VisionX 2.0 and Kinetic AI.DC Ops launched |
| AI Partnerships: | Expanded collaborations with Google, AWS, NVIDIA |
| AI Talent Development: | 135,000 employees trained in GenAI |
Client-Specific Challenges and Market Dynamics
Management disclosed specific challenges that impacted Q4 performance and will influence FY27 guidance. Two large Telecom clients in the US reduced discretionary spending on digital business and engineering services during the quarter. Additionally, two SAP programs were discontinued, and procurement decisions were delayed in March.
| Challenge Areas: | Impact Description |
|---|---|
| Telecom Vertical: | Reduced discretionary spend by two large US clients |
| SAP Programs: | Two modernization programs discontinued |
| Procurement Delays: | March decision deferrals affecting software business |
| Client-Specific Issues: | 50 basis points growth headwind from two clients |
FY27 Guidance and Dividend Declaration
The company provided guidance for FY27 reflecting cautious optimism about market conditions and declared an interim dividend for FY27.
| Guidance Parameter: | FY27 Projection |
|---|---|
| Company Revenue Growth (CC): | 1.0% - 4.0% YoY |
| Services Revenue Growth (CC): | 1.5% - 4.5% YoY |
| EBIT Margin: | 17.5% - 18.5% |
| Interim Dividend FY27: | ₹24 per share |
| Full Year Dividend FY26: | ₹54 per share |
Balance Sheet Strength and Cash Flow
HCL Technologies maintained robust financial position with strong cash generation capabilities and healthy balance sheet metrics.
| Financial Position: | March 31, 2026 | March 31, 2025 |
|---|---|---|
| Total Assets (₹ Crores): | 116,258 | 105,544 |
| Cash and Cash Equivalents (₹ Crores): | 8,265 | 8,245 |
| Net Operating Cash Flow (₹ Crores): | 19,975 | 22,261 |
| Free Cash Flow (₹ Crores): | 18,553 | 21,153 |
Conference Call Recording and Regulatory Compliance
Following the announcement of financial results, the company has made the audio recording and complete transcript of the conference call held on April 21, 2026, available on its official website at www.hcltech.com/investor-relations . The transcript was formally submitted to BSE and NSE on April 24, 2026, in compliance with SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
The results demonstrate HCL Technologies' resilience in navigating regulatory changes and tax complexities while positioning for future growth through strategic investments in AI and digital transformation capabilities.
Historical Stock Returns for HCL Technologies
| 1 Day | 5 Days | 1 Month | 6 Months | 1 Year | 5 Years |
|---|---|---|---|---|---|
| -0.23% | -4.75% | -21.22% | -28.28% | -31.56% | +26.17% |
How will HCL Technologies' conservative FY27 revenue growth guidance of 1-4% compare against competitors in an increasingly AI-driven IT services market?
What strategic measures is HCL implementing to address the client concentration risk highlighted by the 50 basis points growth headwind from just two clients?
Will the $620M annualized Advanced AI revenue run-rate be sufficient to offset the declining discretionary spending in traditional telecom and SAP modernization segments?
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