Datamatics Global Services Ltd. (DGSL) has reported robust financial results for the second quarter of fiscal year 2026, showcasing significant growth across key metrics.

Revenue and Profitability

The company's revenue for Q2 FY26 stood at Rs. 490.2 crores, marking a substantial year-on-year growth of 20.5% and a sequential increase of 4.8%. This growth trajectory reflects DGSL's strong market position and effective business strategies.

DGSL's profitability saw remarkable improvement:

*PAT after non-controlling interest

The company's EBITDA margin expanded significantly to 18.1%, representing a year-on-year increase of 613 basis points.

Segment Performance

DGSL's performance across its business segments showed mixed results:

The Digital Technologies segment saw notable improvement in EBIT margin, expanding by 388 basis points quarter-on-quarter.

Geographic Distribution

The United States remains DGSL's largest market, contributing 56% of the business, followed by the UK and Europe at 21%, India at 15%, and the rest of the world at 8%.

Financial Position

As of September 30, 2025, DGSL maintained a strong balance sheet with net cash and investments of Rs. 509.4 crores. The company's billed DSO (Days Sales Outstanding) improved to 55 days from 57 days in March 2025.

Future Outlook

Ankush Akar, SVP and Chief Financial Officer, stated, "We remain confident of maintaining our performance trajectory." The company expects mid-teens growth for the full year, including acquisitions.

DGSL continues to invest Rs. 40-50 crores annually in AI and emerging technologies, focusing on building accelerators, platforms, and AI-augmented solutions across its business lines.

While the company faces some challenges in its Digital Experiences segment due to client transitions, management remains optimistic about signing new marquee logos and expanding existing customer relationships.

Conclusion

Datamatics Global Services Ltd.'s Q2 FY26 results demonstrate the company's resilience and strategic focus on operational efficiency and innovation. With a strong financial position and continued investments in emerging technologies, DGSL is well-positioned to capitalize on emerging opportunities in AI and digital transformation.

Datamatics Global Services Limited has announced ambitious growth targets, aiming for a 13-15% revenue compound annual growth rate (CAGR) with profit after tax (PAT) growth exceeding 20%. The company plans to achieve these targets through strategic initiatives and leveraging its AI-automation suites.

Key Growth Drivers

Datamatics is banking on its AI-automation suites, TruBot and TruAI, to drive growth. The company is also focusing on securing new enterprise deals in key sectors:

• Banking
• Financial Services
• Insurance
• Manufacturing

Financial Targets

Cash Position and Growth Initiatives

Datamatics maintains a strong cash position of ₹509.00 crores, which it plans to use to support inorganic growth initiatives through FY27. This substantial cash reserve provides the company with flexibility for potential acquisitions and investments in emerging technologies.

Q2FY26 Financial Highlights

The company's recent financial results for Q2FY26 demonstrate progress towards these ambitious targets:

Segment Performance

Datamatics operates in three main segments:

1. Digital Operations: Revenue of ₹272.48 crore with an EBIT margin of 16.70%
2. Digital Experiences: Revenue of ₹64.62 crore with an EBIT margin of 10.80%
3. Digital Technologies: Revenue of ₹153.13 crore with an EBIT margin of 10.80%

The company's focus on AI-powered products and services appears to be yielding results, with strong growth across all segments.

Management Commentary

Rahul Kanodia, Vice Chairman and CEO, stated, "We have continued our growth momentum from the previous quarter to Q2FY26, reporting a consolidated revenue of ₹490.20 crore, an increase of 4.80% QoQ. EBITDA stood at ₹88.80 crore, reflecting a substantial growth of 17% QoQ with EBITDA margin at 18.10%, driven by improved operational efficiencies and continued cost-optimization efforts."

Datamatics' ambitious growth targets and strong financial performance indicate the company's confidence in its AI-driven strategy and market positioning. As the company continues to leverage its technological capabilities and expand its presence in key sectors, investors and industry observers will be closely watching its progress towards these goals.