HCL Technologies Limited announced its Q3FY26 financial results for the quarter ended December 31, 2025, demonstrating solid revenue growth despite facing regulatory headwinds. The IT services major reported consolidated revenue of ₹33,872 crores, marking a 13.3% increase from ₹29,890 crores in the corresponding quarter of the previous year.

Financial Performance Overview

The company's financial performance for Q3FY26 was significantly impacted by regulatory changes, with net profit declining to ₹4,082 crores compared to ₹4,594 crores in Q3FY25. This decrease was primarily attributed to a one-time exceptional charge of ₹956 crores related to the implementation of New Labour Codes.

Segment-wise Performance

The company's three business segments showed varied performance during the quarter. IT and Business Services remained the largest contributor, while Engineering and R&D services demonstrated strong growth momentum.

The Engineering and R&D services segment posted the highest growth rate at 18.3%, while HCL Software segment showed consistent performance with 12.3% growth.

Nine-Month Performance

For the nine months ended December 31, 2025, the company reported consolidated revenue of ₹96,163 crores, representing a 10.8% increase from ₹86,809 crores in the corresponding period of the previous year. Net profit for the nine-month period stood at ₹12,162 crores compared to ₹13,090 crores in the previous year.

Regulatory Impact and Dividend Declaration

The implementation of New Labour Codes effective November 21, 2025, resulted in a one-time increase in employee benefit provisions. This regulatory change led to an exceptional charge of ₹956 crores for the consolidated entity and ₹948 crores for the standalone company.

Despite the regulatory impact, the Board of Directors declared an interim dividend of ₹12.00 per equity share of ₹2.00 each for FY2025-26. The record date for dividend payment is January 16, 2026, with the payment date scheduled for January 27, 2026.

Strategic Acquisitions

The company announced two significant acquisitions to strengthen its market position:

The Telco Solutions acquisition will enhance the company's Engineering and AI-led Network propositions for Global Communication Service Providers, while the Jaspersoft acquisition will add comprehensive business intelligence and reporting capabilities.

Operational Metrics

The company's operational efficiency remained stable with total expenses of ₹27,792 crores in Q3FY26 compared to ₹24,235 crores in Q3FY25. Employee benefits expense increased to ₹18,867 crores from ₹16,576 crores, reflecting both business growth and the impact of New Labour Codes.

The results demonstrate HCL Technologies' resilience in maintaining revenue growth momentum while navigating regulatory changes and continuing its strategic expansion through targeted acquisitions.

HCL Technologies Limited announced its Q3FY26 financial results for the quarter ended December 31, 2025, demonstrating strong revenue growth despite facing regulatory headwinds that impacted profitability. The IT services major reported mixed performance with robust top-line expansion offset by one-time regulatory costs.

Financial Performance Overview

The company delivered solid revenue growth across its operations during the third quarter. Consolidated revenue from operations reached ₹33,872 crores, marking a significant 13.3% year-over-year increase from ₹29,890 crores in Q3FY25. Sequential growth was also strong at 6.0% compared to ₹31,942 crores in Q2FY26.

Impact of New Labour Codes

The quarter's profitability was significantly affected by regulatory changes implemented by the Government of India. Effective November 21, 2025, new Labour Codes consolidated multiple existing labour legislations into a unified framework. This resulted in a one-time exceptional charge of ₹956 crores for the consolidated entity and ₹948 crores for the standalone company, recognized as employee benefit expenses under Ind AS 19 requirements.

Without this exceptional item, profit before tax would have been ₹6,465 crores compared to the reported ₹5,509 crores. The company noted that the government is still in the process of notifying related rules, and any future impacts will be evaluated and accounted for when notified.

Segment-wise Performance

All three business segments demonstrated strong growth momentum during the quarter:

The Engineering and R&D services segment led growth with an 18.3% year-over-year increase, while HCL Software showed strong recovery with 30.6% sequential growth from ₹2,826 crores in Q2FY26.

Strategic Acquisitions Announced

HCL Technologies announced two significant acquisitions to strengthen its market position:

Telco Solutions Business Acquisition: On December 18, 2025, the company signed a definitive agreement to acquire the Telco Solutions Business from Hewlett Packard Enterprise for ₹1,438 crores ($160 million), including ₹135 crores ($15 million) in performance-based incentives. This acquisition will enhance the company's Engineering and AI-led Network propositions for Global Communication Service Providers.

Jaspersoft Acquisition: On December 22, 2025, HCL signed an agreement to acquire Jaspersoft, a business unit of Cloud Software Group, for ₹2,157 crores ($240 million). Jaspersoft provides embedded analytics and reporting platforms, bringing a comprehensive business intelligence platform and global developer community to HCL's portfolio.

Both transactions are subject to regulatory approvals and customary closing conditions, with completion expected within six months.

Dividend Declaration and Nine-Month Performance

The Board of Directors declared an interim dividend of ₹12.00 per equity share of ₹2 each for FY2025-26. The record date is set for January 16, 2026, with payment scheduled for January 27, 2026.

For the nine months ended December 31, 2025, consolidated revenue reached ₹96,163 crores, up 10.8% from ₹86,809 crores in the corresponding period of FY25. Nine-month net profit attributable to owners was ₹12,154 crores compared to ₹13,083 crores in the previous year, reflecting the impact of the one-time Labour Code charges.