Tata Consultancy Services reported mixed results for the third quarter of fiscal year 2026, with revenue growth offset by exceptional charges that impacted profitability. The IT services giant delivered consolidated revenue of ₹67,087 crore for the quarter ended December 31, 2025, representing a 4.9% year-on-year increase from ₹63,973 crore in the corresponding quarter of the previous year.

Financial Performance Overview

The company's financial performance for Q3FY26 was significantly impacted by exceptional items totaling ₹3,391 crore. Net profit attributable to shareholders declined to ₹10,657 crore compared to ₹12,380 crore in Q3FY25, representing a 13.9% decrease.

Exceptional Items Impact

The quarter was marked by three significant exceptional items that collectively impacted the bottom line by ₹3,391 crore:

• Restructuring expenses: ₹253 crore for the quarter, part of initiatives announced in July 2025
• Statutory impact of new Labour Codes: ₹2,128 crore due to changes in wage definition affecting gratuity and compensated absences
• Provision towards legal claim: ₹1,010 crore related to the ongoing CSC litigation matter

Segment Performance

The Banking, Financial Services and Insurance (BFSI) segment continued to be the largest revenue contributor, generating ₹25,889 crore in Q3FY26 compared to ₹23,481 crore in Q3FY25. Other key segments showed varied performance:

Dividend Declaration and Strategic Moves

The Board of Directors declared a third interim dividend of ₹11 per equity share and a special dividend of ₹46 per equity share, totaling ₹57 per share for Q3FY26. The dividend will be paid on February 3, 2026, to shareholders on record as of January 17, 2026.

During the quarter, TCS completed the acquisition of ListEngage Midco, LLC and its subsidiary for $69 million (₹610 crore), strengthening its Salesforce capabilities. The company also signed a definitive agreement to acquire Coastal Cloud Holdings, LLC for $700 million (₹6,294 crore).

Nine-Month Performance

For the nine months ended December 31, 2025, TCS reported consolidated revenue of ₹1,96,323 crore, up 2.9% from ₹1,90,845 crore in the corresponding period of FY25. Net profit for the nine-month period stood at ₹35,492 crore compared to ₹36,329 crore in the previous year, reflecting the impact of exceptional items totaling ₹4,526 crore during the period.

Tata Consultancy Services announced its Q3FY26 quarterly results for the quarter ended December 31, 2025, showcasing resilient performance despite facing significant exceptional charges. The IT services giant reported consolidated revenue of ₹67,087 crore and declared substantial dividend payouts for shareholders.

Financial Performance Overview

The company's consolidated financial results demonstrate steady growth in core operations. Total income for Q3FY26 reached ₹68,205 crore, comprising revenue from operations of ₹67,087 crore and other income of ₹1,118 crore.

For the nine-month period ended December 31, 2025, consolidated revenue stood at ₹1,96,323 crore compared to ₹1,90,845 crore in the corresponding period of the previous year, representing a growth of 2.87%.

Dividend Declaration

The Board of Directors declared a third interim dividend of ₹11.00 per equity share and a special dividend of ₹46.00 per equity share, totaling ₹57.00 per share. The dividend will be paid on February 3, 2026, to shareholders whose names appear on the register as of the record date of January 17, 2026.

Exceptional Items Impact

The quarter's results were significantly impacted by exceptional items totaling ₹3,391 crore, affecting the company's bottom line performance.

Restructuring Expenses: The company incurred ₹253 crore in Q3FY26 as part of restructuring initiatives announced in July 2025. For the nine-month period, total restructuring expenses amounted to ₹1,388 crore.

Labour Code Impact: TCS recorded ₹2,128 crore as statutory impact following the Government of India's notification of four Labour Codes on November 21, 2025. This impact consists of gratuity provisions of ₹1,816 crore and long-term compensated absences of ₹312 crore, primarily arising from changes in wage definition.

Legal Provision: The company provided ₹1,010 crore towards a legal claim related to the Computer Sciences Corporation case. This provision was made following the Fifth Circuit's decision on November 21, 2025, affirming liability while vacating the previously granted injunction.

Segment Performance

TCS demonstrated balanced performance across its key business verticals during Q3FY26.

Banking, Financial Services and Insurance remained the largest revenue contributor, generating ₹25,889 crore in Q3FY26. The segment also delivered the highest segment result of ₹6,861 crore.

Strategic Acquisitions

TCS completed the acquisition of ListEngage Midco, LLC and its subsidiary ListEngage, LLC on October 10, 2025, for $69 million (₹610 crore). ListEngage is a leading Salesforce summit partner specializing in Marketing Cloud, CRM, Data Cloud, Agentforce, and AI advisory services.

Additionally, the company signed a definitive agreement to acquire 100% stake in Coastal Cloud Holdings, LLC for $700 million (₹6,294 crore). This acquisition will further strengthen TCS's Salesforce consulting capabilities.

Operational Metrics

The standalone results showed revenue from operations of ₹55,567 crore for Q3FY26, with net profit of ₹10,190 crore. Employee benefit expenses for the quarter stood at ₹27,842 crore on a standalone basis and ₹38,530 crore on a consolidated basis, reflecting the company's continued investment in talent.

TCS continues to maintain its position as a leading global IT services provider, demonstrating resilience in navigating regulatory changes and legal challenges while delivering consistent returns to shareholders through substantial dividend distributions.