Tata Consultancy Services (TCS), India’s leading IT services company, has reported its Q2 FY26 results on 9th October, 2025, marking a period of steady growth despite facing some challenges in international markets. For the quarter ending September 30, 2025, TCS posted a net profit of ₹12,075 crore, which reflects a modest 1.4% increase compared to ₹11,909 crore from the previous year. However, this performance was slightly below analysts’ expectations, who had forecasted a profit of ₹12,573 crore.
Revenue Growth and Profit Margins
TCS’s revenue from operations rose by 2.4% year-on-year, reaching ₹65,799 crore, up from ₹64,259 crore in Q2 FY25. This result is also a 3.7% sequential growth compared to the previous quarter, with constant currency growth of 0.8%. This sequential revenue increase is particularly notable as it marks the first time in three quarters that the company has achieved constant currency growth after two consecutive declines.
Operating margins saw an improvement, expanding by 70 basis points to 25.2% from 24.5% in the previous quarter, surpassing analysts’ expectations of 24.7%. TCS also reported a healthy net income of ₹12,904 crore, an 8.4% increase year-on-year, with a net margin of 19.6%.
Sector-Wise Performance and Regional Insights
TCS’s performance across its verticals was broad-based, with notable growth in key sectors. The BFSI (Banking, Financial Services, and Insurance) vertical grew by 1.1% quarter-on-quarter in constant currency, while Life Sciences and Healthcare saw a significant 3.4% increase. Manufacturing also performed well, growing by 1.6%, despite facing industry-specific challenges. On the other hand, the TSS (Technology and Services Solutions) and CMI (Communications, Media, and Information) segments showed steady growth, at 1.8% and 0.8% respectively.
Revenue from North America, TCS’s largest market, declined slightly by 0.1%, while the United Kingdom and Continental Europe saw more significant drops of 1.9% and 3%, respectively. In contrast, the Asia Pacific region grew by 2%, indicating a more positive outlook in this area.
Strong Deal Wins and Strategic Acquisitions
One of the key highlights of TCS’s Q2 FY26 performance is its strong deal wins. The company secured a total contract value (TCV) of $10 billion during the quarter, up from $9.4 billion in Q1 FY26 and $8.6 billion in Q2 FY25. This reflects a solid demand for TCS’s services, particularly in the areas of digital transformation, data management, and cloud computing.
In addition to its strong revenue and deal wins, TCS made strategic moves to further solidify its position in the technology sector. The company announced the acquisition of ListEngage, a leader in Salesforce solutions, for a total consideration of $72.8 million. This acquisition is expected to accelerate TCS’s growth in the cloud and CRM (Customer Relationship Management) services space.
AI and Digital-First Strategy
TCS has also been investing heavily in building a robust AI-driven infrastructure to maintain its competitive edge. The company’s ongoing efforts in nurturing an AI-first culture were highlighted by the world’s largest ‘Ideate and Build with AI’ hackathon, which attracted 275,000 participants. These initiatives signal TCS’s long-term vision to integrate artificial intelligence and digital solutions into its services, ultimately aiming to become the world’s largest AI-led technology services company.
Dividend and Future Outlook
As part of its Q2 FY26 results, TCS announced an interim dividend of ₹11 per share, which will be paid to shareholders on November 4, 2025, with the record date set for October 15, 2025. The company’s strong cash flow from operations, at 110.1% of net income, reinforces its solid financial health and capacity to reward its investors.
Looking ahead, TCS remains committed to driving further growth through its strategic investments in AI and digital services. While international markets may pose challenges in the short term, TCS’s diverse service offerings and growing order pipeline suggest that the company is well-positioned for sustained growth in the coming quarters.
TCS’s Q2 FY26 results reflect a strong, resilient performance, marked by solid revenue growth, improved profitability, and a commitment to future-ready technologies like AI and cloud services. Despite facing headwinds in some international markets, the company’s continued focus on innovation and strategic acquisitions positions it well for long-term success.
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