TCS Witness Softness In Long-Term Deals As IT Firms Yields Profit in Q2FY23
Numerous India’s leading IT services firms are considering various cost-cutting measures. Their worry focuses on tightening budgets at recession-wary U.S. and European clients will sharply hit their own profits post the pandemic-led boom
Tata Consultancy Services (TCS) said, after India’s leading IT exporter reported increase in second quarter’s profit beyond expectation, it was witnessing some softness in long-term deal decision making, on 10 October.
The company’s order book stood at 8.1 billion dollar for July-September quarter. It consisted several small and medium-sized deals instead of large ones, said TCS.
Numerous India’s leading IT services firms are considering various cost-cutting measures. Their worry focuses on tightening budgets at recession-wary U.S. and European clients will sharply hit their own profits post the pandemic-led boom.
“Europe is a very uncertain environment,” said Rajesh Gopinathan, Chief Executive-TCS during a press conference.
The Mumbai-based company said that the United Kingdom and Europe were stronger sequentially in the second quarter in its order book, however warned about existence of some “softness” in deal closures in Europe.
TCS is the first one to report results quarterly among its peers or genre, setting the tone for the industry. It has been profiteering from a pandemic-led boom in demand.
The quarterly annualized attrition surged in the second quarter and expects it to “taper down from this point, while compensation expectations of experienced professionals moderate,” TCS added.
The company’s net profit increased by 8.4 per cent to 104.31 billion Indian rupees (1.27 billion dollar) in the quarter ending 30 September as against a year earlier.
Analysts expected an average profit of 102.44 billion rupees. Its revenue generated from operations hiked by 18 per cent to 553.09 billion rupees.