TCS Q1 FY27 Preview: Revenue seen at Rs 72,012 crore, profit may dip 2.4%; dividend announcement likely

India's largest IT services company, Tata Consultancy Services (TCS), is expected to report a mixed set of earnings for the first quarter of FY27, with revenue likely to grow while profit and margins may decline.

According to Zee Business research, revenue for the June quarter is estimated at Rs 72,012 crore, up 1.9 per cent from Rs 70,698 crore reported in the March quarter. In dollar terms, revenue is expected at USD 7.60 billion, marginally lower than USD 7.62 billion, reflecting a 0.3 per cent quarter-on-quarter decline.

EBIT is estimated at Rs 17,137 crore, down 4.1 per cent from Rs 17,870 crore in the previous quarter. EBIT margin is expected to decline to 23.8 per cent from 25.3 per cent.

Net profit is projected at Rs 13,392 crore, down 2.4 per cent from Rs 13,718 crore reported in the March quarter. The company is also expected to report a total contract value (TCV) of USD 8-10 billion during the quarter.

Key factors expected to influence performance

A weaker rupee is expected to support revenue growth during the quarter. However, higher investments in artificial intelligence (AI) are likely to offset part of the currency benefit and weigh on margins.

Improved efficiency and productivity are expected to support business performance, while the banking, financial services and insurance (BFSI) segment is likely to remain a key growth driver.

Margins may also be impacted by the salary hike implemented from April. In addition, weak economic conditions in the Middle East are expected to affect business performance.

The acquisitions of Coastal Cloud and ListEngage are expected to support the company's medium-term growth strategy.

Investors will closely watch the management's commentary on the demand environment, AI-related deal wins, revenue outlook and large deal pipeline.

Results, dividend decision and conference call

TCS will announce its first-quarter FY27 results after market hours on Thursday, July 9. The company will also host an earnings conference call at 7:00 pm IST, during which the management will discuss the financial performance and respond to analysts' questions.

The company's board will also consider the declaration of an interim dividend for equity shareholders.

If approved, the interim dividend will be paid to shareholders whose names appear in the company's register of members or in the records of the depositories as beneficial owners on Wednesday, July 15, 2026, which has been fixed as the record date.

March quarter performance and workforce

TCS had reported a 12.22 per cent year-on-year rise in consolidated net profit at Rs 13,718 crore for the March quarter. Revenue from operations increased 9.64 per cent to Rs 70,698 crore during the quarter.

For the full FY26, the company's net profit rose 1.35 per cent to Rs 49,210 crore, while revenue increased 4.58 per cent to Rs 2.67 lakh crore.

The operating profit margin improved to 25.3 per cent in the March quarter from 24.2 per cent a year earlier.

The company added 2,356 employees during the March quarter, taking its total workforce to 5,84,519 as of March 31, 2026. It was the first quarter of net employee addition after two consecutive quarters of decline.

However, the overall employee count fell by 23,460 during FY26. During the year, the company also began an exercise to reduce around 12,000 jobs amid changes in the technology landscape and increasing adoption of AI.

Stock performance ahead of earnings

Shares of TCS were trading at Rs 2,082.30, down Rs 13.80 or 0.66 per cent on Wednesday.

The stock has declined by Rs 1,407.60, or about 40.3 per cent, from its 52-week high of Rs 3,489.90 touched on July 2, 2025. It is currently Rs 105.50, or about 5.3 per cent, above its 52-week low of Rs 1,976.80 hit on July 1, 2026.

TCS has a market capitalisation of Rs 7.53 lakh crore and is part of the Nifty 50 index.

The stock has gained 5 per cent over the past week but has declined 3.24 per cent over the last month. On a year-to-date basis, it has fallen 35.5 per cent, compared with a 7.44 per cent decline in the Nifty 50 index.