LTM Ltd reported a 1.1% sequential revenue increase to USD 1.235 billion for Q2, supported by a 10 bps expansion in EBIT margins to 15.6%. While AI projects are showing strong momentum with 40% YoY growth, a decline in cash conversion and regional challenges in the Middle East warrant caution. Management remains optimistic for a stronger second half of FY2027.
LTM Ltd Q2 Results: Revenue Hits USD 1.235 Billion
EBIT Margins Expand 10 bps to 15.6%
Reader Takeaway: Strong AI project uptake drives growth, though margin headwinds from one-time items and Middle East volatility persist.
What just happened
LTM Ltd released its Q2 performance data, reporting revenue of USD 1.235 billion, a 1.1% increase sequentially and 5.1% growth year-on-year. EBIT margins improved to 15.6%, a 10 basis point increase from the previous quarter. The company announced a dividend of Rs 0.25 per equity share.
Why this matters
The results signal a strategic pivot toward AI-centric projects, which now account for 13.4% of total revenue. Although the company reported a sequential decline in the Rest of the World region due to Middle East operational issues, management expects a stronger performance in H2. The upcoming acquisition of Randstad Digital remains on track for Q3.
The backstory
In the previous quarter, the company benefited from a one-time gain related to its investment in Voicing.AI. This quarter, the PAT margin declined to 11.7% from 12.7% in Q1, reflecting the absence of those previous one-off gains and increased operational provisions.
Risks to watch
Cash conversion remains a concern, with the operating cash flow to PAT ratio dropping to 39% from 79% in the previous quarter. This was attributed to advance payments and one-time gratuity provisions. Additionally, pricing for traditional services remains under pressure across major segments.
What to track next
Investors should monitor the integration of the Randstad Digital acquisition and whether the company can normalize its cash conversion ratios in Q3. Management’s guidance for the latter half of FY2027 remains the primary indicator for future performance.