Tech Mahindra reported a 23.2% rise in net profit to $166 million for the September quarter, backed by a 6.8% revenue increase to $1.6 billion. The company declared an interim dividend of Rs 15 per share. While deal momentum remains robust with $1 billion in new contracts, investors may monitor the manufacturing segment, which recorded a 3.9% sequential decline.
Tech Mahindra reported its financial results for the September quarter, showing a 23.2% year-on-year increase in net profit to $166 million. Revenue reached $1.6 billion, marking a 6.8% growth compared to the same period last year. Following the performance, the company board declared an interim dividend of Rs 15 per share.
The company highlighted operational efficiency, achieving an EBIT margin of 14.8%. This marks the twelfth consecutive quarter of margin expansion, suggesting that internal productivity improvements and strategic investments in AI are contributing to the company's bottom line. In the IT services sector, where wage costs and operational overheads are significant, sustaining such margin growth is often a primary metric for investors to track.
Deal momentum remained a steady contributor to the results. Tech Mahindra secured $1 billion in new deal wins during the quarter, marking the fourth consecutive quarter it has achieved this level of contract value. The communication vertical, which forms a significant portion of the total revenue, grew 9.5% year-on-year. Additionally, the retail, logistics, and transport segment performed well with a 9.6% sequential gain.
However, there were areas of softness in the business. The manufacturing segment experienced a 3.9% sequential decline. Investors often watch segment-specific trends to identify if a decline is temporary or reflective of broader demand pressures in a particular industry. Whether this indicates a softening of demand in the manufacturing sector is a point worth watching in upcoming disclosures.
The company increased its workforce by 1,928 employees, reaching a total headcount of 76,617. The last-twelve-month attrition rate remained at 11.7%, a figure that suggests relative stability in retaining talent compared to recent volatile periods for the IT industry. Moving forward, the company's ability to execute on its current $1 billion order book and maintain profit margins while navigating fluctuating demand in sectors like manufacturing will be critical monitorables.