Mumbai, Jul 9 (PTI) India's largest IT services company TCS on Thursday reported a 4.61 per cent increase in its net profit to Rs 13,349 crore for the June 2026 quarter.

In the results, which came amid heightened worries over the growth sustenance in the USD 315 billion domestic IT sector in the age of artificial intelligence, TCS said its net income rose 8.5 per cent year-on-year to Rs 13,849 crore, excluding exceptional items.

From a topline perspective, its Q1 revenues jumped by nearly 14 per cent year-on-year to Rs 72,275 crore, and edged up 2.23 per cent from the March quarter's Rs 70,698 crore.

It reported an annualised AI revenue of USD 2.6 billion, up 13.6 per cent quarter-on-quarter.

Its chief executive and managing director K Krithivasan said the quarter reflects continued growth momentum and the strength of our strategic positioning, despite geopolitical and macroeconomic headwinds.

"As customers accelerate investments in AI, modernisation, cybersecurity, sovereign cloud and platform simplification, our strong deal conversion, improving client mining and expanding ecosystem partnerships position TCS well to translate opportunity into sustained growth," Krithivasan added.

The company said it has bagged USD 9.5 billion of total contract value (TCV) or new deals in Q1, including a USD 800 million AI-led transformation mega deal with SKF.

Its chief operating officer Aarthi Subramanian noted that it signed strategic partnerships with Anthropic and Mistral to expand its AI ecosystem.

From a financial perspective, it reported an operating profit margin of 24 per cent during April-June compared to 25.3 per cent in the preceding quarter, which was expected to go down, given wage hikes and new investments.

The headcount rose by over 9,200 staffers in the three months to June to 5,93,798 employees as of June 30, it said, adding that long-term attrition in the IT services came at 13.6 per cent.

"We continue to invest in AI infrastructure, next-generation skill development platforms, to enable our people to be future ready, while fostering a workplace where every associate feels safe, valued, trusted and empowered to grow," its chief human resources officer Sudeep Kunnumal said.

From a sectoral perspective, all domains reported growth in revenue year-on-year, except the consumer business, and from a geographic perspective, Latin America and the UK reported lower revenues in Q1 FY27 against Q1 FY26.

Its India revenues, which had been on a decline following the culmination of the multi-thousand crore BSNL deal, jumped 22.9 per cent year-on-year and 7.6 per cent quarter-on-quarter.

The company scrip ended the session 0.52 per cent down at Rs 2,047.75 apiece on the BSE on Thursday against a 0.31 per cent jump on the benchmark. PTI AA BAL BAL

AI-led transformation and strong deal wins drive TCS quarterly growth despite margin pressure and mixed geographic performance. TCS reported higher quarterly net profit, revenue and net income for the June 2026 quarter, while operating margin declined due to wage hikes and fresh investments. The company said growth was supported by demand for AI-led transformation, modernisation, cybersecurity, sovereign cloud and platform simplification, and disclosed new deals with a total contract value of USD 9.5 billion, including a major AI-led transformation engagement.