Tata Consultancy Services (TCS) reported a strong sequential performance for the March quarter, with profit rising sharply and revenue showing steady growth, supported by robust deal wins and improving execution.

India’s largest IT services company posted a 29% quarter-on-quarter jump in net profit at ₹13,718 crore, compared with ₹10,657 crore in the December quarter, according to its exchange filing.

Revenue for the quarter came in at ₹70,698 crore, up 5.4% QoQ, while EBIT rose 5.8% sequentially to ₹17,870 crore, indicating stable operating performance despite macro headwinds.

Deal wins drive growth; FY TCV at $40.7 billion

TCS said the quarter marked its third consecutive period of sequential growth, supported by strong deal wins and execution. The company reported a total contract value (TCV) of $12 billion for the quarter, taking FY26 TCV to $40.7 billion, among the highest ever.

“We are pleased to report the third consecutive quarter of sequential growth, supported by three mega deals and a $12 billion TCV,” CEO K Krithivasan said.

He added that the momentum was “broad-based across major markets and most industries”, even as macroeconomic headwinds persist.

AI-led demand strengthens; margins steady

Operating margin for the quarter stood at 25.3%, broadly stable sequentially, while net margin came in at 19.4%.

The company indicated a strong traction in artificial intelligence, with annualised AI revenue crossing $2.3 billion in Q4FY26, driven by enterprise adoption and large-scale deployments.

Krithivasan said “sustained customer conviction in technology investments” continues to support growth visibility, positioning the company well for future opportunities.

Salary hikes effective April 1

The company said it has implemented annual salary increases across all grades effective April 1, while continuing to invest in building an AI-ready workforce.

The board also recommended a final dividend of ₹31 per share, subject to shareholder approval. For FY26, total shareholder payout stood at ₹39,571 crore.

For the full year, TCS reported revenue of ₹2.67 lakh crore, up 4.6% year-on-year, with margins expanding to their highest levels in four years.

Management indicated that while macro uncertainties continue, demand remains resilient across key areas such as cloud, AI and digital transformation.

Shares of TCS ended 1.2% higher at ₹2,590 on the NSE on Thursday, but the stock is still down over 20% in the past year, sharply underperforming the Nifty IT index, which has fallen about 1% over the same period.