HCLTech opens FY27 with 20.3% profit growth, record $2.4 billion bookings and a Rs 3,500 crore AI data centre bet
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Commentary & Analysis ·
Verified key facts
- HCLTech's Q1 FY27 net profit rose 20.3% year-on-year to Rs 4,624 crore; revenue grew 13.9% to Rs 34,579 crore
- Dollar revenue came in at $3.65 billion, up 3% year-on-year and 2.6% in constant currency
- Net new bookings hit a record Q1 high of $2.4 billion; quarterly Advanced AI revenue reached $171 million, up 62.1% year-on-year
- The company will invest up to Rs 3,500 crore (about $370 million) to enter the AI data centre business, scaling to 50 MW capacity
- FY27 guidance: 1-4% constant-currency revenue growth and EBIT margin of 17.5-18.5%; interim dividend of Rs 12 per share declared
A double-digit profit quarter to open the year
HCLTech, India's third-largest software services firm, reported June-quarter results on Monday, 13 July 2026, that beat the sombre mood hanging over the sector. Net profit rose 20.3 per cent year-on-year to Rs 4,624 crore, while revenue grew 13.9 per cent to Rs 34,579 crore, LatestLY reported from the company's disclosures.
In dollar terms, the currency in which global clients pay, revenue reached $3.65 billion. That was up 3 per cent from a year earlier and 2.6 per cent in constant currency, according to the company's results statement carried by PR Newswire. The gap between rupee and dollar growth reflects the weaker rupee over the past year.
Operating performance held firm. EBIT grew 18 per cent year-on-year. Excluding restructuring costs, the EBIT margin stood at 17.5 per cent and the net income margin at 13.8 per cent. The board declared an interim dividend of Rs 12 per share, extending one of the sector's longest payout streaks.
Record bookings signal demand is holding
The standout number was new business. HCLTech recorded net new bookings of $2.4 billion, its highest ever for a first quarter. Chief executive C. Vijayakumar highlighted the figure in the results release, with the release noting growth was led by public services, retail and consumer goods, and technology and services clients.
Bookings matter more than usual right now. Global clients have slowed discretionary technology spending, and order wins are the clearest signal of future revenue. A record intake suggests HCLTech is gaining share even in a cautious market.
The AI business is compounding fast
HCLTech put hard numbers on its artificial intelligence franchise. Advanced AI revenue reached $171 million for the quarter, growing 62.1 per cent year-on-year and 10.6 per cent sequentially in constant currency, per the results statement. Revenue per employee, a proxy for AI-led productivity, rose 3.3 per cent to $65,500.
The software arm added its own contribution. HCLSoftware's annualised recurring revenue stood at $1.06 billion, up 2 per cent from a year earlier. The company employs more than 223,000 people across 60 countries.
A Rs 3,500 crore leap into AI data centres
Alongside the results, HCLTech announced its boldest capital commitment in years. The company will invest up to Rs 3,500 crore, about $370 million, to enter the AI data centre business. Capacity is planned to scale to 50 megawatts, positioning the firm to host the graphics-processing infrastructure that AI workloads demand.
The move takes HCLTech beyond services into owning AI infrastructure, a space dominated by hyperscalers and specialist operators. It follows a wave of data centre investment across India, where power availability and rising domestic AI demand have drawn global capital.
The planned capacity would serve AI training and inference workloads from enterprises and government programmes within India. Data residency rules and the push for sovereign computing have turned domestic capacity into a strategic asset. At 50 megawatts, the build is modest by hyperscaler standards but a meaningful diversification for a services firm.
Guidance keeps expectations grounded
For the full year FY27, the company guided for revenue growth of 1 to 4 per cent in constant currency, with services growing 1.5 to 4.5 per cent. The EBIT margin is projected between 17.5 and 18.5 per cent. The conservative range acknowledges continued uncertainty in client spending.
The guidance framework mirrors the caution across the industry. Clients continue to favour cost-takeout programmes over new transformation spending, and decision cycles on large contracts remain long. The services growth band of 1.5 to 4.5 per cent leaves room for both a weak year and a modest recovery. Much depends on how quickly AI projects move from pilots to production.
Key numbers from the quarter at a glance:
- Net profit: Rs 4,624 crore, up 20.3 per cent year-on-year
- Revenue: Rs 34,579 crore, up 13.9 per cent; $3.65 billion in dollar terms
- Net new bookings: $2.4 billion, a Q1 record
- Advanced AI quarterly revenue: $171 million, up 62.1 per cent
- Interim dividend: Rs 12 per share
How it stacks up against peers
HCLTech's report follows Tata Consultancy Services, which opened the earnings season on 9 July. TCS posted a 4.6 per cent rise in net profit to Rs 13,349 crore on revenue of Rs 72,275 crore, with an order book of $9.5 billion, Business Standard reported. HCLTech's profit growth rate comfortably outpaced its larger rival this quarter.
TCS also disclosed an AI benchmark of its own: annualised AI-related revenue of about $2.6 billion, The Tech Portal reported. That is far above HCLTech's stated figure, though the comparison is imperfect because the two companies define AI revenue differently. The disclosures themselves are the story; a year ago, neither firm broke out the number.
The market backdrop remains unhelpful. The IT index fell about 0.7 per cent on Wednesday after IBM issued soft quarterly guidance, reviving worries about global technology budgets. Sector watchers say order books and AI revenue disclosures, not headline profit, will decide how Indian IT stocks are valued through this results season.
Analysts tracking the sector, cited in post-results commentary, view HCLTech's mix of record bookings and infrastructure investment as a hedge. Services growth may stay muted, but AI capacity could open a second revenue engine over the next three years.
Sources
- PR Newswire via The Manila Times - HCLTech delivers robust Q1 led by record deal bookings of $2.4 billion (14 July 2026)
- LatestLY - HCL Technologies Q1 strength battles global headwinds, profit and revenue details (July 2026)
- Business Standard - TCS Q1FY27 results: net profit rises 4.6% to Rs 13,349 crore (9 July 2026)
- HCLTech - Investor relations, quarterly results
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