TCS Q3 net profit falls 14 pc annually, declines over 11.5 pc sequentially
- Posted: January 13, 2026
- Updated: 12:46 am
Mumbai, Jan 12 : Indiaâ??s largest IT services company, Tata Consultancy Services (TCS), on Monday reported a 13.9 per cent year-on-year (YoY) fall in its consolidated profit for the third quarter of the current financial year (Q3 FY26).
The IT firmâ??s consolidated net profit declined to Rs 10,720 crore, compared to Rs 12,444 crore in the same quarter last financial year (Q3 FY25), according to an exchange filing.
On a quarter-on-quarter basis, profit dropped 11.6 per cent from Rs 12,131 crore in the September quarter of FY26.
â??The growth momentum we witnessed in Q2 FY26 continued in Q3 FY26. We remain steadfast in our ambition to become the worldâ??s largest AI-led technology services company, guided by a comprehensive five-pillar strategy,â?? K Krithivasan, Chief Executive Officer and Managing Director, said.
â??Our AI services now generate $1.8 billion in annualised revenue, reflecting the significant value we provide to clients through targeted investments across the entire AI stack, from Infrastructure to Intelligence,â?? Krithivasan added.
Despite the profit decline, TCS recorded a nearly 5 per cent rise in revenue, which increased to Rs 67,087 crore from Rs 63,973 crore a year ago.
Sequentially, revenue grew by about 2 per cent. In constant currency terms, revenue growth stood at 0.8 per cent.
The company said its profit was impacted mainly due to exceptional items booked during the quarter.
These included provisions related to the new labour codes, legal claims, and restructuring expenses.
TCS provided Rs 2,128 crore towards the statutory impact of the new labour codes. This included Rs 1,816 crore for gratuity and Rs 312 crore for long-term compensated absences.
The company said these provisions arose mainly due to changes in the wage definition under the new labour rules.
In addition, TCS set aside Rs 1,010 crore for a legal claim filed by Computer Sciences Corporation (CSC) in 2019.
The case, filed in a US court in Texas, alleges that TCS misappropriated trade secrets and confidential information belonging to CSC.
Because of these one-time charges, TCSâ??s bottom line came under pressure during the quarter, even as its business continued to show stable revenue growth.
/IANS
