Firstsource Solutions (FSL) Q2 25/26 earnings summary

Executive summary

• Q2 FY26 revenue reached ₹23,122 million ($265M), up 20.1% year-over-year, marking the sixth consecutive quarter of double-digit growth and seventh straight quarter of sequential growth.

• EBIT margin expanded to 11.5% in Q2 FY26, with profit after tax at ₹1,795 million (7.8% margin), and diluted EPS of ₹2.54.

• Four large deals were signed in Q2, expanding into new verticals and geographies, with a deal pipeline exceeding $1 billion ACV.

• Strategic investments made in Applied AI and Lyzr, and a proposed acquisition of Pastdue Credit Solutions in the UK is pending regulatory approval.

• Recognized with multiple industry awards for innovation, ESG, workplace excellence, and mortgage transformation.

Financial highlights

• Q2 FY26 EBIT was ₹2,665 million (11.5% margin), up 28.1% year-over-year; PAT at ₹1,795 million, up 29.9% year-over-year; EPS (diluted) at ₹2.54.

• H1 FY26 revenue was ₹45,299 million ($524M), up 21.9% year-over-year; H1 EBIT margin at 11.4%.

• Free cash flow to PAT ratio was 117% for Q2 and 155% for H1; cash balance at ₹2,900 million.

• Net debt reduced to ₹10,800 million as of September 30, 2025; long-term debt at ₹3,552 million, short-term debt at ₹10,217 million.

• EBITDA margin in Q2 FY26 at 16.3%, up 140bps year-over-year.

Outlook and guidance

• FY26 constant currency revenue growth guidance is 13–15%, with EBIT margin guidance of 11.25–12%.

• Accelerated growth expected in H2 FY26, supported by large deal ramp-ups and headcount additions.

• Guidance excludes Pastdue Credit Solutions and does not factor in unforeseen macro changes.