Happiest Minds Technologies (HAPPSTMNDS) Q2 25/26 earnings summary

Executive summary

• Achieved H1 FY26 revenue of $129.5M, up 11.8% in constant currency, with EBITDA margin at 20.8% and PAT up 10.6% YoY, driven by strategic transformations, AI-led initiatives, and strong operating leverage.

• Raised growth commitment to four consecutive years of double-digit revenue growth, reflecting confidence in pipeline and business model predictability.

• 30 new clients added in H1, generating $9M revenue with $50M-$60M potential over three years; strong cross-sell traction.

• Interim dividend of ₹2.75 per share declared for FY26.

• Secured multiple large deals across insurance, healthtech, information services, and retail sectors.

Financial highlights

• H1 FY26 revenue: $129.5M (INR 1,123 crore), up 11.8% YoY in constant currency and 14% in INR; Q2 revenue: $65.2M, up 2.3% QoQ in constant currency and 4.4% YoY.

• EBITDA for H1: INR 244 crore (20.8% margin); Q2 EBITDA margin: 20.2%.

• Operating profit for H1: INR 194 crore (17.3% margin); Q2: INR 97 crore (17% margin); Q2 PAT: ₹5,402 lakhs (9.1% margin), adjusted PAT: ₹6,552 lakhs (11% margin).

• Gross margin improved to 37.2% in Q2 from 36.7% in Q1 and 36% YoY.

• DSO improved to 88 days from 91 days; ROC and ROE steady at 23% and 14%; ROCE at 22.8% and ROE at 13.8% for Q2.

Outlook and guidance

• Reiterated double-digit revenue growth in constant currency and 20%-22% EBITDA margin for FY26.

• Confident of improved Q3 and Q4 performance due to deferred deals and GenAI billing starting.

• Focus remains on AI, cloud, cybersecurity, and data-driven transformation across key verticals, with digital revenue consistently above 97%.

• Strong repeat business (93%) and growing Fortune 2000 client base support future growth.

• Margins expected to remain above 20% despite ongoing investments and salary revisions.