HCL Technologies (HCLTECH) Q3 24/25 earnings summary

Executive summary

• Celebrated 25 years as a public company, with revenue growing from $166M in 1999 to $13.77B in the last 12 months, and employee count reaching 220,755 as of December 2024.

• Q3 FY25 saw constant currency revenue up 3.8% QoQ and 4.1% YoY, with INR revenue at ₹29,890 Cr and USD revenue at $3,533M; board approved unaudited results and auditors issued unmodified review reports.

• Achieved a total shareholder return CAGR of 20.6% since IPO, with the highest TSR among large-cap India-headquartered IT companies over the last decade.

• Q3 FY25 featured broad-based growth, significant deal wins in AI and digital, and record cash reserves.

• Interim dividend of ₹18 per share, including a special ₹6 dividend, was declared to mark 25 years of public listing.

Financial highlights

• Q3 revenue was $3,533M (₹29,890 Cr), up 3.8% sequentially and 4.1% YoY in constant currency; net profit for Q3 FY25 was ₹4,594 Cr.

• Operating margin (EBIT) reached 19.5%, up 93 bps QoQ, with EBIT at $690M (₹5,821 Cr) and net income at $544M (₹4,591 Cr), both all-time highs.

• Services revenue grew 2.2% QoQ and 4.9% YoY; software revenue grew 18.7% QoQ but declined 2.1% YoY.

• Free cash flow (LTM) was $2,716M, with FCF/NI at 134%; cash and cash equivalents stood at ₹7,966 Cr as of Dec 31, 2024.

• EPS for Q3 FY25 was ₹16.94, with LTM EPS at ₹62.91, up 8.7% YoY; dividend payout for the year at INR 60/share, distributing 95.2% of net income.

Outlook and guidance

• FY25 revenue growth guidance revised to 4.5%-5% YoY in constant currency, including HPE CTG acquisition impact; EBIT margin guidance at 18%-19%.

• Q4 expected to be softer due to project completions and planned rundown in a mega telecom deal; ramp-up in new discretionary deals will only partially offset.

• Pipeline remains near all-time high, with strong momentum in small deal conversions and AI-led opportunities.

• Board declared a special dividend to celebrate 25 years of public listing, indicating confidence in future performance.