TCS Profit Beats Estimates In Q3 On Higher Demand For Cloud Computing
TCS and rivals, Infosys and Wipro, have been winning more large contracts from businesses during Q3.
Tata Consultancy Services (TCS) on Friday reported a 7.2 per cent jump in its profit for the final quarter of 2020, as India's top software services firm benefitted from greater demand for its cloud services during the Covid-19 pandemic.
The results kick off India's corporate earnings season for the December quarter, a seasonally weak period for the software industry, but one which analysts reckon has been good for IT firms in 2020 because in part due to the Covid-19 crisis.
TCS and rivals, Infosys and Wipro, have been winning more large contracts from businesses that are investing in services such as cloud-computing and cybersecurity to support their shift to remote work.
“Growing demand for core transformation services ... have driven a powerful momentum that helped us overcome seasonal headwinds,” TCS Chief Executive Officer Rajesh Gopinathan said in a statement to the stock exchanges.
The Mumbai-based company said revenue from the banking and finance industries, its top revenue contributor, jumped 7.6 per cent year-over-year to Rs 166.55 billion ($2.27 billion) in the December quarter.
TCS' net profit rose to Rs 87.01 billion in the three months to December 31, 2020, from Rs 81.18 billion a year earlier. Analysts on average had expected a profit of Rs 84.01 billion, according to Refinitiv data. Revenue from operations jumped 5.4 per cent to Rs 420.15 billion.