India's biggest software services provider reported record orders and hiring numbers on April 11, reflecting demand ahead. Staff churn is the biggest worry
Rajesh Gopinathan, chief executive and managing director of India's largest software exporter Tata Consultancy Services (TCS), speaks during a press conference announcing the Q4 and annual results of the company in Mumbai on April 11, 2022.
Image: Indranil Mukherjee / AFP
Tata Consultancy Services (TCS) reported the highest incremental revenue in the company’s history, announcing its latest earnings results on April 11. Chief executive Rajesh Gopinathan hinted that strong double-digit growth was all but a given for the current year—TCS offers no specific projections—but also warned that the ongoing staff churn in the industry will get worse before it gets better.
Revenues for the year ended March 31, 2022, rose $3.53 billion to $25.7 billion, a 15.4 percent increase over the previous fiscal year, in constant currency. Revenue for the three months ended March 31 rose 14.3 percent in constant currency terms to $6.7 billion, TCS said in a press release. This is a 2.6 percent increase over the $6.5 billion in sales for the December quarter, matching street expectations. In constant currency terms, quarterly revenue rose 3.2 percent.
In a volatile market amid several macro concerns, TCS shares were little changed at close of Mumbai trading on Tuesday.
“Overall the demand environment continues to be very strong,” Gopinathan told reporters in Mumbai on April 11, in the company’s first in-person earnings press conference in two years. “There is a very strong market acceptance, our services are resonating very strongly with the market and the investments we have done are coming through very strongly.”
TCS and other large IT services providers are benefitting from clients prioritising their tech budgets, after the Covid-19 pandemic. Its sales was led by demand in America, the company’s biggest market, and a return to growth among retailers, one of the most affected segment during the worst of the pandemic, and consumer packaged goods businesses.