LTIMindtree Q1 results: Net profit down by 1.5%, revenue increases by 5%

The company's first-quarter performance beat revenue but missed net profit estimates of Bloomberg

India’s sixth largest IT services firm LTIMindtree on Wednesday reported a net profit of Rs 1,135 crore for the first quarter of the current financial year (Q1FY25), down 1.5 per cent year-on-year. On a sequential basis, the profit grew by 3.1 per cent.

Revenue for the quarter increased 5 per cent Y-o-Y at Rs 9,142.6 crore. On a sequential basis, the firm’s revenue grew 2.8 per cent.

The company’s first-quarter revenue performance beat Bloomberg estimates but missed out on net profit. Bloomberg had estimated revenue to be at Rs 9,074.6 crore and PAT at Rs 1,161.2 crore.

Like its larger peers, the company management said that the macro environment remained unchanged. However, they do see some early signs of green shoots.

“Though the market environment remains unchanged, we see some green shoots of recovery. Clients continue to focus on efficiency via cost take-out and vendor consolidation deals. However, we are seeing early signs of customers deploying the savings at additional budgets towards kicking off high priority transformation projects,” said Debashis Chatterjee, CEO & MD, LTIMindtree.

The company signed a total contract value worth $1.4 billion. This was similar to the last quarter. The management, however, stated that the deals that were signed in the earlier quarters were ramping up well.

Clients that are kicking off investment are from Banking, Financial Services and Insurance (BFSI), technology, media and communications segments, Chatterjee said.

In terms of growth drivers, the US, which is the largest geography for the company, was up 6.4 per cent Y-o-Y and 4.4 per cent sequentially. Europe was down 1.7 per cent Y-o-Y but grew 1 per cent Q-o-Q. The rest of the world was down 7.5 per cent Y-o-Y.

Among verticals, BFSI was down 2.7 per cent Y-o-Y and grew 2.9 per cent Q-o-Q. Manufacturing and resources (10.5 per cent Y-o-Y) and technology, media and communications (11.9 per cent Y-o-Y) were the growth drivers.

The Ebit margin for the quarter came in at 15 per cent, up from 14.7 per cent in the preceding quarter.

The company said that there were about 150 engagements currently going on in the AI and GenAI segment. Of the top 100 clients, almost 85 per cent of them are doing something in AI, it said.

Chatterjee said the momentum on adopting AI was very strong.

The company’s headcount for the quarter was at 81,934 while the attrition came in at 14.4 per cent. The firm added over 1,000 freshers during the quarter.

 The company also announced that the board had approved the setting up of a wholly-owned subsidiary in Brazil with an investment of $1 million.