India’s largest IT services company, Tata Consultancy Services (TCS), just released its financial results for the fourth quarter of FY25. While the firm crossed the impressive milestone of $30 billion in annual revenue, Q4 numbers point to a cautious road ahead.
The TCS share price, already down 10% in a month, remains volatile. With macroeconomic headwinds, a salary hike delay, and slowing discretionary spending by clients, investors are wondering: is now a good time to buy TCS?
Let’s break it down.
How did TCS perform this quarter?
TCS reported a net profit of ₹12,224 crore for Q4 FY25, a 1.7% decline from ₹12,434 crore a year ago. On a sequential basis, too, profit fell 1.3%.
However, revenue during the same quarter grew to ₹64,479 crore, showing a 5.3% YoY increase and 0.8% growth QoQ. In dollar terms, though, revenue saw a 1% decline QoQ, at $7.465 billion.
Here’s a quick breakdown:
| Metric | Q4 FY25 | Change (YoY) | Change (QoQ) |
| Revenue (₹) | ₹64,479 crore | +5.3% | +0.8% |
| Revenue ($) | $7.465 billion | +1.4% | -1.0% |
| Net Profit | ₹12,224 crore | -1.7% | -1.3% |
| EBIT | ₹15,601 crore | -0.6% | -0.36% |
Despite the profit dip, TCS proposed a final dividend of ₹30 per share, continuing its strong shareholder payout record.
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What’s causing the slowdown?
TCS blamed macro uncertainties, particularly around tariff wars and potential recession in the US, for the underwhelming Q4.
Clients are slowing down on discretionary spending, especially in North America and Europe. Growth in these regions was either flat or negative, while India showed a robust 8.2% growth QoQ.
Regional Growth Snapshot (QoQ):
- India: +8.2%
- North America: -1.5%
- UK: -4%
- EU: -6.4%
- APAC: -4.2%
How’s TCS managing its workforce?
TCS made headlines by postponing salary hikes for FY26—a move not seen since the pandemic. The leadership cited uncertainty in client budgets and project pipelines as the reason. Still, hiring remains strong.
- Added 625 new employees in Q4
- Closed FY25 with a net addition of 6,433 employees
- Plans to hire 42,000 freshers in FY26
- Maintained attrition at 13.3%, only slightly up from last quarter
Quarterly variable pay, however, remains in place—70% of employees received full payout.
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What’s keeping analysts hopeful?
Despite the muted quarter, analysts remain cautiously optimistic.
- Emkay Global cut its earnings estimates by up to 3% due to short-term risks but retained an ‘Add’ rating, reducing the target price to ₹3,500.
- Choice Broking kept its ‘Buy’ rating, expecting 7.2% revenue CAGR, and 10.7–10.8% CAGR in EBIT and PAT over FY25–FY27, with a target price of ₹3,950.
While they agree near-term pressure is real, TCS’s long-term strengths—like its AI and digital offerings, strong TCV (total contract value), and customer stickiness remain intact.
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Key wins and AI-led transformation
Despite short-term pressure, TCS is doubling down on AI and cloud.
Noteworthy highlights:
- Crossed $30.18 billion in annual revenue
- Q4 TCV hit $12.2 billion, the highest in FY25
- Partnered with Google Cloud for AI innovation
- Rolled out agentic AI in enterprise platforms like WisdomNext™ and Crystallus™
- Delivered ERP transformations and AI-led automation for clients in aviation, telecom, finance, and manufacturing
| Annual Performance FY25 | Value |
| Total Revenue | ₹2,55,342 crore |
| Net Profit | ₹48,553 crore |
| Total Workforce | 607,979 |
| Free Cash Flow | $5.49 billion |
| Shareholder Payout | $5.26 billion |
| Total Contracts Won (FY25 TCV) | $39.4 billion |
So, should you invest in TCS today?
The TCS share price, currently at around ₹3,257.90, has dropped:
- -10% in 1 month
- -20% in 3 months
- -24% in 6 months
- -18% over 1 year
- +84% over 5 years
In short: Short-term turbulence, long-term potential.
If you’re looking for a quick trade, TCS may not be your stock. But if you believe in the future of AI-led digital transformation, TCS still holds strong fundamentals.
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Final thoughts
TCS Q4 FY25 results show that even industry giants aren’t immune to global volatility. But instead of pulling back, the company is investing heavily in AI, automation, and next-gen services.
The key takeaway is this: watch how companies respond during uncertain times—that’s where long-term value is built.
TCS might not be sprinting right now. But it’s gearing up for a marathon.
