India’s largest IT services company, Tata Consultancy Services (TCS), disclosed a 13.9% year-on-year decline in its consolidated profit for the third quarter of the current financial year (Q3 FY26). The company’s consolidated net profit fell to Rs 10,720 crore from Rs 12,444 crore in the same quarter of the previous financial year (Q3 FY25), as per an exchange filing.
Quarter-on-quarter, TCS experienced an 11.6% decrease in profit, down from Rs 12,131 crore in the September quarter of FY26. K Krithivasan, the Chief Executive Officer and Managing Director, expressed the continuation of growth momentum from Q2 FY26 to Q3 FY26. He emphasized the company’s goal to evolve into the world’s leading AI-driven technology services provider, guided by a comprehensive five-pillar strategy.
Despite the profit downturn, TCS saw a nearly 5% increase in revenue, reaching Rs 67,087 crore compared to Rs 63,973 crore a year earlier. Sequentially, revenue rose by approximately 2%, with a constant currency revenue growth of 0.8%. The profit decline was primarily attributed to exceptional items recorded during the quarter, including provisions related to new labour codes, legal claims, and restructuring expenses.
TCS allocated Rs 2,128 crore for the statutory impact of the new labour codes, covering gratuity and long-term compensated absences. Additionally, the company earmarked Rs 1,010 crore for a legal claim initiated by Computer Sciences Corporation (CSC) in 2019, alleging misappropriation of trade secrets and confidential information. These one-time charges impacted TCS’s bottom line in the quarter, despite stable revenue growth.
