By Sai Ishwarbharath B and Haripriya Suresh
BENGALURU, July 10 (Reuters) - India's Tata Consultancy
Services reported lower-than-expected first-quarter
revenue on Thursday as clients of the $283 billion Indian IT
sector stayed cautious amid tariff-related uncertainty.
Consolidated sales at India's largest IT services firm by
revenue rose 1.3% year-on-year to 634.37 billion rupees ($7.40
billion) in the June quarter against analysts' average
expectation of 646.66 billion rupees, as per data compiled by
LSEG.
Uncertainty around U.S. tariffs has quashed IT companies'
hopes of a revival in client confidence and spending in its
biggest market. A survey in May showed two in five tech
executives had deferred discretionary projects.
"The continued global macro-economic and geo-political
uncertainties caused a demand contraction," TCS CEO K
Krithivasan said.
TCS is the first Indian tech major to report results. Rival
HCLTech reports next week, while Infosys the
week after that.
Last month, IT bellwether Accenture's ( ACN ) shares dropped
as much as 6% after it reported tepid deal-booking numbers in
its quarterly results.
TCS's revenue in four out of its six verticals fell compared
to the same period last year, while banking and financial
services' revenue grew 1% and tech services rose 1.8%.
Its total order bookings stood at $9.4 billion during the
quarter, from $12.2 billion in the previous quarter and $8.3
billion in the year-ago period.
"Deal wins remained muted, with client losses in larger
contracts and flattish margins," said Sagar Shetty, research
analyst at StoxBox.
"While green shoots in banking and tech verticals offer some
respite, softness in U.S. and Europe raises demand concerns," he
said.
TCS's net profit rose 6% in the three-month period to 127.60
billion rupees against analysts' estimate of 122.16 billion
rupees. The profit beat was largely because of a wage hike delay
and a jump in other income.
Its shares listed in Mumbai closed 0.1% lower ahead of the
results.
($1 = 85.6690 Indian rupees)
(Reporting by Sai Ishwarbharath B and Haripriya Suresh; Editing
by Janane Venkatraman and Mrigank Dhaniwala)