The Indian IT services sector will kick off the September quarter earnings season next week, starting with Tata Consultancy Services (TCS). The July–September quarter remained challenging, marked by subdued discretionary spending, elongated decision-making cycles, cautious client sentiment amid macroeconomic uncertainty, and disruption from AI-driven technology shifts. The demand environment has neither improved nor worsened.
IT sector Q2 results are expected to stay muted after Q1 was impacted by tariff-related uncertainty. The broader macro backdrop remains weak, further weighed down by the recent H1B visa fee hike announced by US President Donald Trump.
With no material change in operating conditions, analysts expect commentary from IT companies to remain cautious. The trend of mid-tier firms outperforming large-cap players is likely to continue.
Nuvama Institutional Equities expects its coverage universe to report constant currency QoQ growth in the range of -0.5% to +6%. Motilal Oswal Financial Services (MOFSL) echoes this view, noting that clients, grappling with macro and tariff uncertainty, are reluctant to commit sizeable budgets to new initiatives. MOFSL expects QoQ CC revenue growth of 0.3–2.4% for large-caps, while mid-caps are projected to post growth between -0.5% and 6.0%.
For Q2FY26, aggregate revenue for the coverage universe is expected to grow 6.0% YoY, with EBIT and PAT likely to rise 5.2% and 5.5% YoY, respectively (in INR terms).
Here’s a preview of the IT sector Q2 results:
TCS Q2 Preview
TCS, India’s largest software services exporter, is expected to report 2.1% QoQ growth in revenue to ₹64,738 crore in Q2FY26. In USD terms, revenue is estimated to rise 0.2% QoQ to $7,433 million, according to Nuvama. The India business of TCS is likely to remain flat, with the BSNL deal ramp-down completed in Q1.
Net profit is projected to increase 2.3% QoQ to ₹13,058 crore. EBIT is estimated to grow 2.9% QoQ, with margins expected to expand by 20 bps to 24.7%, despite one month of wage hike impact.
Infosys Q2 Preview
Infosys’ revenue is expected to grow 1.8% QoQ in constant currency and 2.1% QoQ in USD terms, with 10–15 bps contribution from acquisitions. EBIT margin is likely to improve by around 20 bps QoQ, aided by operating leverage and currency benefits. Infosys is expected to retain its FY26 revenue growth guidance of 1–3% CC YoY (including 0.4% inorganic) and margin guidance of 20–22%.
HCL Technologies Q2 Preview
HCL Tech is expected to deliver 1.5% QoQ revenue growth in CC terms and 1.7% QoQ in USD terms, led by Products & Platforms (+1.5% QoQ) and Services (+1.7% QoQ). EBIT margin is projected to expand 70 bps QoQ to 17% from 16.3% in Q1, as restructuring expenses ease, according to Nuvama.
HCL Technologies’ revenue is likely to rise 3.5% QoQ to ₹31,396 crore. Net profit may grow 11.3% QoQ to ₹4,275 crore, while EBIT is estimated to increase 8.1% QoQ to ₹5,342 crore.
Wipro Q2 Preview
Wipro’s IT Services revenue is expected to grow 0.1% QoQ in CC terms and 0.2% QoQ in USD terms, near the midpoint of its guidance. Margins are likely to contract 40 bps QoQ to 16.9%. For Q3FY26, Wipro is expected to guide for 0–2% CC QoQ revenue growth, supported by the ramp-up of the Phoenix deal.
Tier-2 IT Sector Q2 Results Preview
Tier-2 IT companies are expected to deliver stronger growth in Q2, with Coforge leading the pack at 6% QoQ in constant currency, followed by Persistent Systems (3.7%), Hexaware Technologies (3.2%), LTIMindtree (1.9%) and Mphasis (1.3%), according to Nuvama.
Among ER&D players, growth is likely to remain modest. L&T Technology Services is expected to post 1.5% QoQ growth, while Cyient may see a muted 0.3% rise, weighed down by weakness in the Auto vertical.
In the smallcap segment, Firstsource is expected to deliver a healthy 2.2% QoQ growth in CC terms. Birlasoft (-0.5%) and Zensar Technologies (-0.1%) are likely to be the only names reporting sequential declines this quarter. Currency impact is expected to remain limited in the range of -10 bps to +30 bps QoQ, Nuvama noted.
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