By Reuters | Updated: April 25, 2024
Bengaluru/April 25 (Reuters) – Tech Mahindra (TEML.NS) India’s fifth-largest software company, reported fourth-quarter revenue below analysts’ estimates on Thursday due to weakness in its communications and media segment as macro headwinds weighed on overall demand.
Consolidated revenue fell 6.2% year-on-year to 128.71 billion rupees ($1.55 billion) in the March quarter. Analysts, on average, expected revenue of 129.55 billion rupees, as per LSEG data.
The communications and media segment, which contributes to a third of its overall revenue, saw a 16.5% decline year on year in the reporting quarter.
Stubbornly high inflation, economic uncertainty and geopolitical risks have pushed clients to cut down on discretionary tech spending. Industry body Nasscom estimated that overall revenue growth in the technology sector more than halved to 3.8% in fiscal 2024.
The Pune-based company’s net profit fell about 41% to 6.61 billion rupees in the fourth quarter, missing analysts’ average estimate of 7.57 billion rupees, according to LSEG data.
Earlier this month, market leader Tata Consultancy Services (TCS.NS) posted a lower-than-expected revenue, although it forecasted a strong deal pipeline to drive growth this fiscal year. Peer LTIMindtree on Wednesday missed the fourth-quarter revenue estimate amid weakness in its banking unit.
The Mahindra group company’s net new deal bookings stood at $500 million, compared to $382 million in the previous quarter and $592 million in the year-ago period.
($1 = 83.3028 Indian rupees)
@ Thomson Reuters 2024
