Hexaware Technologies slides after Q2 profit declines 6.1% QoQ

Hexaware Technologies dropped 7.14% to Rs 574.15 after the company reported its financial results for the quarter ended 30 June 2026 (Q2 CY26).

The company's reported profit declined 13.0% year-on-year to Rs 330.2 crore in Q2 CY26 from Rs 379.7 crore in Q2 CY25. On a sequential basis, profit fell 6.1% from Rs 351.6 crore in Q1 CY26.

Revenue increased 17.9% year-on-year to Rs 3,845.2 crore in Q2 CY26 from Rs 3,260.7 crore in Q2 CY25. On a sequential basis, revenue rose 6.4% from Rs 3,613.0 crore in Q1 CY26. In constant currency terms, revenue grew 6.3% YoY and 4.4% QoQ.

Profit before tax stood at Rs 440.7 crore in Q2 CY26, down 6.8% QoQ and 5.9% YoY.

Reported EBITDA declined 1.6% YoY to Rs 555.2 crore in Q2 CY26 from Rs 564.4 crore in Q2 CY25. On a sequential basis, EBITDA fell 6.3% from Rs 592.5 crore in Q1 CY26. EBITDA margin contracted to 14.4% from 17.3% in the year-ago quarter and 16.4% in the previous quarter.

Employee benefits expense increased 18.8% YoY to Rs 2,266.4 crore, while other expenses rose 2.6% YoY to Rs 973.5 crore. Finance costs increased 56.9% YoY to Rs 32.8 crore, while depreciation and amortisation expense rose 8.6% YoY to Rs 81.7 crore.

The company reported a tax expense of Rs 110.5 crore in Q2 CY26, up 24.7% YoY from Rs 88.6 crore in Q2 CY25.

Net cash generated from operating activities stood at Rs 392.8 crore in H1 CY26, down 13.9% from Rs 456.5 crore in H1 CY25. The company reported an LTM operating cash flow-to-reported profit ratio of 124.7% and cash and cash equivalents of $176 million as of 30 June 2026.

During the quarter, the company added one client in the $20 million-plus category, taking the total to 16. Closing headcount increased by 708 employees sequentially to 34,506, while voluntary IT attrition stood at 11.2% and IT utilisation was 84.8%.

Across verticals, healthcare and insurance revenue grew 18.9% YoY, manufacturing and consumer 17.9%, banking 10.8%, financial services 1.4% and technology, products and platforms 4.5%, while professional services declined 3.4% and travel and transportation fell 14.5%. Geographically, Asia Pacific grew 24.8% YoY, Europe 10.9% and the Americas 3.5%.

CEO R. Srikrishna said the company delivered strong growth in a challenging quarter for the industry while continuing to expand its AI offerings. CFO Vikash Jain said the company achieved industry-leading revenue growth, margin expansion and solid cash conversion despite the successful ERP go-live during the quarter.

Hexaware Technologies is a global digital and technology services company.

Powered by Capital Market - Live News