LTM profit falls 4.6% as deal wins slow

Operating performance, however, improved slightly, with earnings before interest and tax (Ebit) rising 2.2% sequentially to Rs 1,838 crore. Ebit margin expanded by 10 basis points to 15.6% from 15.5% in the June quarter. The decline in deal wins, by around 25% sequentially, will remain a concern as IT services companies look for stronger signs of a recovery in technology spending. While quarterly deal bookings can fluctuate depending on the timing of large contracts, the fall comes even as LTM seeks to drive growth through artificial intelligence-led services.

Revenue from enterprise AI and business AI grew 47% year-on-year, he said, adding that the company’s technology-domain convergence approach had helped it add a financial services client to its category of customers generating more than $100 million in revenue. Performance across business verticals remained uneven. Banking, financial services and insurance, the company’s largest segment, grew 3% sequentially and accounted for 34.7% of revenue.

Manufacturing, the third-largest vertical, expanded 3.5% and contributed 19.9%. In contrast, the technology and services segment contracted 4.1%, accounting for 19% of revenue. The consumer segment grew a marginal 0.2% and contributed 26.4%. Geographically, North America, which accounted for 74.3% of revenue, grew 1.4% sequentially. Europe registered 0.5% growth and contributed 14.9% to revenue, while the rest of the world declined 1.6% to account for 10.8%.

The number of clients generating more than $5 million in revenue rose by 14 year-on-year to 172, while those generating more than $10 million increased by 16 to 109. The company’s headcount increased by 949 sequentially to 88,835. Attrition remained unchanged at 13.3%, while utilisation stood at 86.4%, also stable from the previous quarter. LTM’s board declared an interim dividend of Rs 25 per equity share, with October 23 set as the record date.