Tata Communications Limited Earnings Summary — Q1 FY2027
Tata Communications Hits Strong Growth Trajectory in Digital and AI-Ready Connectivity Portfolio
Quarterly Business Intelligence
AI Quarterly Scorecard™
Computed deterministically from the last 10 reported quarters.
Quarterly Business Momentum
- Revenue has increased for 5 consecutive quarters.
- Revenue of ₹6,583 Cr is 10.5% higher year-on-year.
- Revenue has compounded at 7.1% annualised over the last 10 quarters.
- Revenue is at its highest level in 10 quarters.
- Net profit of ₹134 Cr is 29.3% below the same quarter last year.
- Profit growth is trailing revenue growth this quarter.
- Net profit has compounded at -32.1% annualised across the period.
- Operating margin stands at 18.7% in Q1 FY2027.
- Operating margin compressed by 38 bps year-on-year.
- Over the last two years operating margin has contracted by 163 bps.
- PBT margin is 3.2%.
- Expenses grew 11.0% against revenue growth of 10.5%.
- Operating profit of ₹1,230 Cr is 8.2% higher year-on-year.
- Operating leverage has been under pressure recently.
- 6 of the last 6 measured quarters delivered year-on-year revenue growth.
- Overall quarterly business momentum scores 55/100 (Healthy) on the latest 10 quarters.
- Business momentum has softened and warrants monitoring.
Quarterly Financials
Last 10 Reported Quarters • All figures in ₹ Crore • Margins in %
| Metric | Trend | Latest Q1 FY2027 | Q4 FY2026 | Q3 FY2026 | Q2 FY2026 | Q1 FY2026 | Q4 FY2025 | Q3 FY2025 | Q2 FY2025 | Q1 FY2025 | Q4 FY2024 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenue | Stable | 6,583 | 6,554 | 6,189 | 6,100 | 5,960 | 5,990 | 5,798 | 5,728 | 5,592 | 5,645 |
| Expenses | Stable | 5,353 | 5,270 | 4,961 | 4,926 | 4,823 | 4,868 | 4,617 | 4,598 | 4,456 | 4,569 |
| Operating Profit | Stable | 1,230 | 1,284 | 1,228 | 1,174 | 1,137 | 1,122 | 1,181 | 1,129 | 1,137 | 1,076 |
| Operating Margin | Stable | 18.7% | 19.6% | 19.8% | 19.2% | 19.1% | 18.7% | 20.4% | 19.7% | 20.3% | 19.1% |
| Other Income | Volatile | -93 | 63 | 183 | -38 | -46 | 926 | -7 | 29 | 85 | -32 |
| Interest | Stable | 186 | 182 | 201 | 202 | 177 | 182 | 187 | 189 | 170 | 186 |
| Depreciation | Stable | 739 | 731 | 751 | 679 | 666 | 672 | 637 | 648 | 634 | 651 |
| Profit Before Tax | Volatile | 211 | 434 | 458 | 255 | 249 | 1,193 | 350 | 321 | 417 | 207 |
| Tax | Volatile | 86 | 183 | 101 | 82 | 65 | 176 | 126 | 98 | 87 | -108 |
| Net Profit | Volatile | 134 | 263 | 365 | 183 | 190 | 1,040 | 236 | 227 | 333 | 321 |
| Net Margin | Volatile | 2.0% | 4.0% | 5.9% | 3.0% | 3.2% | 17.4% | 4.1% | 4.0% | 6.0% | 5.7% |
Key Takeaways
- Digital Portfolio revenue surged 17.1% YoY, now representing over 50% of Data revenue for the first time.
- Data revenue continues to lead overall performance, growing 11.3% YoY to ₹5,708 crore.
- Profitability was impacted by exceptional charges of ₹106.36 crore including staff cost optimization and fire-related damages at a third-party data center.
- Consolidated PAT declined YoY primarily due to these one-off exceptional items and a higher effective tax rate compared to the prior year.
- Normalised EBITDA reached ₹1,281 crore with margins at 19.4%, demonstrating underlying operational resilience.
- Order booking recorded healthy double-digit YoY growth, driven specifically by a strong international pipeline.
- Net debt-to-EBITDA remained disciplined at 1.99x, supported by better working capital management despite capital investments.
- Strategic focus is shifting toward powering enterprise AI at scale via the integrated Network, Cloud, and Interaction fabrics.
Management Guidance
Management remains on track to deliver double-digit EBITDA growth for the full fiscal year. The primary focus is accelerating the 'Network Fabric' business while improving digital profitability and EBITDA-to-cash conversion. Growth momentum in international markets is expected to continue despite geopolitical headwinds in West Asia.
Sentiment Shift
Improving
While statutory profit declined due to one-offs, the underlying operational shift towards digital platforms and AI-ready connectivity is accelerating. The successful transition to new leadership under Ganesh Lakshminarayanan appears to maintain strategic continuity.
Outlook
The company is positioning itself as a core infrastructure provider for AI-led industrial transformations. Outlook is buoyed by robust traction in Multi-Cloud Connect and Managed Secure Edge services, particularly within the India GCC (Global Capability Centre) sector and among global automotive and banking majors.
From the Annual Report (Key Quotes)
“We have started the year well with strong growth across both our core and digital portfolios. We stay on track to deliver double-digit EBITDA growth this year.”
“Our digital platforms are now for the first time trending more than 50% of our data revenue.”
“The real ROI of all AI investments comes when AI is working with enterprise intelligence... we are uniquely poised to capture those trends.”
“As we evaluate the strategic choices, our focus on disciplined capital allocation will continue.”
Official Quarterly Documents
Ask AI about this quarter
This summary is AI-generated from Tata Communications Limited's latest quarterly filing and earnings call. For informational purposes only — not investment advice.