- FY 23 Order Book TCV[1] at $34.1 Bn; Q4 TCV at $10 Bn with all-time high number of large deals
- Full Year Revenue $27.927 Bn, +8.6% YoY[2] (CC[3]: +13.7%)
- Growth led by North America (+15.3%), UK (+15%), India (+14.6%)
- Operating Margin at 24.1%; Net Margin at 18.7%
- Net Income at $5.219 Bn, +1.6% YoY
- K Krithivasan to take over as CEO and MD from June 1,2023.
MUMBAI, April 12, 2023: Tata Consultancy Services (BSE: 532540, NSE: TCS) reported its consolidated financial results according to Ind AS and IFRS, for the quarter and full year ending March 31, 2023.
FY 2022-23: Other Annual Highlights |
Q4 FY 2023: Quarterly Highlights |
· Client metrics: 60 clients in the $100 Mn+ band (+2 YoY), 133 in the $50 Mn+ band (+13 YoY), 291 in the $20 Mn+ band (+23 YoY), 461 in the $10 Mn+ band (+22 YoY) and 1241 in the $1 Mn+ band (+59 YoY) · Employee Metrics: o Net Addition: 22,600 employees o Employee Headcount: 614,795 o Diversity: 150 nationalities; 35.7% women o IT Services Attrition (LTM): 20.1% · Talent Development: o ~6 Mn digital competencies acquired o Number of Contextual Masters at 62,000 · Free Cash Flow: $5.1 Bn · Final Dividend per share (proposed): `24 · Shareholder payout of $5.7 Bn in the form of dividends |
· Revenue at $7.195 Bn, +7.4% YoY (CC: 10.7%) · Growth led by UK (+17%), Retail & CPG (+13%) and Life Sciences and Healthcare (+12.3%) · Operating Margin: 24.5%; Net Margin: 19.3% · Net Income: $1.385 Bn, +5.4% YoY · Strong Cash conversion: Operating Cash Flow 104.1% of Net Income · Net Addition: 821 employees |
Rajesh Gopinathan, Chief Executive Officer and Managing Director, said: “It is very satisfying to look back at our strong growth in FY 2023, on top of the mid-teen growth in the prior year. The strength of our order book demonstrates the resilience of demand for our services and gives us visibility for growth in the medium term. Krithi and I are working closely to ensure that the leadership transition over the next few months is smooth and seamless to all our stakeholders, and that TCS is well positioned to capture the opportunities ahead.”
N Ganapathy Subramaniam, Chief Operating Officer and Executive Director, said: “During Q4 and through the year, we successfully delivered transformation programs of varying size and scale. Cloud and Data continue to generate huge demand both internally from a talent perspective and externally from a solutions point of view. We are embracing AI/ML holistically in our execution methods to leverage the huge data and metrics that we have on our delivery performance over decades, to generate insights and raise the bar on quality and experience to our clients.”
Samir Seksaria, Chief Financial Officer, said: “FY 23 was a year of transition, as supply-side challenges abated while pandemic-depressed travel and discretionary spends normalized. We navigated this change well, without slowing down our investments in our people, research and innovation and intellectual property. Our longer term competitiveness remains intact, giving us industry-leading profitability even as we pursue our growth aspirations.”
Milind Lakkad, Chief HR Officer, said: “As we grow the TCS family, I want to call out the stellar role played by our recruitment team in swiftly scaling up hiring, and onboarding the best available talent, enabling TCS to meet its delivery commitments and capture growth. We are honoring all job offers, and have added 22,600 employees on a net basis in FY 23. During the year, we onboarded over 44K freshers and our highest-ever number of experienced professionals. We also doubled down on organic talent development, obtaining over 53K cloud certifications during the year, bringing the total to over 110K employees certified on hyperscaler platforms. This places us among the top 2 partners for the largest cloud providers.”
Q4 and Full Year Segment Highlights**
Industries: Growth in Q4 was led by Retail and CPG (+13%) and Life Sciences and Healthcare (+12.3%). Other verticals grew in the single digits. Technology & Services grew 9.2%, BFSI grew 9.1%, Manufacturing grew 9.1% and Communications & Media grew 5.3%.
On a full year basis, growth was led by Retail and CPG (+19.7%) and Communications & Media (+14%). All other verticals showed growth in a narrow band around the company average. Technology & Services grew 13.7%, Life Sciences and Healthcare grew 13.3%, Manufacturing grew 13%, and BFSI grew 11.8%.
Markets: Q4 growth was led by UK which grew 17%. North America grew 9.6% while Continental Europe grew 8.4%. Among emerging markets, Latin America grew 15.1%, India grew 13.4%, Middle East & Africa grew 11.3% and Asia Pacific grew 7.5%.
On a full year basis, among major markets, North America grew 15.3%, UK grew 15% and Continental Europe grew 11%. In emerging markets, Latin America grew 17.3%, India grew 14.6%, Middle East & Africa grew 7.8% while Asia Pacific grew 7.6%.
Services: In a challenging environment, clients carefully calibrated spends, prioritizing cost optimization, vendor consolidation and automation initiatives. In-flight technology transformation initiatives continued to be funded but with the expectation of earlier and higher RoI. Growth was led by Cloud, Cyber Security, Enterprise Application Services, and Cognitive Business Operations.
- Consulting & Services Integration, Digital Transformation: Enterprises continue to invest in modern application platforms on the cloud with modernization programs, supply chain and customer experience transformation. There was strong traction for services around Salesforce, Oracle, ServiceNow and Digital Integration. Preconfigured industry solutions built on TCS Crystallus™ are positioning TCS well to drive digital transformation and deliver business value. Clients are seeking an integrated services approach to enterprise security with focus on automation, accuracy and enterprise posture visibility. Privacy enforcements across e-commerce, DevOps and processes is evolving rapidly. TCS Privacy-by-Design framework and Cyber Defense Suite is seeing resonance with global customers. The company saw strong growth in Managed Security Services, IAM and Governance, Risk & Compliance services.
- Cloud Platform Services: Saw strong growth across all industry segments with noticeable traction in application and data modernization for improved user experience and business solutions. With increased focus on cloud adoption, enterprises have accelerated their modernization journey with an emphasis on modular enterprise applications. Clients continue to maximize value from investments in cloud by leveraging AI/ML, data, and cloud native on a hybrid cloud foundation, and adopting stronger Cloud Governance & FinOps.
- Cognitive Business Operations: The trend of vendor consolidation and rationalization continued as customers consolidate services with a strategic partner for better efficiency and resilience. TCS Cognix™ has emerged as a game changer for Operations Transformation, improving throughput, accuracy & user experience. Cognix™ led to multiple large wins in the quarter. Growth this quarter was led by End-to-End Infrastructure & Network Services, Digital F&A, ERP Operations and MFDM™.
** Year on Year Growth in Constant Currency terms
Key Highlights
- TCS has expanded its decade-long partnership with SAS as they continue to transform their business under SAS-FORWARD initiative until 2028. TCS will work with SAS to continue simplifying the landscape by adopting cloud native services and enabling faster time to market. TCS will leverage its industry-leading practices to drive a culture of empowered teams and continuous innovation, helping deliver superior customer experience.
- Selected by IHG Hotels & Resorts, one of the world’s leading hotel companies, to drive enterprise process automation across Finance, Travel Agent Commission, Revenue Compliance & Audit, Revenue Services, Sales, and HR. The program aims to digitize and automate legacy processes to drive efficiencies and cost optimization across the enterprise.
- Selected by ENMAX Corporation, a North American utilities company, to modernize their billing and customer care processes. TCS will implement their digital core on a leading cloud ERP leveraging TCS ConvertCore, including ERP and Cloud platform partners. This will improve the user experience, provide a step-change in system resiliency and set a foundational stage for their digital transformation.
- Selected by an American energy company to enable next gen IT operations and seamless carve out of their clean energy arm with zero disruption. TCS will drive the transformation with MFDM™ powered solutions, ignio™ AIOps, digital workplace services and Cognix™. This will improve productivity and enhance user experience.
- Selected by Bombardier, a global leader in aviation, as the principal strategic partner for their IT and digital transformation that aims to enhance agility. TCS will deploy a unique integrated lifecycle management system on a leading ERP platform. The new state-of-the-art landscape will propel our client's IT operating plans, enabling innovation and maximizing leverage of AI/ML, data and cloud services.
- Selected by a North American energy company, to improve their overall cyber security posture following a recent acquisition. TCS will leverage its Cyber Defense Suite, cyber security tools, engineering services, and Identity & Access Management capabilities to enhance cyber coverage and uplift security, threat detection & response.
- Further strengthening on the long-standing partnership with Singapore Airlines (SIA) of more than two decades, TCS has been awarded a multi-year contract by SIA for application maintenance and support with the aim to harness the multiplier effect of AI/ML for improved efficiencies. This will aid in supporting SIA’s strong digital foundation for enhanced customer experience and more efficient operations.
- Selected by an American data communications and telecom equipment provider, to enable a future-ready operating model with focus on service reliability, business KPI improvements, customer experience and innovation. TCS will positively impact the complete value chain by accelerating cloud adoption leveraging TCS Crystallus™, enabling autonomous workflows & managing the complex technology landscape. This will help the client amplify cross track synergies.
- TCS has expanded its strategic partnership with a large European pharmaceutical company, in the areas of research & development, medicine & regulatory affairs to provide domain & business consultancy, validation & testing and business support services with enhanced ownership for the applications portfolio. TCS will streamline the application lifecycle management at scale enabling customers to focus on core business growth.
- TCS has been selected as the strategic partner for a large insurance company to transform its mission critical systems across multiple lines of business and evolve its operating model to take advantage of the cloud. Through this transformation, the insurer will improve its speed, innovation, business agility and its ability to innovate and increase market share.
- TCS has entered into an agreement with a large global reinsurer for cloud-based Infrastructure transformation. TCS will be responsible for centralizing all cloud consumption, standardizing the operating process and bringing efficiency in usage. TCS will implement service catalogue-based automation using TCS Cloud Exponence™, industry leading FinOps cost management and budget control procedures and MFDM leveraging TCS Cognix™, OneEngine to improve Operational agility, technical debt reduction and cloud value realization.
- Selected by a leading American beverages firm, as the strategic partner to transform their supply chain processes on a leading ERP solution. TCS will design an end-to-end solution covering process and governance for a greenfield implementation to simplify, standardize and maximize automation.
- Selected by a leading German retailer, to support their strategic infrastructure transformation and migration of their global ERP landscape on to a leading hyperscaler cloud platform. This will significantly improve their time-to-market and enhance the customer experience.
- The global enterprise Bayer has chosen TCS as a partner to drive its strategic program (#CORE), that aims to deliver a seamless ONE Bayar experience for its customers, employees and partners. It is a multi-year, Business-led and IT-enabled global program of Bayer that brings all its divisions (Crop Science, Pharmaceuticals and Consumer Health) together to drive end-to-end transformation of business processes and systems.
- TCS has been selected by a global fashion retailer, as the strategic partner to accelerate their AI/Data journey. This includes decommissioning more than 10 legacy platforms, creating a single new modern environment and building a scalable data foundation as the new enterprise data backbone.
