HCLTech Q2 FY27: Strong Bookings, AI Revenue Surge, Margin Expansion
HCL Technologies reported strong Q2 FY27 results with new bookings at $3.3 billion, up 35% sequentially. Advanced AI revenue reached $219 million, up 28.4% QoQ. EBIT margin improved to 18.2%. The company announced a new partnership with Anthropic. FY27 guidance for revenue growth is 2.5%-4% and EBIT margin is 17.5%-18.5%.
The announcement details strong financial performance, strategic advancements in AI, significant new bookings, and a positive future outlook, all of which are material factors for investors and the company's market position.
The company reported strong financial results including significant growth in bookings and Advanced AI revenue, improved EBIT margins, and positive outlook for FY27. The new partnerships and strategic initiatives also contribute to a positive sentiment.
HCL Technologies Limited has released the transcript of its conference call held on October 12, 2026, following the announcement of financial results for the quarter ended September 30, 2026. The company reported a solid quarter with key highlights including rapidly scaling Advanced AI services, the second-highest new bookings in its history, and significant margin expansion due to disciplined execution and higher-margin Advanced AI revenue.
Services revenue grew 3% sequentially and 4% year-on-year (YoY), with IT and Business Services growing 2.7% sequentially and 4.4% YoY, and Engineering and R&D Services growing 4.1% sequentially and 2.1% YoY. Growth was broad-based across verticals and geographies. Advanced AI revenue reached $219 million, up 28.4% sequentially and 78% YoY, with annualized Advanced AI revenue now at $876 million. Overall revenue grew 2.3% sequentially and 2.6% YoY. Software revenue declined 5.8% sequentially and 11.2% YoY, although its Annual Recurring Revenue (ARR) stood at $1.134 billion, up 7.8% YoY.
EBIT margin was 18.2%, an improvement of 131 basis points sequentially and 71 basis points YoY, driven by higher margins in Advanced AI and operational gains. New deal bookings reached $3.3 billion, up 27% YoY and 35% sequentially. The company's people count stood at 230,339, with attrition at 12.8% on a last twelve months (LTM) basis. Revenue per employee improved by 2.4% YoY.
The company highlighted its five-pillar AI strategy: transforming services with AI, building differentiated AI IP (like AI Force), expanding AI services, scaling strategic partnerships (including OpenAI, NVIDIA, Google Cloud, ServiceNow, Cohere, and a new global Premier partnership with Anthropic), and developing AI talent. Investments include a new business unit, HCLTech Pulse, for fast-growing enterprises, the acquisition of HPE's Telco Solutions Group, and expansion of its India footprint with centers in Bhubaneswar and GIFT City, and a semiconductor lab in Bengaluru with an investment of ₹185 crores.
Looking ahead, HCL Technologies provided its FY27 guidance: constant currency revenue growth expected between 2.5% to 4% at the company level, and 3% to 4% for the Services business. EBIT margin guidance remains at 17.5% to 18.5%. The company remains optimistic due to record first-half bookings, strong demand for Advanced AI, improved margin performance, and its full-stack AI offerings.
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