The Bad PlaceTimes of India | HCLTech shares drop 11% as weak outlook overshadows AI gains
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HCLTech’s shares fell nearly 11% on the BSE after the company issued a softer‑than‑expected outlook following a muted March‑quarter performance. CEO C Vijayakumar said the firm has largely offset AI‑driven deflation in its traditional services business by introducing new‑age offerings, projecting FY27 services revenue growth of 1.5‑4.5% (mid‑point around 3%). The March quarter saw a 3.3% sequential decline in constant‑currency revenue, though it rose 2.4% year‑on‑year to $3.6 billion, and FY26 revenues grew 3.9% in constant terms to $14.6 billion. HCLTech is investing heavily in “advanced AI” services, now at a $620 million annualised run‑rate, alongside cloud, cybersecurity and data modernisation, while acknowledging that legacy business remains exposed to AI‑driven pricing pressure. The CEO highlighted continued strength in financial services and technology verticals, downplayed recent layoffs as client‑specific adjustments, and noted that the current guidance does not factor in a pending $160 million acquisition of HPE’s Telco Solutions business. Overall, the company is pursuing a targeted restructuring and AI‑centric growth strategy to navigate slowing client spending and sector‑wide disruption.
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