TCS grows 0.5% in Q2 as AI crosses $3.1 billion and Porsche and Best Buy lift orders

Tata Consultancy Services, which designs, builds and runs technology systems for large global businesses like banks and carmakers, reported revenue of Rs73,188 crore for the quarter ended September 30, 2026, up 0.5% sequentially in constant currency, with net profit of Rs13,884 crore and orders of $9.6 billion . International revenue grew 1.2%, annualised AI revenue crossed $3.1 billion, and TCS announced a five-year Porsche partnership with an MHP acquisition and a Best Buy centre transition . Growth stayed slow but AI-led deals kept the order book firm.

International growth made up for a weak India quarter

TCS has now grown sequentially for four quarters, but the pace remains below 2%. International business, which excludes India, did the work in Q2 FY27.

Quarter	Consolidated revenue, Rs crore	Sequential growth in constant currency
Q3 FY26	67,087	0.8%
Q4 FY26	70,698	1.2%
Q1 FY27	72,275	0.4%
Q2 FY27	73,188	0.5%

Q2 FY27 growth was 1.3% sequentially and 11.2% year on year in rupee terms . The constant currency number strips out currency swings to show real volume growth. That volume growth is holding steady after the stronger Q4 FY26.

Banks, factories and tech services led the quarter

Three industries carried Q2 FY27. All three had lagged or been mixed in Q1 FY27 and then picked up as management had expected.

Industry in Q2 FY27	Share of revenue	Sequential growth in constant currency
BFSI	32.8%	2.5%
Manufacturing	9.0%	3.1%
Technology and Services	8.6%	3.1%

BFSI strength extends what management called good growth across geographies in Q1 FY27 . Management then linked it to US banks doing very well and said it was optimistic on sustained BFSI growth .

Manufacturing had shown softness in auto in Q1 FY27 from tariff pressure, macro uncertainty, EV recalibration and cost discipline . The outlook then turned positive on multiple net-new wins including the $0.8 billion SKF AI-led transformation deal . Management had said manufacturing would turn around in Q2, life sciences could turn around in Q2 and tech services would continue to grow .

Other industries were broadly flat in constant currency in Q2 FY27 . That fits Q1 FY27, when consumer was hit by inflation and geopolitics, life sciences declined though core AI demand stayed intact, communications grew modestly and energy slipped slightly .

Britain and Asia Pacific grew faster than America

The core markets of North America, UK and Continental Europe stayed stable. The UK and Asia Pacific provided most of the lift while India fell sharply.

Market in Q2 FY27	Share of revenue	Sequential growth in constant currency
North America	48.3%	0.4%
UK	17.8%	3.5%
Continental Europe	15.2%	0.4%
Asia Pacific	8.6%	2.0%
India	5.5%	-10.3%

Latin America was 2.1% and MEA was 2.5% of revenue in Q2 FY27 . The mix has swung quarter to quarter. In Q4 FY26 growth was broad based with North America at 1.4%, UK at 2.4% and Europe at 1.0% . In Q3 FY26 Europe did well while North America was flattish on furlough seasonality and Regional Markets delivered strong growth . In Q1 FY27 growth was driven by India, public services and products and platforms .

Orders stayed near $10 billion for another quarter

Total Contract Value, or the total value of deals signed in a quarter, was $9.6 billion crore in Q2 FY27 . That keeps TCS in the high-900-crore range around a stronger Q4 FY26.

Period	Total Contract Value
Q3 FY26	$9.3 billion
Q4 FY26	$12 billion including three mega deals
Q1 FY27	$9.5 billion including the $0.8 billion SKF deal
Q2 FY27	$9.6 billion

For full FY26 TCS reported $40.7 billion including 5 mega deals . Q1 FY27 was led by the landmark $0.8 billion global AI-led transformation with SKF, described as the 6th mega deal in the last 5 quarters, plus a ServiceNow partnership and a Europe Fortune Global 50 deal, all completely net-new AI-led opportunities .

Q4 FY26 included three mega wins from Marks and Spencer, a leading UK telecom operator and a leading American healthcare and pharmacy retailer . Q3 FY26 included one mega win in North America, with BFSI at $3.8 billion. Management said on the Q1 FY27 call it expected demand to improve sometime in Q2 as large signed projects start yielding revenue .

Porsche brings car consulting plus a five-year AI mandate

CEO K Krithivasan said the quarter had broad-based growth in international markets and most segments, and called Porsche and Best Buy a new category of transformation partnerships to build repeatable platforms that industrialise AI at scale .

Porsche AG involves a five-year strategic partnership where TCS will set up a dedicated AI Mobility Centre of Excellence for manufacturing, engineering, operations and customer experience, and through its subsidiary will acquire 100% of MHP Management- und IT-Beratung GmbH, Porsche's Germany-based management and IT consulting subsidiary . The partnership and acquisition remain subject to regulatory approvals .

The related filing puts the purchase at 320 million euros, with a linked 5-year work deal worth 125.00 crore euros with MHP and TCS, needing 4 government approvals and expected to close in 3-4 months . Porsche CEO Dr. Michael Leiters said combining Porsche automotive expertise with TCS digital and AI capabilities would strengthen innovation, efficiency and competitiveness in a data and software-driven mobility world .

Best Buy hands its India team to TCS for an AI rebuild

Best Buy involves an agreement to transition Best Buy's Global Capability Center in India to TCS and redesign workflows to transform it into an AI Capability Center, combining the centre's retail knowledge with TCS technology, engineering, AI and global delivery under the Global Value and Innovation Centres framework . The press release gives no price, headcount or phasing beyond that description .

The direction fits the dedicated Global Value and Innovation Center business unit launched on June 8, 2026 to build new AI-native centres and convert existing centres into value-led centres . TCS says it already supports over 150 companies on capability centres .

Other Q2 FY27 wins show the same AI-core logic. Honeywell Technologies chose TCS as global end-to-end SAP S/4HANA partner using TCS Crystallus and RISE with SAP . Aareal Bank signed a long-term partnership for data centre, cloud, workplace, cybersecurity and infrastructure management with an AI-led delivery model . Vodafone Business will work with TCS to modernise technology and scale digital adoption . Dubai Gold and Commodities Exchange will modernise trading, clearing and surveillance infrastructure with TCS .

AI sales passed a tenth of revenue after doubling in nine months

Annualised AI revenue, or quarterly AI sales scaled to a yearly run rate, was $3.1 billion in Q2 FY27 and crossed 10% of revenue . The climb from late 2025 has been fast.

Sources: December 17, 2025 Analyst Day — ; Q3 FY26 — ; Q4 FY26 — ; Q1 FY27 — ; Q2 FY27 — .

Point in time	Annualised AI services revenue
December 17, 2025 Analyst Day	$1.5 billion with 16.3% sequential growth
Q3 FY26	$1.8 billion with 17.3% sequential growth in constant currency
Q4 FY26	$2.3 billion
Q1 FY27	$2.6 billion, up 13.6% sequentially
Q2 FY27	$3.1 billion

Management defines this as AI for business transformation across industry value chains plus AI for modernisation, excluding work where AI is only used as a tool for testing . Growth can be lumpy because many projects last one or two quarters without traditional annuity, with about $75 million incremental AI revenue in Q1 FY27 versus about $125 million in Q4 FY26 .

Agents, labs and Google and Nvidia partnerships do the delivery work

TCS said AI momentum stayed strong with demand for AI-native solutions, AI-led transformation of enterprise systems and autonomous shared services, while cybersecurity stayed a top priority . Its Human+AI Services Autonomy model for application maintenance earned top customer rankings . That model moves work through five levels from AI as a tool to supervised agents to autonomous workforces, and was already instantiated for every service line by December 2025 .

Q2 FY27 added building blocks for that model. TCS launched TCS ADD AgentHub, a role-based agentic AI platform for drug development . It opened a lights-out factory lab at Sahyadri Park in Pune to simulate self-optimising factories using digital twins, robotics and industrial AI . It opened an Autonomous Engineering Lab Powered by NVIDIA at Global Axis in Bengaluru for mobility and manufacturing . It set up a Gemini Experience Center in Mexico City, its second in Latin America and ninth worldwide, and another Consumer Business Gemini center in Kolkata with Google Cloud .

These follow Q1 FY27 foundations including a global premier partnership with Anthropic with early access to Claude models and 50,000 licenses, first global systems integrator partnership with Mistral AI for sovereign models, SovereignSecure Cloud for Europe, and a dedicated Global Value and Innovation Center unit for capability centres . Management said in Q1 FY27 it was investing across talent, partner ecosystems, platforms and go-to-market because demand needs integrated offerings across infrastructure to intelligence .

Profit held steady and cash covered earnings

Operating margin, or operating income as a share of revenue, was 24.0% in Q2 FY27 . Net profit was Rs13,884 crore with net margin at 19.0% . Net cash from operations was Rs14,190 crore, or 102.2% of net income, showing full conversion of profit to cash .

Source: .

Quarter	Consolidated net profit, Rs crore
Q2 FY26	12,904
Q1 FY27	13,849
Q2 FY27	13,884

Profit was almost flat sequentially after a Q1 FY27 margin dip of 130 basis points to 24% on annual increments that cost 170 basis points, partly offset by 40 basis points of currency and efficiencies, with net margin at 19.2% in that quarter . Q3 FY26 margin was 25.2% after productivity and pyramid gains plus currency, offset by wage impact and brand and partnership spend . Q4 FY26 margin was 25.3%, up 10 basis points sequentially, with full FY26 at 25%, up 70 basis points year on year to a 4-year high .

Management said on the July 2026 call it aspired to inch back toward FY26 levels and exit at 25% plus . The December 2025 deck framed the path as 25.2% toward 26-28% via utilisation, pyramid optimisation, repurposed sales spending, delivery productivity and outcome pricing . CFO Samir Seksaria said TCS kept strengthening capabilities via acquisitions, partnerships and niche talent while holding strong cash conversion and industry-leading profitability .

Headcount crossed 598,000 as training accelerated

Workforce strength was 598,056 in Q2 FY27 with IT services attrition over the last twelve months at 13.3% . Learning hours were 1.71 crore in the quarter, up 17% sequentially .

Sources: Q3 FY26 — ; Q4 FY26 — ; Q1 FY27 — ; Q2 FY27 — .

Quarter end	Headcount
Q3 FY26	582,163
Q4 FY26	584,519
Q1 FY27	593,798
Q2 FY27	598,056

Q1 FY27 had completed annual increments globally and aligned India salaries with the new labour code . In Q1 FY27, 14,000 campus graduates were onboarded and over 50% of lateral hires already had next-generation skills . Management said it did not expect white-collar work to shrink drastically but to shift toward prompt engineering, model training and lifecycle management .

Learning intensity keeps rising from a high base. In Q1 FY27 associates logged 1.46 crore learning hours and gained over 13.00 lakh competencies . In FY26 the totals were 6.90 crore hours and 52.00 lakh competencies, with over 270,000 associates at advanced AI proficiency . By December 2025 over 580,000 staff were AI-aware and over 180,000 had higher-order AI skills, with all sales and pre-sales trained in AI . Attrition was 13.5% in Q3 FY26, up 20 basis points sequentially , so Q2 FY27 at 13.3% shows stability .

Dividend stayed at Rs12 with October dates

The board declared Rs12 per share with record date October 14, 2026 and payment date October 30, 2026 . For the year ended March 31, 2026 TCS paid Rs110 per Rs1 share, comprising Rs79 in interim payouts plus Rs31 final . The Rs12 quarterly level compares with Rs11 a year ago, with the prior Rs12 recorded July 15, 2026 and paid July 31, 2026 . The December 2025 deck noted Rs275,000 crore in dividends since listing plus Rs95,000 crore in buybacks .

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