Labour Code impact, legal claim provision drag down TCS Q3 net profit by 14% to ₹10,720 crore
Revenue from operations in the quarter under review increased 4.86% to ₹67,087 crore from ₹63,973 crore
Tata Consultancy Services (TCS) reported a 14% decrease in net profit for the third quarter of 2025, dropping to ₹10,720 crore from ₹12,444 crore the previous year. This decline was primarily due to factors such as the impact of new labour codes, amounting to ₹2,128 crore, provisions towards legal claims of ₹1,010 crore, and expenses related to employee terminations totaling ₹253 crore.
The company also laid off 1,800 employees during the quarter, with the process expected to continue. As of December 31, 2025, TCS had a global workforce of 582,163 employees, with an attrition rate of 13.5% over the past 12 months. Revenue for the quarter grew by 5% year-over-year to ₹67,087 crore. The board has declared a dividend of ₹57 per share, with the record date set for January 17, 2026, and payment scheduled for February 3, 2026.
Despite the profit decline, TCS's annualized revenue from AI services reached $1.8 billion, growing at a rate of 17.3% quarter-over-quarter in constant currency. The operating margin remained stable at 25.2%, while the net margin increased by 40 basis points quarter-over-quarter to 20.0%.
Written by urgent.news from The Hindu's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
