Earnings call transcript: Black Box posts record Q2 2027 revenue as data center demand surges

Black Box Limited disclosed record quarterly and half-year revenue in Q2 FY 2027, with revenue soaring 22% year on year to INR 1,936 crore and EBITDA increasing 23% to INR 175 crore. Profit after tax rose 31% to INR 73 crore. The company's stock jumped 1.91% to $900.7, nearing the top of its 52-week range, as investors took notice of robust demand in data center infrastructure, a record order backlog, and management's confidence in hitting the upper echelon of full-year guidance.

Data center work is increasingly a larger portion of the business, accounting for 20% of Q2 revenue. The order backlog skyrocketed to a record $1.044 billion, up 88% from the previous year. Management highlighted that AI and hyperscale spending remain strong and structural, not cyclical. The firm anticipates better order bookings in FY 2028 and expects margin expansion ahead.

Black Box's business continues to expand across data center, enterprise, and technology products segments. Quarter-over-quarter revenue growth was 13%, while year-over-year growth was 22%, demonstrating sustained demand across its global operations. H1 FY 2027 revenue reached INR 3,655 crore, up 23% from the prior year, with EBITDA growing 29% to INR 335 crore, marking a 9.2% EBITDA margin.

The broader IT Services industry recognizes Black Box as a prominent player, with analysts highlighting its competitive positioning. Additional ProTips on the platform offer investors deeper insights. For Q2 FY 2027, revenue was INR 1,936 crore, EBITDA was INR 175 crore, EBITDA margin was 9.0%, and profit after tax was INR 73 crore.

For H1 FY 2027, revenue stood at INR 3,655 crore, EBITDA was INR 335 crore, and EBITDA margin was 9.2%, with H1 profit after tax at INR 129 crore, showcasing robust growth across the board. Operating cash flow for H1 FY 2027 was INR 115 crore. While no EPS or revenue consensus forecast was provided, the quarter's results are clear and strong, with record quarterly and half-year revenue.

The market response to the earnings update and management's outlook was positive, as Black Box shares surged to $900.7, near its 52-week high. Investors focused on the record backlog, growing data center contribution, and the company's confidence in meeting the upper end of its FY 2027 revenue guidance. With a target of INR 7,800 crore to INR 8,000 crore for FY 2027 and a medium-term goal of 10% EBITDA margins or higher, Black Box is targeting revenue expansion and profitability growth.

CEO Sanjeev Verma emphasized the importance of the quarter, noting that data center strategy is still in its growth cycle, and AI infrastructure spending is a long-term structural shift rather than a short-term trend. CFO Deepak Bansal highlighted that growth is being translated into profitability and cash generation, despite potential margin pressures from hiring, project concentration risk, and macroeconomic uncertainties.