TechM focuses on AI, large deal wins in Q3; sets up new hub in Chennai

Indian IT services and consulting firm Tech Mahindra reported a revenue growth of 1.4% year-on-year (YoY) to ₹13,286 crore but a dip of 0.2% compared to the previous quarter. The company, however, said that it will continue to focus on next-generation technologies, including artificial intelligence/GenAI, 5G, blockchain and cybersecurity, to drive digital transformation for global clients.

The company further saw a 92.63% YoY increase in consolidated profit for the quarter ended December 2024, reaching ₹983.2 crore, up from ₹510.4 crore last year. However, profit declined by 21% quarter-on-quarter from ₹1,250.1 crore.

Notably, Tech Mahindra secured net new deal wins of $745 million, up from $603 million in Q2 and $381 million last year, with the manufacturing sector showing the highest growth, followed by banking, financial services and insurance (BFSI), retail, and healthcare. CEO Mohit Joshi noted an improved deal win rate in key verticals and emphasised that consistent operating margin expansion, despite currency challenges, keeps the company on track for its long-term goals.

Joshi marked the completion of his first year in the role, noting that the company onboarded over 40 new clients in key accounts, with 12 added in the December quarter. "We got 6 large deals from these clients recently," he added.

Tech Mahindra is investing heavily in Generative AI and has established a Generative AI Studio to enhance decision-making and digital efficiency, particularly in BFSI, healthcare, and retail. The company partnered with ServiceNow in December to launch the One E2E Platform, an enterprise service management solution using Generative AI to modernise infrastructure and integrate AI into key processes. It also launched TechM VerifAI for validating AI outcomes and iTechM agentX, a suite of Generative AI solutions to enhance enterprise efficiency.

Additionally, the company’s total headcount stood at 150,488, reflecting a 2.5% quarterly decline but a 2.9% annual increase. The IT attrition rate for Q3 FY25 was 11%, up from 10% in Q3 FY24 but stable compared to 11% in Q2 FY24.

To be sure, in the previous quarter that ended September 30, Tech Mahindra also announced partnerships to promote Generative AI adoption and improve cybersecurity, collaborating with Mahindra & Mahindra and Horizon3.ai. Some of its initiatives have started to pay off, the company said.

In a related announcement on Friday, Tech Mahindra said it has opened an advanced Manufacturing Experience Center in Sholinganallur, Chennai, designed to help manufacturers quickly prototype and scale AI-driven innovations to tackle challenges like high operational costs and supply chain disruptions.

The centre will also help develop Proof of Concepts (PoCs) and offer an immersive experience with Industry 4.0 technologies, including Internet of Things (IoT), machine learning, robotics, and augmented reality)/virtual reality, digital twins, and smart factory systems, the company said.