Hexaware Technologies Q2 Results: Profit jumps 38% YoY to Rs 380 crore but misses estimates
Hexaware Technologies
reported a 38% on-year rise in June quarter net profit in rupee terms at Rs 380 crore. Profit rose 16% sequentially.
Profit trailed expectations, largely due to a more than 20% increase in other expenses such as acquisition-related cost, and impairment of customer contract associated with an earlier acquisition.
Hexaware issued a muted revenue guidance for the year ahead. The company follows a January to December financial year.
Unlike its mid-tier peers, Hexaware's Q2 revenue was relatively subdued at Rs 3,260 crore, rising 11.1% on-year and 1.6% sequentially in constant currency terms, lagging Street estimates. In constant currency terms, revenue stood at $382.1 million, growing 1.3% sequentially and 7.5% from a year ago.
During the quarter, revenue growth was impacted by decline in manufacturing and consumer segments, and flat growth in financial services.
Live Events
'Our growth expectations for the year are a little bit lower now than it was in the beginning of Q2,' R. Srikrishna, CEO, Hexaware told ET.
'With lots of new promises of higher tariffs against multiple countries…that's on the negative side. On the positive side, some trade deals have been announced with some smaller countries and there could be a slew of them in the next few weeks,' he added.
Shares of Hexaware fell sharply on the earnings announcement. They closed 10.7% lower at Rs 738.25 apiece, underperforming a 0.88% decline in the benchmark BSE Sensex.
The Hexaware management said there is softness and cyclicality in the macro environment, and that all large consolidation deals are continuing.
'Small and mid-sized deals are progressing well. However, decision making is slowed. Consequently, lowered expectations for the rest of the year,' the company said.
Geographically, Europe witnessed growth both on-year and sequentially, but Asia Pacific witnessed a decline from a year ago, and marginal growth from the March quarter.
'There will be one or two quarters which will have blips (in Asia Pacific) but long-term, in general, it will be positive,' said Srikrishna. 'In India, we made an acquisition to serve GCC (global capability centre) customers here. In the Middle East, we continue to have a strong pipeline and expect to convert in Q3 and grow revenues in Q4.'
This month, Hexaware acquired Bengaluru-based SMC Squared for $120 million (about Rs 1,038 crore) in an all-cash deal, which is expected to add revenue growth in the coming two quarters.
While adjusted margin improved to 18.1%, up from 17.1% in the March quarter, its full-year margin guidance stood at 17.1–17.4%.
The company expects banking to continue to deliver better sequential growth despite a one-off degrowth in Q1 which will impact financial services for the full year.
'On manufacturing, customers are waiting for clarity on costs. Once that happens, it takes a few weeks to translate that into what it means for them,' Srikrishna said.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
NDTV
36 minutes ago
- NDTV
Natural Disasters Caused $135 Billion In Economic Losses: Reinsurance Giant Swiss Re
Natural disasters caused $135 billion in economic losses globally in the first half of 2025, fuelled by the Los Angeles wildfires, reinsurer Swiss Re said Wednesday. Swiss Re, which serves as an insurer of insurance companies, said first-half losses were up from the $123 billion in the first half of 2024. The Zurich-based reinsurance giant estimated that of this year's first half losses, $80 billion had been insured -- almost double the 10-year average, in 2025 prices. The Los Angeles blazes in January constitute the largest-ever insured wildfire loss event by far, reaching an estimated $40 billion, said Swiss Re. It said the "exceptional loss severity" of the fires was down to prolonged winds, a lack of rainfall and "some of the densest concentration of high-value single-family residential property in the US". Swiss Re said losses from wildfires had risen sharply over the past decade due to rising temperatures, more frequent droughts and changing rainfall patterns -- plus greater suburban sprawl and high-value asset concentration. "Most fire losses originate in the US and particularly in California, where expansion in hazardous regions has been high," it said. Before 2015, wildfire-related insured losses made up around one per cent of all natural catastrophe claims, but now account for seven per cent. - Hurricane season approaching - Insured losses from severe thunderstorms amounted to $31 billion in the first half of 2025. The second half of the year is usually more costly for insurers due to damage during the North Atlantic hurricane season. If current loss trends continue, global insured losses from natural catastrophes in 2025 could exceed the Swiss Re Institute's projections of $150 billion. "The strongest lever to increase the resilience and safety of communities is to double down on mitigation and adaptation. It's here that everyone can help reduce losses before they occur," said Swiss Re's group chief economist Jerome Haegeli. "While mitigation and adaptation measures come at a price, our research shows that, for example, flood protection measures such as dykes, dams and flood gates are up to 10 times more cost-effective than rebuilding." The March earthquake in Myanmar figured among the major natural disasters in the first six months of the year, with the tremors felt in neighbouring Thailand, India, and China. In Thailand alone, insured losses reached $1.5 billion. Overall, while natural disasters caused $135 billion in economic losses in the first half of 2025, man-made disasters -- which include industrial accidents -- caused another $8 billion in losses, of which $7 billion were insured losses.
NDTV
36 minutes ago
- NDTV
Apple To Invest Additional $100 Billion In US: White House Official
Apple will invest an additional $100 billion in the United States, taking its total pledge to $600 billion over the next four years, a senior White House official said Wednesday. The announcement, which was first reported by US media, will be officially made later Wednesday at 4:30 pm (2030 GMT) at a White House event with President Donald Trump. In February, Apple said it would spend more than $500 billion in the United States and hire 20,000 people, with Trump quickly taking credit for the decision. The Silicon Valley-based giant said it was its "largest-ever spend commitment," which came as tech companies battle for dominance in developing artificial intelligence technology. It builds on plans announced in 2021, when the company founded by Steve Jobs said that it would invest $430 billion in the US and add 20,000 jobs over the next five years. Trump, who has pushed US companies to shift manufacturing home by slapping tariffs on trading partners, claimed that his administration was to thank for the investment. Apple reported a quarterly profit of $23.4 billion in late July, topping forecasts despite facing higher costs due to Trump's sweeping levies. Tariffs are essentially a tax paid by companies importing goods to the United States. This means Apple is on the hook for tariffs on iPhones and other products or components it brings into the country from abroad.
NDTV
37 minutes ago
- NDTV
1,240 National Highway Projects Worth Rs 7.8 Lakh Crore Underway: Nitin Gadkari
New Delhi: Union Minister Nitin Gadkari on Wednesday said 1,240 national highways projects in 29,406 km, costing Rs 7.80 lakh crore, are currently under construction in the country, of which 15,674 km have been completed. These projects are under various stages of construction and are scheduled for completion in a phased manner by the financial year 2028-29, Gadkari said in a written reply to Rajya Sabha. The ministry of road transport and highways is primarily responsible for the development and maintenance of National Highways (NHs) and Expressways. Responding to a separate question, the minister said that during the current Financial Year 2025-26, the government has prepared the annual plan for the development of about 19,555 km of NHs, including about 548 km in the State of West Bengal. He also said a total of 4,557 electric vehicle Public Charging Stations (PCSs) have been installed on the State/National Highways and Expressways in the country. The minister said the government has prioritised the maintenance of the existing national highways network and has evolved a mechanism to ensure maintenance and repair (M&R), including timely repair of potholes on all NHs, through accountable maintenance agencies. NHs' development projects are executed mainly in three modes-- Build-Operate and Transfer (BOT), Hybrid Annuity Model (HAM) and Engineering Procurement and Construction (EPC). Concession period, including maintenance for projects on Build-Operate and Transfer (BOT), is 15 to 20 years, and on Hybrid Annuity Model (HAM) is generally 15 years. The Concessionaire is responsible for the maintenance of the respective NH stretches within the concession period of the project. Only in the case of EPC projects, the Defect Liability period (DLP) is 5 years for the bituminous pavement works and 10 years for concrete pavement works.
