TCS executives discussed Q2 margins staying flat at 24% despite the wage hike quarter, citing investments in M&A, hiring and subcontractor costs, with TCV at $9.6 billion

Fri 9 Oct 2026

Operating margin this quarter

24 percent

Total contract value

9.6 billion dollars

New hires this quarter

4,500 people

Previously guided Q4 exit margin

25 percent

Heard on business television between 08:38:19 - 08:41:19 IST.

• Margins were flat at 24% sequentially despite being the quarter after wage hikes, unusual historically.
• Management attributed this to four investments: MHP acquisition and partnership costs, niche talent hiring, higher bench strength (4,500 people hired), and subcontractor costs.
• TCV was strong at $9.6 billion, with management citing strong AI-driven deal resonance with customers.
• Management said the earlier guided 25% Q4 exit margin target now looks unachievable given upcoming headwinds like MHP integration and Q3 seasonality.
• Executives said higher global yields and discretionary spend compression are being offset by vendor consolidation wins and tech modernization deals.

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