The Q4 PAT of Hexaware Technologies drops 14.4% to Rs 291 crore

Hexaware Q4 Profit Drops 14% on Labour Code Costs, Revenue Grows 10%

Carlyle-backed IT services firm Hexaware Technologies reported a 14.4% decline in net profit for the fourth quarter of calendar year 2025, impacted by a seasonally weak quarter and one-time labour code charges.

Net profit fell to Rs 291.6 crore from a year earlier. On a sequential basis, profit declined 22.5% from nearly Rs 370 crore in the September quarter. The company said it incurred labour code-related charges of Rs 111 crore during the period, which weighed on margins.

Despite the profit drop, revenue rose 10.3% year-on-year to Rs 3,478.2 crore, though it slipped 1.5% compared with the previous quarter. In constant currency terms, revenue stood at $389 million, up 4.5% annually.

For the full calendar year 2025, Hexaware posted revenue of $1.5 billion, marking a 7.6% growth over the previous year.

CEO R Srikrishna said the year remained challenging for the IT industry but noted stronger deal wins toward the end of the year. “This sets us up for a better 2026,” he said, adding that easing macroeconomic pressures and tariffs are helping improve demand.

“It is not a strong recovery yet, but demand is looking better,” Srikrishna said, noting that the company has increased hiring in anticipation of growth next year.

Segment-wise, the banking vertical led quarterly growth with an 11.1% rise. However, three of the company’s six business segments recorded sequential declines, while financial services remained flat. On an annual basis, all segments except hi-tech posted growth.

Investors reacted cautiously to the results. Shares of Hexaware fell 7.6% to close at Rs 637 on the National Stock Exchange, amid broader weakness in technology stocks. The decline also comes as concerns grow that new AI offerings, such as those from Anthropic, could pressure pricing for IT service providers.