What Do Mphasis Q2 Results Indicate About Its Growth Trajectory in FY26?
About the Company
Mphasis Limited is a leading Indian IT and business process outsourcing firm specializing in cloud and cognitive solutions, data analytics, and digital transformation services. The company serves global clients across banking, insurance, logistics, and technology verticals. Its Q2 FY26 results reflect balanced growth, strong client retention, and stable margins amid a cautious global tech spending environment.
Quarterly Financial Highlights
| Metric | Q2 FY26 | QoQ Change | YoY Change |
|---|---|---|---|
| Net Profit | ₹469 Cr | ↑ 6% | ↑ 11% |
| Revenue | ₹3,901 Cr | ↑ 5% | ↑ 10% |
| EBIT | ₹595 Cr | ↑ 4% | ↑ 9% |
| EBIT Margin | 15.3% | Flat | Flat |
| New Deal Wins (TCV) | USD 528 Mn | ↓ 31% | ↑ 9% |
Mphasis delivered a steady quarter with broad-based revenue growth and stable margins, though total contract value (TCV) showed a sequential decline due to project transitions and longer client decision cycles.
Business Performance and Management Commentary
Management highlighted strong execution in Direct business, which grew 5.5% QoQ and 13.4% YoY on a reported basis. In constant currency terms, Direct revenue growth stood at 2.2% QoQ and 7.9% YoY. The decline in TCV was attributed to delayed decision-making by certain clients in North America, while deal conversion pipelines remain healthy for the coming quarters.
New-gen services continued to account for 87% of overall deal wins, reflecting Mphasis’s ongoing pivot toward AI-led and digital transformation engagements.
Short-term traders focused on IT sector sentiment can align their intraday setups through Nifty Option Tip updates, which reflect broader index sensitivity to tech stocks like Mphasis.
SWOT Analysis
| Strengths | Weaknesses |
|---|---|
| Strong client retention, steady Direct business growth, diversified client base. | Slower deal ramp-up and dependency on North American clients. |
| Opportunities | Threats |
| Expanding new-gen services, AI integration, and automation-led digital offerings. | Global IT budget tightening and macroeconomic headwinds. |
Investment View
Mphasis continues to show consistent execution with stable margins and a resilient business model. While short-term deal flow moderation may impact momentum, its focus on high-value digital and AI-driven solutions should sustain growth over the medium term. Investors may consider accumulating on declines, keeping a long-term horizon aligned with global IT recovery trends.
Investor Takeaway
Indian-Share-Tips.com Nifty Expert Gulshan Khera, CFP®, notes that Mphasis’s focus on profitability consistency and strong digital order book makes it a defensive play within the IT pack. The stock’s stability during volatile market phases adds to its investment appeal.
Read more expert-backed stock analyses and IT sector updates at Indian-Share-Tips.com, which is a SEBI Registered Advisory Services.
Related Queries on Mphasis Performance and IT Sector Outlook
- Can Mphasis Sustain Its Margin Stability in FY26?
- How Will Mphasis’s AI Integration Drive Future Growth?
- What Does the Decline in Deal Wins Indicate for Near-Term Outlook?
SEBI Disclaimer: The information provided in this post is for informational purposes only and should not be construed as investment advice. Readers must perform their own due diligence and consult a registered investment advisor before making any investment decisions. The views expressed are general in nature and may not suit individual investment objectives or financial situations.
