LatentView Analytics: Navigating Growth with AI and Strategic Partnerships in Q2 FY26

LatentView Analytics Limited has once again demonstrated its robust performance, reporting its 11th consecutive quarter of sequential revenue growth in Q2 FY26. The company achieved a total operating revenue of INR 257 crores, marking a significant 9.1% quarter-on-quarter increase and a strong 23.2% year-on-year growth. This performance has propelled LatentView to an impressive INR 1,000 crore run rate, a notable milestone reflecting sustained operational momentum. Despite a dynamic market landscape, the company's strategic focus on artificial intelligence (AI), key partnerships, and market expansion has been instrumental in driving these positive results. The management's commentary highlights a period of significant investment in capabilities and talent, positioning LatentView for continued growth.

The quarter's success was significantly bolstered by exceptional performance in the financial services practice, which saw an astounding 94% year-on-year growth and a 30% sequential increase. This surge was primarily attributed to successful client acquisitions and effective execution. The consumer goods practice also contributed positively, with a year-over-year growth of approximately 23%. A major highlight for LatentView has been its strategic partnership with Databricks. This collaboration has already yielded $1.4 million in new wins during the quarter, and the company is confident of exceeding$19 million in Databricks-related revenue for the current fiscal year, with an ambitious target of $50 million within three years. This demonstrates the company's ability to leverage cutting-edge platforms to deliver value and expand its service offerings.

Strategic Initiatives and Future Outlook

LatentView's strategic roadmap is clearly defined, with a strong emphasis on deepening client relationships, enhancing data engineering capabilities through partnerships like Databricks, and a robust AI strategy. The company is actively identifying 'diamond accounts' to foster accelerated growth and is investing heavily in its AI Center of Excellence. This center is developing a 'House of AI' concept, integrating various AI disciplines like data engineering, data science, machine learning, generative AI, and agentic AI to solve complex client problems. Initial projects include synthetic data generation, churn analytics with agentic frameworks, and CRM-LLM integration, showcasing a forward-thinking approach to technological advancements.

Geographically, LatentView is expanding its footprint, particularly in the Latin American market, where it sees significant opportunities, especially in banking and financial services. The company is also proactively building its nearshore capabilities in regions like Canada, Mexico, and LATAM, aiming to increase its nearshore employee count to 100 within the next 12 months. This move is strategic, addressing potential visa restrictions and enhancing client proximity and responsiveness. Furthermore, the company is increasing its APAC presence through Global Capability Centers (GCCs) in India to meet regional demand and strengthen local expertise.

Navigating Challenges and Maintaining Margins

While the overall outlook is positive, LatentView acknowledged some challenges during the quarter. The technology vertical experienced a degree of sluggishness, with growth currently in the high single digits, though management anticipates reaching low double digits. The company also faced increased operational expenses in Q2, primarily due to higher marketing costs associated with seasonal events, increased visa-related expenditures (approximately $220,000 more than Q1), and recruitment costs for new talent (around$150,000-$180,000). These investments, while impacting short-term margins, are deemed crucial for long-term growth and capability building.

The Adjusted EBITDA margin for Q2 FY26 stood at 22.5%, consistent with Q2 FY25, but slightly up from Q1 FY26's 22.2%. The company's full-year Adjusted EBITDA margin guidance is set between 22% and 23%, reflecting a commitment to sustained investment in growth initiatives. Reported Profit After Tax (PAT) percentages saw a slight dip, primarily due to lower forex gains compared to the previous quarter and the non-recurrence of a deferred tax gain booked in Q1. The effective tax rate (ETR) for the group is expected to stabilize between 25% and 26% going forward, ensuring more steady-state PAT figures.

Conclusion: Strategic Clarity and Sustained Execution

LatentView Analytics continues to demonstrate strategic clarity and disciplined execution. The company's focus on deepening client relationships, leveraging AI and strategic partnerships, and expanding its global footprint underscores its commitment to sustained growth. Despite facing some short-term margin pressures from increased investments, the management's proactive approach to capability building and market expansion positions LatentView favorably for the future. The consistent revenue growth, strong performance in key verticals, and clear strategic initiatives highlight a company confidently navigating the evolving data and analytics landscape, building investor trust through transparent disclosures and a forward-looking vision.