Expleo Q2 EBITDA falls 16.2% as margin declines to 13.8%

Expleo Solutions Limited reported operating revenue of Rs 292.64 crore in the second quarter of fiscal year 2027 (Q2 FY27), 3.5% above a year earlier, but adjusted earnings before interest, tax, depreciation and amortisation (adjusted EBITDA) fell 16.2% to Rs 40.44 crore and margin declined to 13.8% from 17.1%.

What did Expleo report for Q2 FY27?

Expleo reported higher revenue but lower year-on-year earnings for the quarter ended 30 September 2026. Operating revenue was Rs 292.64 crore, compared with Rs 282.70 crore in Q2 FY26, while total income increased 2.4% to Rs 302.60 crore from Rs 295.40 crore. The Rs 9.96 crore difference between operating revenue and total income was wider than the Rs 12.70 crore difference reported a year earlier.

Adjusted EBITDA was Rs 40.44 crore, compared with Rs 48.27 crore in Q2 FY26. Total comprehensive income, comprising profit after tax and other comprehensive income, declined 8.7% to Rs 39.33 crore from Rs 43.09 crore. Basic earnings per share (EPS) decreased 8.5% to Rs 23.45 from Rs 25.62.

Why did Expleo’s EBITDA margin decline in Q2 FY27?

Expleo did not provide a management explanation for the margin movement, but its reported expenditure increased faster than operating revenue in Q2 FY27. Employee cost rose 8.6% year on year to Rs 188.70 crore, exceeding the 3.5% increase in operating revenue. Total expenditure increased 5.1% to Rs 255.88 crore from Rs 243.42 crore.

That cost pattern coincided with a Rs 7.83 crore decline in adjusted EBITDA despite a Rs 9.94 crore increase in operating revenue. Other expenditure rose 2.1% to Rs 63.50 crore, while depreciation fell 50.4% to Rs 3.69 crore from Rs 7.44 crore. Profit from operations before other income, interest and exceptional items decreased 6.4% to Rs 36.76 crore.

The presentation defines adjusted EBITDA as profit after tax (PAT), plus tax, foreign-exchange loss or gain, finance cost and depreciation, less other income. On that measure, margin was 13.8% in Q2 FY27, down 3.3 percentage points from 17.1% in Q2 FY26. Profit before tax declined 10.1% to Rs 46.20 crore, while PAT before other comprehensive income fell 8.5% to Rs 36.40 crore.

How did Expleo’s Q2 result compare with Q1 FY27?

Expleo’s operating revenue was broadly stable sequentially, while adjusted EBITDA and its margin declined. Operating revenue rose 0.4% from Rs 291.55 crore in Q1 FY27 to Rs 292.64 crore in Q2 FY27, and total income increased 1.4% from Rs 298.48 crore to Rs 302.60 crore. Adjusted EBITDA fell 4.5% from Rs 42.35 crore.

The adjusted EBITDA margin decreased by 0.7 percentage points from 14.5% in Q1 FY27 to 13.8% in Q2 FY27. In contrast, total comprehensive income rose 11.3% sequentially from Rs 35.35 crore to Rs 39.33 crore. Profit before tax increased 4.4% to Rs 46.20 crore, alongside an exchange gain of Rs 2.78 crore versus Rs 0.08 crore in Q1 FY27.

Net cash was Rs 275.70 crore at 30 September 2026, down Rs 77.10 crore from Rs 352.80 crore at the end of Q1 FY27. Debtor days improved to 93 from 108, active clients increased to 217 from 213, and delivery employees rose by 73 to 3,756 over the same comparison.

What does Expleo’s first-half performance show?

Expleo’s first-half revenue and total comprehensive income increased year on year, although the adjusted EBITDA margin remained below the prior-year level. Operating revenue rose 7.7% to Rs 584.19 crore in H1 FY27, while total income increased 7.1% to Rs 601.10 crore. Adjusted EBITDA rose 1.6% to Rs 82.80 crore.

The H1 FY27 adjusted EBITDA margin was 14.2%, compared with 15.0% in H1 FY26, a decline of 0.8 percentage points. Total comprehensive income increased 10.1% to Rs 74.68 crore, while basic EPS rose 17.3% to Rs 45.47. Profit before tax increased 13.4% to Rs 90.44 crore, including an exchange gain of Rs 2.86 crore for the half year.

Digital revenue was Rs 139.70 crore in Q2 FY27, compared with Rs 148.80 crore in Q2 FY26, while its revenue share declined to 47.7% from 52.6%. Banking, financial services and insurance (BFSI) accounted for 81.1% of Q2 FY27 revenue, compared with 81.0% a year earlier. Europe represented 57.8% of revenue, up from 55.9%, while North America’s share declined to 7.7% from 12.9%.

How concentrated was Expleo’s Q2 revenue base?

Expleo remained concentrated in BFSI, which contributed 81.1% of Q2 FY27 revenue. Aerospace contributed 9.6%, automotive accounted for 9.0%, and transportation represented 0.3%. Automotive’s share rose from 8.0% in Q1 FY27, while aerospace declined marginally from 9.7% in the preceding quarter.

The top five clients generated 36% of Q2 FY27 revenue, compared with 34% in Q1 FY27 and 35% in Q2 FY26. The top 10 clients represented 51%, unchanged sequentially but below 53% a year earlier. Expleo also reported 31 customers with trailing 12-month revenue above $1 million, compared with 33 in Q1 FY27 and 29 in Q2 FY26.

Conclusion

Expleo’s Q2 FY27 results show that 3.5% operating-revenue growth did not translate into year-on-year adjusted EBITDA or total comprehensive-income growth. Employee cost increased 8.6% and total expenditure rose 5.1%, while adjusted EBITDA declined 16.2% and margin fell to 13.8%. For H1 FY27, operating revenue rose 7.7% and total comprehensive income increased 10.1%.

The presentation provides no financial target or formal outlook. The next reported period will therefore be relevant for whether the Q2 13.8% margin changes alongside employee cost of Rs 188.70 crore, digital revenue share of 47.7%, and the 51% contribution from the top 10 clients.