L&T Technology Services Q1 FY26: Revenue up 16.4% YoY

What LTTS reported for the June 2025 quarter

L&T Technology Services (LTTS), the listed engineering and technology services subsidiary of Larsen and Toubro, announced its Q1 FY26 results for the quarter ended June 30, 2025. The company reported revenue of ₹2,866.0 crore, up 16.4% year-on-year (YoY). Net profit came in at ₹315.7 crore, a marginal 0.7% YoY increase. The company’s EBIT margin for the quarter was reported at 13.3%. Alongside the financial performance, LTTS highlighted continued momentum in large deal wins, with total contract value (TCV) of large deals exceeding $100 million during the quarter. The update matters because LTTS is closely tracked as a pure-play engineering R&D services provider, and its quarterly trends are often read as a signal for demand in automotive, industrial, and digital engineering programs.

Revenue growth YoY, but sequential softness

LTTS reported USD revenue of $135.3 million for Q1 FY26. In US dollar terms, revenue increased 13.6% YoY. On a quarter-on-quarter (QoQ) basis, the company disclosed a 2.9% decline in USD revenue compared with the previous quarter. The sequential decline was attributed to seasonal variations in the SmartWorld segment and difficulties within the automotive industry. The company also indicated that, on a constant currency basis, revenue grew YoY but declined QoQ. This combination of stronger annual growth and weaker sequential performance reflects a quarter where deal momentum remained visible, but near-term delivery was affected by segment-specific conditions.

Profitability snapshot and margin position

The quarter’s EBIT margin was stated at 13.3%. In rupee terms, EBIT was reported at ₹381.3 crore for Q1 FY26, versus ₹383.6 crore in Q1 FY25 and ₹393.9 crore in Q4 FY25, based on the company’s financial table shared in the article. Net income (net profit) stood at ₹315.7 crore. The company also reported that net income represented about 11% of total revenue. While operating profitability stayed broadly stable on a YoY basis, the mix of segment demand and operating costs remained key variables during the quarter.

Expense and income line items from the quarterly statement

The quarterly results table provided additional context on cost movements. Total revenue was ₹2,866.0 crore in Q1 FY26, compared with ₹2,226.9 crore in the preceding quarter (Mar 26 in the table) and ₹2,461.9 crore in Q1 FY25. Total operating expense was ₹2,484.7 crore in Q1 FY26, versus ₹1,880.7 crore in the previous quarter and ₹2,078.3 crore in Q1 FY25. Depreciation and amortization was ₹81.1 crore. Operating income was ₹381.3 crore, and net income was ₹315.7 crore.

Cash flow, balance sheet metrics, and working capital

LTTS reported negative free cash flow of ₹28 crore in Q1 FY26, which the company linked to seasonal factors. Cash and investments at the end of the quarter were reported at ₹2,431 crore. Working capital was reflected in days sales outstanding (DSO) of 98 days, which increased to 116 days when including unbilled revenues. These figures are closely watched for engineering services firms because billing milestones and project ramp-ups can shift DSOs quarter to quarter, particularly when large deals begin delivery.

Large deals and segment-level indicators

For the quarter, LTTS reported that TCV of large deals exceeded $100 million and included a significant deal valued at $150 million. The sustainability segment was stated to have achieved a quarterly run rate of $100 million and delivered 16.4% YoY growth. The company also disclosed segment margins: mobility segment margin of 15.3%, sustainability segment margin of 27.4%, and tech segment margin of 9% for Q1. These metrics suggest a meaningful margin spread across business lines, with sustainability contributing higher profitability in the data shared.

Guidance and management view for FY26

Management confirmed guidance for double-digit growth in FY26 on a constant currency basis, using Q4 FY25 rates. The company indicated that growth is expected to be more weighted towards the latter half of the year as the business environment stabilises and large deals begin to ramp up. The guidance framing is important because it clarifies that growth expectations depend on conversion of recent wins into revenue and a more stable demand environment.

Share price reference and market context

The article noted that L&T Technology Services share price was ₹4,343 as of 3:30 PM on July 16. Separately, it also referenced a Q4 FY25-26 snapshot showing revenue of ₹2,857 crore and net profit of ₹332 crore (with QoQ and YoY percentage changes listed in the source text). Investors typically compare these quarterly markers with the latest reported quarter to evaluate whether revenue softness is temporary or linked to end-market demand shifts.

Key numbers table: Q1 FY26 vs prior quarters

Detailed quarterly line items provided in the results table

Why the quarter matters for investors

The Q1 FY26 update shows LTTS sustaining double-digit YoY growth in reported rupee revenue, while navigating a weaker sequential quarter in USD terms. The company’s disclosures point to two parallel tracks: near-term delivery impacts from seasonality and automotive-linked softness, and continued deal momentum with large-deal TCV above $100 million. The reported cash and investment balance of ₹2,431 crore provides a buffer, while the negative free cash flow and DSO indicators highlight that collections and timing effects can materially influence quarterly cash conversion. For investors tracking engineering services, the combination of a 13.3% EBIT margin and the stated FY26 constant currency guidance are central reference points, particularly as large deals move from signing into execution.

Conclusion

LTTS delivered Q1 FY26 revenue of ₹2,866 crore and net profit of ₹315.7 crore, with EBIT margin at 13.3% and continued large deal wins above $100 million in TCV. The company attributed the sequential revenue decline in USD terms to seasonality in SmartWorld and automotive industry challenges, while reiterating double-digit constant currency growth guidance for FY26. The next quarters are expected to reflect how quickly large deals ramp up and whether demand conditions stabilise as indicated by management.