This article first appeared on GuruFocus .
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Revenue:INR 510.1 crore, growth of 19.9% YoY and 4.1% QoQ.
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EBITDA:INR 96.2 crore, growth of 76.4% YoY and 8.3% QoQ.
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EBITDA Margin:18.9%, improvement of 604 basis points YoY and 75 basis points QoQ.
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EBIT:INR 74.2 crore, up 7.7% QoQ and 65.9% YoY.
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EBIT Margin:14.6%, improvement of 404 basis points YoY and 50 basis points QoQ.
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Net Profit (PAT):INR 36.4 crore, down 42.5% QoQ due to a one-time labor cost impact.
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PAT Margin:7%, would have been approximately 12.7% excluding one-time impact.
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EPS:INR 6.16 per share.
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Digital Technologies Revenue:INR 169.6 crore, up 10.8% QoQ.
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Digital Operations Revenue:INR 273.8 crore, up 0.5% QoQ.
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Digital Experiences Revenue:INR 66.7 crore, up 3.2% QoQ.
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Geographical Revenue Distribution:US 52%, UK and Europe 22%, India 17%, ROW 9%.
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Net Cash and Investments:INR 540.2 crore as of December 2025.
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Warning! GuruFocus has detected 2 Warning Signs with BOM:532528.
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Release Date: January 29, 2026
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
Positive Points
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Datamatics Global Services Ltd ( BOM:532528 ) reported a strong revenue growth of 19.9% year-on-year and 4.1% quarter-on-quarter.
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The company achieved an impressive EBITDA growth of 76.4% year-on-year and 8.3% quarter-on-quarter, with an EBITDA margin improvement of 604 basis points year-on-year.
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Datamatics is investing in Enterprise AI and has rolled out Google Gemini Enterprise across the organization, enhancing productivity and innovation.
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The company has successfully integrated TNQ Technologies, contributing to a sequential quarter-on-quarter growth of 4%.
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Datamatics maintains a healthy balance sheet with net cash and investments standing at INR540.2 crore as of December 2025.
Negative Points
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The digital experiences segment showed softness due to two clients transitioning work to captive centers, impacting margins.
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A one-time increase in labor costs due to changes in labor codes resulted in a significant impact on profitability, with PAT down by 42.5% quarter-on-quarter.
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The US market remains lukewarm due to political uncertainties, affecting business sentiment.
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The company anticipates a softer Q4 for digital experiences, with full recovery expected only in Q1 of the next fiscal year.
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Despite strong growth figures, the company remains conservative in its outlook for FY27, projecting high single-digit growth due to uncertainties in the market.
Q & A Highlights
Q: How should we see the three segmental revenue mix evolve in the next couple of quarters, and can you provide insights on digital experiences which have shown some decline? A: Digital experiences will remain soft in Q4 due to client transitions to captive centers, but we expect an upswing from Q1 next year with new logos and healthier margins. Digital technologies and operations are robust, with a healthy pipeline and improving margins, especially with AI transitions.
Q: Can you provide details on the Google Gemini enterprise solutions and their impact on revenue? A: We are implementing Google Gemini across Datamatics to enhance productivity and efficiency. While revenues from these AI solutions will flow in the next few quarters, the initial response has been promising. The focus is on democratizing AI within the organization.
Q: What is the impact of the new labor codes on financials, and will there be further impacts? A: The labor code changes resulted in a one-time increase in gratuity and leave encashment liability, impacting this quarter. Going forward, the impact will be minimal and routine.
Q: How is the integration of TNQ Technologies progressing, and what is its impact on growth? A: TNQ is integrating well, contributing to sequential quarter-on-quarter growth. The growth is not solely from the acquisition, as organic growth remains strong. TNQ's performance aligns with the rest of Datamatics.
Q: What is the outlook for FY27 in terms of growth, and which segments will lead this growth? A: We anticipate high single-digit growth, driven across all three segments, with digital technologies likely leading. The growth outlook is conservative due to uncertainties, but we remain optimistic about our strategic initiatives.
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
