Refused to commit on q1 weakness growth trajectory.

On Q4 linearity - did the softness/miss to guidance play out only in March or over the course of the entire quarter? And does the FY26 guidance imply normal seasonality?

Two-third of the decline was on account of third-party costs and the revenue related to that. Some of the deals that we had in the pipeline had slipped, so the decline was higher than what we anticipated. The balance was the usual Q4 seasonality and the volume decline. Generally these deals happen towards the end of the quarter and that is where it slipped from. On guidance: we see heightened uncertainty in the environment which is why we gave a 3-point guidance band. Depending on which end of the guidance you are looking at, the seasonality and uncertainty will change, but outside of that we are expecting normal seasonality.

On AI-led transformation - are you infusing AI into existing projects in a way that leads to revenue deflation you have to overcome?

AI is part of all the discussions on the new deals. We are using AI in many of our existing programs. But we are seeing benefits which relate to how we can now use AI with clients in different areas. As a composite, what we saw last year, 4.2% growth, we feel pretty confident that we will see benefits from it even as we see some productivity improvement. So we do not see anything in terms of the revenue on that.

On third-party slipping at quarter-end - how was the volume trend during the quarter, and does it imply third-party contribution will be higher in FY'26?

We had a softer start at the beginning of the quarter from volumes perspective, but did see some recovery in volumes - softer in January which is generally a soft month, then volumes start stacking up. On third-party, we are expecting FY'26 to be lower than FY'25, considering deals signed and the deals in the pipeline. So that is baked in.

What are the underlying assumptions at the top end of the guidance? Any risk of deferrals or ramp-downs in the next quarter? And wage hike impact for Q1?

We always run multiple models leading to top, bottom or middle of guidance. The reason for the 3-point band is uncertainty - at the lower end we baked in further deterioration; at the top end, steady to marginally improving environment. On ramp-downs, we have not really seen any major ramp-downs at this point or major closures of deals; clients are cautious and decision-making is delayed in pockets, but that has been baked into the lower end. On wages: most employees got hikes in January; middle to senior employees will get hike effective 1st of April. The impact has been baked into the guidance range.

On small deal environment - have you seen any change vs a few months back? And on FY26 margins, since growth midpoint slowed vs FY25, how do you offset operating deleverage?

On small deals, at the lower end of guidance we have assumed deteriorating environment, at the upper end steady to marginally improving environment. On margins, last year we had a large comp impact, full-year impact of November comp plus additional January comp; impact from large deals signed previously, 30bps from acquisition. Despite all those headwinds, we improved margins by 50 basis points and rewarded employees better through higher variable pay. We are confident there are opportunities to double down and improve margins. The endeavour for FY'26 is to improve margins from where we are.

What is the inorganic contribution contemplated in FY'26 outlook? And how would you characterize the pricing environment?

The guidance does not include the acquisition announced today. The Board has approved the acquisition. We still have to go through closing formalities that will take a few weeks to maybe a month. On pricing, we continue seeing stable pricing through the quarter at the overall business level. Everything that has changed in the environment has been very recent, so we have not really seen any significant impact on pricing. One key pillar of cost optimization/margin improvement is value-based selling - including change requests for scope creeps, rotating long-tenured employees across projects to get better pricing, differentiated pricing models for different services. All of that helped last year and that endeavour continues this year.

On improvement in discretionary spending called out through FY'25 - what did you see in March and April so far?

March month has been usual. I do not think we have seen a significant change either ways in the environment in terms of volumes. We did have positive volumes in March.

On third-party items that spilled over - is that a deferral that will come back in Q1, or is it lost? How does Q1 visibility compare to last year? And why was margin uplift only ~30bps despite two-third of decline being from third-party?

Two-third of our decline was because of lower third-party costs and revenue; some of those deals slipped. It is uncertain at this point if and when these deals come back. Read in conjunction with the fact that FY'26 third-party cost and revenue are going to be lower than FY'25. On Q1 visibility - both years had unique uncertainty factors (last year: interest rates, geopolitical, elections; this year: tariffs). Hard to put in quantifiable terms whether similar or not. Our philosophy is to reduce asymmetry of information - we are guiding what we see today. On margins, the margin uplift on the third-party reduction is around 20 basis points; the reduction in third-party cost is $100 mn. We make some margins on those deals, so the benefit is only the delta margin of the company versus those third-party deals.

In an uncertain macro, will clients double down on outsourcing/cost-takeout deals? Is 1H>2H seasonality still expected in FY'26? And the 40bps M&A headwind - is it one-off, and what is the contribution from acquisitions if closed in Q1?

Changes in the economic environment are recent and in a short period. Learning from the past, this sort of environment will provide more cost takeout opportunities, consolidation, automation, lean. We have pivoted our sales activities into focusing on more proactive pitches to clients in that area. Our portfolio has the ability for both AI/cloud and cost takeout - now we are emphasizing much more on cost takeout. On seasonality (Jayesh): typically 2H is softer due to furloughs and lower working/calendar days; that part will remain. The 40bps acquisition charge was one-off - we reassessed customer intangibles given softness in German/European auto markets. If acquisitions close in Q1, the benefit would be 40-to-50 basis points for the full year, not baked in the guidance.

How is the Mitsubishi JV different from the one TCS signed earlier? And how does the order backlog/large-deal ramp-up entering FY26 compare to entering FY25?

This is not a new JV. We have inducted Mitsubishi into the existing JV and diluted our share by 2%. It is an endeavour to build a long-term relationship with a large giant in Japan. On order backlog: if you look at the quantum of deals being ramped up in Q4 of the previous year vs now, you will see some difference. But many of those deals were larger and longer duration; mega deals are generally much longer tenure. Most deals signed in FY'24 ramped up in Q4 of FY'24, and we saw the benefit in FY'25; they are pretty much at steady state at this point.

In cost of sales, we have a Rs. 145 crores negative number for consultancy and professional charges - what is driving this? And why is the post-sale customer support reversal so high?

This is an insurance claim received with respect to the cyber event we had last year - $20 mn benefit. Did not call it out in margin walk because there were other negatives like utilization that offset it. On post-sale customer support, there is seasonality - typically reduction in Q4 as many projects come to an end with the financial year-end. Plus Project Maximus drives effort optimization, change request, tighter project control - reflects in lesser warranty/SLAs and lesser cost on PSCS.

Are there any silver linings to the current macro/tariff situation - any client conversations on supply chain solutions? And do clients have a separate budget for Gen AI/AI or is it from savings on normal projects?

Our portfolio has both growth (AI, cloud, digital) and cost/efficiency solutions (automation, productivity from AI, lean). We are making sure those are getting communicated and discussed with clients in this short timeframe. On supply chain - we have a consulting business that can give insights, plus supply chain tech solutions if clients are rerouting or optimizing supply chains. On AI budgets - last year overall tech budgets were there. In some cases, clients fund AI transformation from large opportunities on consolidation/cost efficiency. AI was initially distributed within companies, but my guess is it will become more and more one budget for the company from which there will be spend on services for AI.