Birlasoft (BSOFT) Q3 24/25 earnings summary

Executive summary

• Q3 was seasonally weak with higher-than-usual furloughs, impacting revenue and extending into January, with demand environment largely unchanged.

• Revenue grew 1.5% year-over-year to ₹13,627 million ($160.8 million), with EBITDA margin steady at 12.0% despite wage hikes and operational headwinds.

• Total contract value (TCV) of deals signed reached $226 million, up 66% sequentially and 4% year-over-year, marking the highest for the year, mainly from renewals but also some new wins.

• Cash and cash equivalents rose 21.7% year-over-year to ₹20,552 million ($240 million), supported by strong collections and improved DSO to 53 days.

• Management is focused on restoring predictability and sequential growth, with continued investments in AI, GenAI, data, and product engineering to bridge capability gaps and drive future growth.

Financial highlights

• Consolidated Q3 revenue: ₹13,627 million ($160.8 million); constant currency degrowth of 0.1% year-over-year and 1.1% quarter-on-quarter.

• EBITDA: ₹1,634 million ($19.3 million), margin at 12.0%, marginally lower than Q2.

• PAT: ₹1,169 million ($13.8 million), down 9.3% quarter-on-quarter; PAT margin at 8.6%.

• Cash and bank balances: $240 million, up 8.2% sequentially and 21.7% year-over-year; operating cash flow at $29.9 million (155% of EBITDA).

• DSO at 53 days, among the best in the industry.

Outlook and guidance

• Demand environment remains cautious, with some green shoots in BFSI and discretionary spend, but broad recovery expected only in the latter part of the calendar year.

• Q4 expected to face continued, though reduced, furlough and project rundown headwinds; management aims to mitigate impacts and maintain order booking momentum.

• Current order book not sufficient for double-digit growth, but enough for sequential growth; focus on closing new deals and expanding client base.

• Margin improvement remains a priority, with ongoing cost optimization and operational initiatives.

• Management continues to invest in capability enhancements and partnerships to drive future growth.