Persistent Systems (PERSISTENT) Q2 25/26 earnings summary

Executive summary

• Achieved revenue of $406.2 million in Q2 FY26, up 4.2% QoQ and 17.6% YoY, marking the 22nd consecutive quarter of growth and strong operating margin of 16.3%.

• AI-led platform strategy accelerated enterprise transformation and productivity, with significant internal and client-facing deployments.

• Recognized for growth, talent excellence, and AI leadership by Everest Group, ISG, and Gartner.

• Net profit for the six months ended September 30, 2025, was ₹8,387.04 million, up from ₹5,337.53 million YoY.

• The company completed the merger of Capiot Software Private Limited and acquired the service business of Starfish Associates LLC.

Financial highlights

• Q2 FY26 revenue: $406.2M, up 4.2% QoQ and 17.6% YoY; TTM revenue: $1,531.3M, up 19.2% YoY.

• EBIT margin reached 16.3%, a 230 bps YoY improvement; PAT margin at 13.2%; EPS up 43% YoY to INR 30.3.

• Operating cash flow to PAT stood at 114.3%; total cash and investments at INR 24,957 million as of September 30, 2025.

• Return on capital employed rose to 45.5%; ROCE: 38.1%; ROE: 25.3%.

• Billed DSO improved to 54 days; unbilled DSO at 21 days.

Outlook and guidance

• Management remains confident in achieving the $2 billion revenue target by FY27, citing a strong pipeline and broad-based growth.

• Margin expansion of 200–300 bps over two to three years remains on track, with 100 bps improvement expected in FY26 and another 100 bps in FY27.

• Wage hikes effective October 2025 expected to impact margins by 180 bps next quarter, partially offset by other levers.

• Continued focus on AI-led transformation, platform-driven services, and scaling with ecosystem partners.

• Ongoing investments in talent, partnerships, and innovation to sustain growth.