Systems (SYS) Q1 2026 earnings summary

Executive summary

• Q1 2026 consolidated revenue rose 32.6% YoY to Rs. 23,977.59M; net profit increased 20.9% to Rs. 3,025.71M, with Confiz included.

• Organic and inorganic growth, efficiency gains and optimization supported results; margins were in line with the prior-year quarter but lower QoQ.

• Integration of Confiz is underway; remaining legal and other steps were targeted for completion by end-June.

• Growth strategy prioritizes AI-enabled services, vertical focus, export revenue and expansion in North America and Europe.

Financial highlights

• Revenue was Rs. 23,977.59M versus Rs. 18,080M in Q1 2025; USD revenue rose 33% YoY to $85.78M.

• EBITDA was Rs. 3,858M versus Rs. 2,891M; USD EBITDA rose 34% to $13.80M, with a 16% margin.

• Gross profit increased 32.7% to Rs. 6,038.17M; gross margin was 25.2%, down from 30.4% in the previous quarter.

• Operating profit rose 26.3% to Rs. 3,116.24M, with a 13% operating margin.

• Standalone revenue grew 15.5% to Rs. 12,585.02M; net profit rose 1.3% to Rs. 2,032.41M.

Outlook and guidance

• No exact CY26 growth target was provided; management expressed confidence in the trajectory, subject to geopolitical developments.

• Gross margin is expected to improve in Q3 and Q4 as quarter length normalizes, initial cost increases are absorbed and newer geographies contribute, assuming regional conditions settle.

• Confiz synergies and North American direct-market access may take time, with progress expected in H2; cross-sell and up-sell target North American enterprise clients.

• Growth plans focus on existing clients, new customers and diversified regional revenue; UK operations are expected to become fully operational later in the year.

• Global business-process work targets Record-to-Report, marketing and HR; APAC plans include stronger sales capability and evaluation of a Malaysia delivery center.