Tata Communications reported a significant rise in net profit for the second quarter of fiscal year 2027 (Q2 FY27), answering the question of how the company performed financially during this period. The company’s net profit increased by 86%, supported by strong revenue growth and improved profitability across its business segments.
- Net profit rose 86% in Q2 FY27 compared to the previous year.
- Revenue from operations increased 9.6% year-on-year to ₹6,688 crore.
- EBITDA grew 21% to ₹1,422 crore with margin expanding to 21.26%.
- Digital platform revenue grew 18.6% year-on-year.
- Data revenue increased by 12.2% in the quarter.
- Board approved restructuring of Kaleyra, Inc. ownership.
What were the key financial highlights for Tata Communications in Q2 FY27?
Tata Communications’ revenue from operations increased by 9.6% year-on-year to ₹6,688 crore in Q2 FY27, up from ₹6,100 crore in the same quarter last year. The company’s total income rose 10% to ₹6,704 crore compared to ₹6,083 crore in Q2 FY26.
Operating profit, measured as earnings before interest, taxes, depreciation, and amortisation (EBITDA), jumped 21% to ₹1,422 crore from ₹1,174 crore in the previous year’s quarter. The EBITDA margin expanded from 19.24% to 21.26%, marking the highest EBITDA and fastest growth recorded by the company for a quarter.
How did digital and data revenues perform during the quarter?
The company’s digital platform revenue grew 18.6% year-on-year, reflecting strong demand for digital services. Data revenue also increased by 12.2%, showing continued growth in connectivity and data-related offerings. Digital losses were reduced by half compared to the previous quarter, with digital margins improving to -3.6%.
What did the company’s leadership say about the results?
Ganesh Lakshminarayanan, Managing Director and CEO of Tata Communications, expressed satisfaction with the quarter’s performance. He highlighted the company’s improved profitability and the role of its Unified AI Stack in driving growth by connecting enterprise intelligence with enterprise action. He also noted strong demand for data center-to-data center (DC-to-DC) connectivity, which leverages the company’s extensive network assets.
What were the half-year (H1 FY27) results?
For the first half of FY27, Tata Communications’ net profit increased by 27% to ₹475 crore from ₹373 crore in the same period last year. Revenue from operations for H1 FY27 stood at ₹13,271 crore, marking a 10% growth compared to ₹12,060 crore in H1 FY26.
What corporate actions did the Board approve?
The Board of Directors approved the transfer of the company’s entire shareholding in Kaleyra, Inc. to Tata Communications (Netherlands) B.V., a wholly-owned subsidiary. This restructuring aims to simplify the group structure by consolidating ownership under the subsidiary without changing the ultimate ownership or economic interest in Kaleyra, Inc. The company will subscribe to and acquire ordinary shares of the subsidiary at fair market value based on an independent valuation.
How did the market react to the earnings announcement?
Following the earnings release, Tata Communications’ shares rose sharply by 11.19% on the National Stock Exchange, reaching ₹1,844.5 per share. The company’s market capitalization stood at ₹52,675.27 crore, reflecting investor confidence in its performance and growth prospects.
In summary, Tata Communications demonstrated strong financial and operational performance in Q2 FY27, driven by growth in digital and data revenues, improved profitability, and strategic initiatives in AI and connectivity. The company’s leadership remains optimistic about maintaining momentum in the second half of the fiscal year.
