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Tech Mahindra has joined Tata Consultancy Services (TCS) and HCL Technologies in expanding its workforce, adding nearly 5,500 employees in the September quarter. This marks the Pune-headquartered IT services firm’s first quarterly headcount addition in four quarters and its highest quarterly increase in two years.
Barring the second quarter of FY26 and the latest quarter, Tech Mahindra reported a decline in employee count in every quarter over the past two years. Its total headcount stood at 1.52 lakh at the end of September, significantly above Bloomberg consensus estimates of 1.49 lakh.
The management attributed part of the increase to employee transfers in certain geographies linked to the large Orange deal, cautioning against drawing broader conclusions from a single quarter’s numbers.
Despite high utilisation levels, the company expects artificial intelligence (AI) toolchains being developed across service lines to improve headcount efficiencies in fixed-price projects. This, it believes, will help support growth without a proportional increase in employee numbers.
Attrition at Tech Mahindra continued to ease. Its last-twelve-month attrition rate stood at 11.7% in Q2 FY27, down from 12.8% a year earlier and 11.8% in the June quarter.
Employee costs rose 4.5% year on year to ₹8,232 crore during the quarter, accounting for nearly 51% of revenue.
Tech Mahindra reported net revenue of $1,693 million for the September quarter, up 2% sequentially and above CNBC-TV18’s estimate of $1,682 million. Revenue in constant currency terms grew 2.4% quarter on quarter, beating the channel’s forecast of 1.4%. Net profit also exceeded estimates, rising 8.2% sequentially to ₹1,586 crore.
IT sector hiring shows signs of recovery
Tech Mahindra’s latest hiring trend comes as the IT sector navigates subdued discretionary spending and uncertainty over the impact of AI on traditional services. While Wipro reduced its workforce by about 6,700 employees in the September quarter, TCS and HCL Technologies also reported headcount additions.
HCL Technologies added 6,450 employees in Q2 FY27, its highest quarterly addition in 16 quarters. The company reported a record quarterly net profit of ₹5,132 crore, while its headcount reached an all-time high of 2.30 lakh at the end of September.
TCS added nearly 4,300 employees during the quarter, taking its workforce to a five-quarter high of 5.98 lakh. Headcount expanded for the third consecutive quarter, marking the first such streak since Q3 FY23.
Signs of renewed hiring have coincided with a rally in IT stocks. The Nifty IT index gained 8.4% over the past three sessions, compared with a rise of nearly 3% in the Nifty 50 over the same period.
