TCS Q3 Net Profit Dips 14% Due to 'Exceptional Items'; Core Business Strong

• TCS reported a 13.9% YoY consolidated net profit decrease to Rs 10,657 crore in Q3 FY26, despite steady revenue growth.
• The profit decline was primarily due to one-off exceptional charges, not weakening core operating performance.
• Excluding these charges, net profit grew 8.5% YoY to Rs 13,438 crore, indicating robust underlying performance.
• Exceptional items included workforce restructuring costs, a Rs 2,128 crore statutory impact from new India Labour Codes (gratuity and compensated absences), and Rs 1,352 crore for a US legal dispute with CSC.
• Operating margin remained stable at 25.2%, and revenue grew 4.86% YoY to Rs 67,087 crore, with strong cash flow and $9.3 billion TCV.

Why It Matters: TCS's Q3 net profit decline was driven by one-off exceptional items; core business performance remains robust.