HCL Technologies Q1 Preview: Revenue, Net Profit Expected to Decline Amid Seasonal Weakness

HCL Technologies is expected to report a 3.76% decline in net profit for Q1, sequentially, due to seasonal weakness and productivity pass-through. Revenue is expected to fall 0.02% QoQ to ₹30,240.28 crore, and net profit is expected to decline to ₹4,145.13 crore. Margins are likely to decline sequentially due to productivity resets and a decline in the services business.

Indian software giant HCL Technologies is gearing up to report its first-quarter (Q1) FY26 earnings, with analysts expecting a 3.76% decline in net profit compared to the previous quarter. The company is anticipated to report a 0.02% quarter-over-quarter (QoQ) decline in revenue, reaching ₹30,240.28 crore, while net profit is expected to drop to ₹4,145.13 crore [1].

The earnings report comes amidst broader industry trends, with Indian software leaders like HCL Technologies and Tech Mahindra expected to reveal insights into the sector's future. According to Jefferies analysts, quarterly sales across India's computer services and IT firms are projected to have slid 0.6% sequentially, primarily due to softer seasonal performance [2].

HCL Technologies' Q1 results are expected to be influenced by several factors. Seasonal weakness and productivity pass-through are cited as the primary reasons for the anticipated decline in net profit. Additionally, the company's margins are likely to decline sequentially due to productivity resets and a decline in the services business.

Despite the expected challenges, HCL Technologies has shown resilience in recent quarters. The company has reported strong deal wins and is set to benefit from its upcoming semiconductor joint venture with Foxconn, which could serve as a long-term tailwind [1].

Investors and financial professionals are advised to closely monitor the key support and resistance levels around ₹1,660–₹1,670 and ₹1,720–₹1,740, as identified by SEBI-registered research analyst Vijay Kumar Gupta. A decisive breakout above ₹1,740 would confirm bullish continuation, while a breach below ₹1,660 could open downside zones around ₹1,600 and ₹1,500–₹1,480 [1].

In conclusion, HCL Technologies' Q1 FY26 earnings report is set to provide valuable insights into the company's performance and the broader Indian software sector. Investors should closely follow the earnings release and the subsequent market reaction to gauge the potential impact on the stock.

References:
[1] https://stocktwits.com/news-articles/markets/equity/hcl-tech-needs-1-740-breakout-for-bulls-to-take-charge-sebi-ra-vijay-kumar-gupta/chFUM4xR5i0
[2] https://www.bloomberg.com/news/articles/2025-07-11/india-s-hcl-technologies-tech-mahindra-lift-veil-on-it-industry-outlook