India’s leading information technology companies are expected to report another muted set of quarterly results, as weak demand from the United States and client shutdowns during the holiday period continue to drag on technology spending, according to forecasts from nine brokerages.
The top six Indian IT firms by revenue are projected to post average year-on-year revenue growth of about 4% and profit growth of roughly 5% for the December quarter. This marks a slowdown from the September quarter, when revenue growth averaged 6.5%, highlighting the persistence of demand softness. Indian software exporters last recorded double-digit revenue growth in the March quarter of 2023, during the post-pandemic surge in cloud adoption, digital transformation, and remote work.
The broader $283 billion Indian IT industry continues to face macroeconomic headwinds, including uncertainty over U.S. trade tariffs, concerns around proposed $100,000 U.S. visa fees, and cautious client spending amid fears of slower growth in the world’s largest economy. The United States remains the most critical market for Indian IT firms, accounting for a substantial share of sector revenues.
While sector bellwether Accenture recently beat Wall Street expectations on AI-led demand, its unchanged growth outlook underscored the near-term caution facing the industry. Indian IT firms, though lacking pure-play AI companies, are increasingly shaping AI strategies through acquisitions and partnerships. Brokerages expect AI-related momentum to build gradually over the next six months, with a more meaningful pickup in demand heading into 2026.
“Clients remain cautious about committing incremental spending to large programs amid macro and tariff uncertainty and a new tech cycle,” said Abhishek Pathak, research analyst at Motilal Oswal Financial Services.
Uncertainty around U.S. tariffs, visa policies, and subdued client spending contributed to record foreign outflows of $8.5 billion from Indian IT stocks in 2025, accounting for nearly half of total foreign exits from Indian equities. Reflecting these pressures, the Nifty IT Index fell 12.6% in 2025, making it the worst-performing sector as Indian markets lagged Asian and emerging-market peers.
Earnings season will begin on January 12 with Tata Consultancy Services, whose revenue is expected to rise about 4.2% year-on-year, slower than the 5.6% growth reported a year earlier. Infosys and HCLTech are forecast to post revenue growth of around 8.1% and 4.6%, respectively. Most brokerages do not expect either company to upgrade their fiscal 2026 revenue guidance.
Despite the weak outlook for IT, earnings across broader Indian equities are expected to improve in the December quarter, supported by tax cuts, policy easing, stable growth, and benign inflation. For IT firms, however, fewer working days due to global holidays, furlough-related margin pressure, and wage hikes at companies such as Wipro are likely to continue weighing on performance.
Analysts said resilience in the BFSI segment, deal ramp-ups, early signs of AI strategy execution, and a weaker rupee could begin to support the sector by mid-2026.
