L&T Technology Services (LTTS) posted a muted April-June quarter earnings with revenues declining to Rs 2,866 crore (down 3.9% QoQ) while net profit rose 1.5% to Rs 316 crore. Despite the slow start, the company remains bullish about a stronger second half, on the back of a robust large deal pipeline, expansion in high-margin sustainability offerings, and growing demand in AI-led engineering. CEO & MD Amit Chadha tells Ojasvi Gupta how the company is managing near-term challenges while staying focused on its $2 billion revenue goal. Excepts:
Q Your Q1 revenue fell while profits grew marginally. What caused the topline dip and how are you addressing it?
This quarter, we saw softness in our mobility segment and seasonal weakness in our smart world business. Despite that, our multi-vertical strategy helped maintain resilience. Sustainability, now our most profitable segment, crossed a $100 million quarterly milestone, growing 16.4% YoY and over 4% sequentially. That momentum, combined with steady growth in North America and Europe, gives us confidence. We are deepening investments in AI, digital engineering, and green innovation, all of which should translate into stronger performance in the coming quarters.
Q You have indicated optimism for a better H2. What’s driving that confidence?
We have entered FY26 with a strong order book and large deal momentum intact. For the third straight quarter, we crossed $200 million in large deals (total contract value). Discussions around AI, next-gen product development, and digital infrastructure are translating into substantial deal opportunities across verticals, particularly in hi-tech and sustainability. That healthy funnel gives us confidence in delivering broad-based growth in the second half.
Q How are you tackling rising costs, especially with employee and overhead expenses rising?
We have managed to maintain stable Ebit margins despite topline pressure by keeping a close watch on our cost levers and maintaining a healthy employee pyramid. We are also deploying our proprietary AI-led framework, PLxAI, to boost productivity and reduce time-to-market for clients. These automation-led efficiencies will continue supporting margins and we are confident of margin improvement as revenue growth becomes more broad-based.
Q Sustainability is now your highest-margin business. What’s driving that growth on the ground?
It’s a combination of long-term strategic deals and AI-led value. We have signed a major contract with a global energy giant involving digital and data services, and we are partnering with Tennant Company on sustainability-focused product development. There’s strong demand for greenfield and brownfield capex programmes in oil & gas and consumer packaged goods. More than half of the large deals we signed this quarter were in sustainability. And as one of the very few pure-play engineering firms delivering scalable sustainability solutions, we are well positioned to lead this space.
Q What does FY26’s projected double-digit growth look like in practical terms?
We are targeting medium-term outlook of $2 billion, up from our current $1.5 billion run rate, and that growth will be spread across verticals, geographies, and deal sizes. Our $50 million-plus deal pipeline is robust, and the backlog has been growing every quarter. The diversity of our portfolio across segments, sustainability, hi-tech, transportation, ensures our growth is balanced, not concentrated.
Q Mobility is under pressure. Are you looking to re-balance the business more toward resilient segments?
Mobility is facing temporary macro headwinds but we expect recovery after a couple of quarters. Meanwhile, the strength of our diversified portfolio is what anchors our stability. Sustainability and hi-tech are already showing strong year-on-year growth. Our balanced approach is deliberately built to handle such cyclicality and it’s a key pillar of our growth strategy.
Q Should we expect any new acquisitions or major strategic investments in FY26?
We are always evaluating strategic plays, especially if they boost capabilities or extend our geographic reach. We recently opened an engineering design Centre in Plano, Texas. It’s focused on AI, cybersecurity, and digital manufacturing, and allows us to be closer to our US clients. On the M&A front, we will continue to explore opportunities that can add long-term value and align with our roadmap.