Mphasis Ltd, the Bengaluru-based IT services and consulting firm, reported Q3 results on Thursday that showed steady revenue growth alongside Mphasis quarterly profit moderation. Shares of the company were mixed in early trading following the announcement, with broader IT sector sentiment subdued.
Mphasis’ consolidated revenue from operations for the quarter ended December 31, 2025, rose to ₹40,025.79 crore, up 12.4% year-on-year (YoY) and 2.6% quarter-on-quarter (QoQ). Total income for the period was ₹40,649.61 crore. Consolidated profit after tax was ₹4,421.85 crore, reflecting a 3.4% YoY increase but a 5.7% sequential decline from the prior quarter. Results include an exceptional charge related to changes in labour laws. Standalone revenue stood at ₹24,088.29 crore, with profit after tax of ₹3,391.56 crore.
Latest Quarterly Results
Mphasis’ reported operating margin for Q3 FY26 was 15.2%, slightly lower than in the preceding quarter, as cost pressures linked to statutory labour changes weighed on margin expansion. On a constant currency basis, direct revenue grew 1.9% sequentially and 9.6% YoY. The company secured new total contract value (TCV) wins of USD 428 million during the quarter, with a significant portion attributed to AI-led engagements.
Market Capitalization and Share Performance
Mphasis’ market capitalization is broadly estimated in the ₹53,000–₹55,000 crore bracket according to latest share price figures, as the stock hovers near ₹2,800 across key Indian exchanges. Key valuation indicators reveal a trailing P/E ratio of about 30x, alongside a dividend yield close to 2%. Lately, derivatives trading has exhibited increased open interest levels, signalling stronger market participation amid fluctuating price movements.
Business and Operations Update
Mphasis continues to position itself as an AI-led, platform-driven technology partner for global enterprises, with its Mphasis NeoIP™ suite cited by management as central to accelerating digital transformation deals. Vertical traction was noted across financial services and insurance segments, with sequential growth in key client geographies.
Strategic Moves and M&A Activity
In mid-January 2026, Mphasis’ wholly owned UK subsidiary completed the acquisition of the remaining 49% stake in Mrald Limited, converting the venture into a wholly-owned step-down subsidiary. This move underscores Mphasis’ focus on strengthening its digital insurance and reinsurer support capabilities in Europe.
Earlier in 2025, the company expanded its AI ecosystem through a minority stake investment in Aokah Inc., a US-based AI platform provider, aimed at enhancing capabilities for global capability centres and AI-driven transformation services.
Outlook
On the investor call accompanying the results, management reaffirmed its commitment to double-digit growth and to converting strong TCV wins into revenue over the remainder of FY26. The company cited its AI-enabled platforms and automation-focused delivery model as key levers for future expansion. Forward outlook emphasised focus on large deal ramp-ups, wallet share gains with existing clients, and disciplined cost management.
Summary
In Q3 FY26, Mphasis recorded sequential revenue growth and year-over-year profit gains, counterbalanced by non-recurring expenses and margin strain. Ongoing strategic acquisitions and AI investments are expanding the company’s service lineup.