Sonata Software Ltd is primarily engaged in the business of providing Information Technology (IT) Services and Solutions to its various customers in the United States of America, Europe, Middle East, Australia and India. Presenting below are its latest Q1 FY26 earnings.
Q1 FY26 Earnings Summary (Apr–Jun 2025)
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Consolidated Revenue: ₹2,965.2 crore, up 13.3% quarter-over-quarter (QoQ) and 17.3% year-over-year (YoY).
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EBITDA (before other income and forex): ₹159.6 crore, down 7.6% QoQ.
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Consolidated Net Profit (PAT): ₹109.3 crore, up 1.7% QoQ and 7.4% YoY.
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First Interim Dividend: ₹1.25 per share announced.
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International IT Services: Revenue at $81.8 million (+0.6% QoQ). In rupee terms, revenue was ₹699.9 crore (-0.3% QoQ); EBITDA margin at 16.6%; PAT at ₹70.7 crore (+13.5% QoQ).
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Domestic Products & Services: Revenue at ₹2,274.7 crore (+18.6% QoQ); gross contribution declined 12.6% QoQ to ₹68.5 crore; EBITDA at ₹44 crore (-22.1% QoQ); PAT at ₹38.6 crore (-14.6% QoQ).
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Balance Sheet: Gross cash & cash equivalents were ₹600 crore; net cash was negative ₹62.5 crore.
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Metrics: ROCE at 18.5% (Q4 FY25: 21.9%), RONW at 24% (Q4 FY25: 25.2%).
Key Management Commentary & Strategic Highlights
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Execution Strength: CEO Samir Dhir stated that Q1 marked steady progress, with three large deals signed (two in BFSI, one in TMT), including a $73 million, AI-led digital modernization contract with a leading US TMT company.
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Business Focus: Investments and diversification into healthcare and BFSI have scaled these from 13% to 32% of revenue over three years.
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Growth Strategy: Management emphasized continued investments in cloud-managed services and strong partnerships with top-tier cloud providers to drive future growth.
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Market Trends: Management highlighted balancing client cost containment with demand for digital modernization and platforms, especially leveraging AI (Sonata Harmoni.AI).
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Outlook: The company remains positive on long-term growth trajectory, supported by a healthy deal pipeline and ongoing cost and operational discipline
Q4 FY25 Earnings Summary (Jan–Mar 2025)
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Consolidated Revenue: ₹2,617.2 crore, down 7.9% QoQ but up nearly 19% YoY.
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EBITDA (before other income and forex): ₹172.5 crore, up 5.8% QoQ.
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Consolidated Net Profit (PAT): ₹107.5 crore, up 2–2.4% QoQ but down 2.6–3% YoY.
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International IT Services: Revenue (Rupees) at ₹702.3 crore, down 4% QoQ; EBITDA at ₹115.7 crore (+8% QoQ); PAT at ₹62.3 crore (+9.5% QoQ).
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Domestic Products & Services: Revenue at ₹1,918.2 crore (-9.1% QoQ); gross contribution at ₹78.4 crore (-4.3% QoQ).
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Metrics: Improved operational efficiency, Days Sales Outstanding (DSO) improved to 61 days.
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Headcount: Over 6,800 employees as of March 31, 2025.
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Dividend: Final dividend recommended at ₹4.40 per share for FY25