Newgen Software Technologies reported a 5.4% year-on-year revenue growth for the second quarter of fiscal year 2027, reaching ₹422 crore. The company highlighted strong performance in its international markets, particularly EMEA and the US, while facing subdued conditions in India and APAC. Recurring revenue streams, including SaaS and support, continue to show robust growth, contributing to a healthy annuity revenue mix. Newgen also emphasized its focus on AI-led solutions and ongoing investments in platform innovation to drive future expansion.
Newgen Software Reports Q2 FY27 Performance
Newgen Software Technologies Limited announced its financial results for the second quarter ending September 30, 2026 (Q2 FY27), demonstrating continued earnings growth and strengthening revenue quality. Total revenues for the quarter grew by 5.4% year-on-year to ₹422 crore. For the first half of the fiscal year, revenues reached ₹779 crore, marking an 8.8% growth rate.
Geographic Performance and Revenue Streams
The growth in Q2 FY27 was predominantly driven by international markets. The EMEA region saw a significant recovery, posting a 19.4% growth, supported by enterprise automation demand. The US region continued its momentum with a 17.1% growth, attributed to improved subscription sales and market penetration. Conversely, the India and APAC regions experienced declines of 12.6% and 6.4% respectively, attributed to timing and execution variability, with expectations for improvement in coming quarters.
Recurring revenue streams exhibited strong progress, with SaaS revenue growing by 36.4%, support by 10.3%, and ATS by 7.9%. Overall annuity revenues grew by a healthy 15%, underscoring sustained customer engagement.
Product and Deal Highlights
During the quarter, subscription revenue surpassed license revenue, enhancing business predictability. License revenue saw a year-on-year decline of 19.2% against a strong base in Q2 FY26. Implementation revenues recovered sequentially. Notable wins include an agreement with a US health insurance company for the NewgenONE Complaints, Appeals, and Grievances solution valued at USD 5.5 million over three years, and a deal with a government body in Qatar for platform licenses and implementation worth USD 1.8 million.
Newgen also introduced its AI component, NewgenONE AI Studio of Agent Studio 1.0 and Agent Flow 2.0.2, enhancing its governed AI platform capabilities. The company secured nine new logo additions during the quarter and received recognition for excellence in low-code and AI-led enterprise innovations.
Profitability and Future Outlook
Profit after tax for the quarter grew by 6.3% to ₹87 crore, with EBITDA increasing by 6.5% to ₹109 crore. The company maintained resilient margins, with EBITDA margin at 25.8% and PAT margin at 20.6%. Newgen is focusing on sustaining momentum in EMEA and the US, improving deal conversion in India and APAC, scaling SaaS and annuity revenues, and maintaining cost discipline while selectively investing in sales, product innovation, and AI.
The company reiterated its target of double-digit growth for the full fiscal year. Investments in vertical AI offerings for banking, insurance, healthcare, and government are a key focus, with a projected net margin range of 20%-22% for the year.
Source: BSE
