Birlasoft’s Q2 FY27 earnings conference call revealed a 2.1% sequential revenue growth in constant currency and dollar terms. Management highlighted strong performance in Life Sciences and ERP verticals, robust cash flows, and a 9% year-on-year increase in deal signings (TCV). The company discussed investments in AI capabilities and a positive outlook for the second half of FY27, anticipating better performance than the first half despite expected Q3 furloughs.
Birlasoft Q2 FY27 Earnings Call Highlights
In the Q2 FY27 earnings conference call held on October 28, 2026, Birlasoft Limited reported a sequential revenue growth of 2.1% in both constant currency and dollar terms, translating to 2.7% growth in rupee terms. The company noted that the Life Sciences and ERP business verticals achieved their second consecutive quarter of sequential growth. Manufacturing and BFSI businesses also witnessed sequential growth, while the E&U vertical remained soft due to a client ramp-down.
Financial Performance and Deal Wins
The EBITDA margin for the quarter was reported at 15.2%, which the company stated was within the previously indicated range, despite an organizational-wide compensation revision effective July 2026. Robust cash flows, improved collections leading to a 2-year best DSO of 51 days, and a healthy cash balance of $300.4 million were also highlighted. Deal signings for the quarter reached $116.1 million TCV, a 9% year-on-year increase, with the first half showing a 15% year-on-year uptick to $285 million. Angan Guha, CEO & MD, mentioned several AI-led engagements secured during the quarter, including a strategic AI-led transformation opportunity with a European logistics organization and a 3-year AI-led managed services engagement for a global industrial manufacturer.
AI Investments and Future Outlook
Birlasoft emphasized its growing base of engagements deploying advanced AI-powered capabilities, with investments in both technology and domain areas. The company achieved AWS AI Services Competency status and became an OpenAI select partner. Around a third of its code today is generated using Agentic AI tools. Looking ahead to the second half of FY27 (H2 FY27), management expressed commitment to investing in tech capabilities and the sales organization. Despite expected furloughs in Q3, the company is well-positioned for better financial performance in H2 FY27 due to the pipeline, ongoing conversations, and seasonal uptick in renewals. The outlook for Q4 suggests it could be the strongest quarter of the year, barring unforeseen macro shocks.
Margin Stability and Investments
Regarding margins, the company indicated that while increments impacted margins by about 170 basis points quarter-on-quarter, efforts in operational efficiencies and improved quality of revenue helped offset these headwinds. The target is to maintain EBITDA margins around the 15% level. Investments in sales, service line capabilities, and physical infrastructure are ongoing. The company also noted that the increase in other expenses was primarily due to an increase in complementary workforce for specific client needs.
Vertical Performance and Demand Environment
The BFSI segment continues to be a strong focus area, with growth expected from Q4 onwards. The E&U business softness was attributed to a one-time client ramp-down and is expected to turn around in the next 2-3 quarters. Management described the demand environment as steady, not worsening, but not improving either, with ongoing conversations in the AI space. The company is focusing on securing larger deals and building a strong order book to ensure future growth beyond FY28.
Source: BSE
