IT giant LTM expects artificial intelligence linked business to contribute nearly 50% of its total revenue within five years, as reported by NDTV Profit. CEO and MD Venu Lambu stated that as part of their five-year plan, they expect AI revenue to be at 50% of their revenue mix. The company reported AI-related revenue for the first time, estimating it at 12.2% of quarterly revenue at $150 million, giving it a higher AI revenue share than larger peers TCS and HCLTech. According to NDTV Profit, Lambu noted that the momentum is expected to continue in the rest of the fiscal, while the company is focusing on talent transformation, reimagining partner systems, and other strategic initiatives. The company has expanded its partnership with IBM to establish a Global AI Center of Excellence and secured a multi-million dollar digital transformation deal with a major North American healthcare provider in June 2026, which is expected to begin contributing to revenue from Q2 onwards.
On July 11, LTM announced April to June quarter earnings, reporting a 5.47% sequential jump in net profit to ₹1,466 crore, which met analysts' estimates of ₹1,432 crore. As reported by NDTV Profit, the company's consolidated bottom-line in the preceding quarter was ₹1,390 crore. Revenue from operations rose 2.65% to ₹11,600 crore from ₹11,300 crore in the previous quarter, surpassing analysts' expectations of ₹11,544 crore. Earnings before interest and taxes also jumped 5.88% to ₹1,800 crore from ₹1,700 crore, in-line with D-Street expectations of ₹1,744 crore. The company's margin expanded to 15.5% in the quarter under review, from 15.14% in Q4 of fiscal 2026, representing a 36 basis points improvement that shows effective cost management and operational efficiency. The profit growth of 5.5% QoQ indicates a recovery in execution efficiency compared to the previous quarter's stabilizing phase.
According to NDTV Profit, LTM's disclosure marks one of the first instances when an Indian IT company has quantified AI revenue as a portion of its overall sales. Compared to other IT giants, AI contributes a higher share in LTM's revenue. Notably, TCS generates higher AI revenue in absolute terms but contributes a lower share of its business at about 8.5% of annualised revenue, while HCLTech's AI business contributed $155 million, or 4.2% of quarterly revenue. The company has entered into a strategic collaboration with Anthropic to integrate Claude AI models into its internal processes and client solutions, which is expected to reduce project timelines and improve accuracy of automated business insights by 15-20% for specific modules. The company has focused on upskilling over 30,000 employees in AI-first workflows, preceding the Anthropic collaboration announcement. The positive earnings surprise is likely to provide a sentiment boost to the broader Nifty IT index.
Management has upgraded its FY27 guidance to exceed the 6% growth floor achieved in the previous fiscal year, indicating confidence in accelerated performance. The 36 basis points margin expansion to 15.5% reflects reduced sub-contracting costs and improved utilization, serving as a benchmark for mid-to-large cap IT services. The consistent sequential revenue growth of 2.65% suggests stability in large deal execution, while the emphasis on H2 acceleration points toward a back-ended growth trajectory for FY27. The Indian IT sector is currently witnessing a transition from pure-play cost arbitrage to value-added AI integration, with LTM's results aligning with the broader industry trend of consolidating vendors and focusing on operational efficiency to offset slower decision-making cycles in North American markets. The margin expansion in Q1 sets a positive tone for the 'accelerated expansion' predicted for the second half of the year.
