• Record order book of $401.8M (up 122.9% QoQ) driven by mega deal win valued at approximately $210M gross
• 85% of workforce AI certified, with AI learning hours per person increasing 136% YoY in FY26
• Annual client satisfaction score improved 470 bps to highest ever level, positioning Zensar in top three of industry CSAT
• Industry-leading attrition at 9.8%, fifth consecutive quarter below 10%
• Net cash position at $319.5M, up 10% YoY, demonstrating strong balance sheet
• Utilization improved to 84.3%, up 80 bps sequentially
• BFSI vertical grew 11% YoY; Healthcare & Life Sciences up 8% YoY
• Service line revenue share increased to 71.6% in Q4, up 40 bps YoY, with Cloud Infrastructure & Security up 13%

Zensar Technologies delivered modest FY26 results with 3.1% revenue growth to $643.7M, while achieving strong profitability (PAT up 13.6% to $87.2M) and record order book of $401.8M driven by a mega deal win. However, significant headwinds persist including TMT sector weakness (down 9.7%), top client revenue attrition, intense tier-one competition, and AI-driven pricing pressures, offsetting positive momentum from AI-native offerings and strong client satisfaction scores.

For Q4 FY26, Zensar reported revenues of $158.4M, representing 1% YoY growth and 1.3% sequential decline in reported currency (1.9% sequential growth in constant currency). Full year FY26 revenues reached $643.7M, up 3.1% YoY in USD terms and 7.7% in INR terms. EBITDA margin for Q4 contracted 130 bps sequentially to 14.4%, impacted by lower working days (30 bps), reversal of Q3 utilization benefits (110 bps), and large deal implementation costs (110 bps), partially offset by positive forex impact (120 bps). Profit after tax for the full year improved significantly to $87.2M, up 13.6% YoY. The company maintained a strong cash position with net cash and equivalents of $319.5M, up 10% YoY. The Board approved final dividend of 12.6 INR per share (630% of face value), bringing total dividend to 750% of face value. ETR for the quarter was 23.7%, and diluted EPS grew 5.6% QoQ.

Management struck a cautiously optimistic tone, acknowledging significant macro and sector-specific headwinds while emphasizing strategic positioning and execution discipline. CEO Manish Tandon repeatedly stressed the company's 'all-in on AI' strategy, highlighting that 85% of workforce is AI certified and that AI components are now embedded in virtually every deal. Management emphasized their focus on creating shareholder value through profitability and EPS growth even when revenue growth is constrained. The mega deal win was positioned as validation of their AI-native capabilities and proof they can compete at scale. However, management was notably transparent about challenges, particularly TMT sector weakness, top client attrition, and intense competitive pressure from tier-one players now bidding on deals they previously wouldn't consider. The repeated mention of 'geopolitical uncertainty and sudden policy shifts' as the 'new normal' suggests management is preparing stakeholders for continued volatility. Management's decision to maintain mid-teens margin guidance (14-16%) while acknowledging Q1-Q2 margin pressure from mega deal transition costs demonstrates balanced expectations.

Zensar faces multiple significant headwinds. The TMT vertical declined 9.7% YoY and management expects continued pressure for 'next few quarters,' with their top client facing ongoing revenue attrition due to insourcing and cost-cutting (Oracle laid off 30,000; Snap and Box cut ~50% of workforce). Competitive intensity has dramatically increased, with tier-one players now bidding on deals they previously ignored, creating unprecedented pricing pressure. Healthcare & Life Sciences is expected to be 'under stress' in FY27 due to consolidation by multiple clients. The mega deal, while positive, creates execution risk with significant transition costs expected in Q1-Q2 and full revenue recognition not expected until Q3. AI is creating a dual challenge: clients are repurposing AI spend from existing engagements (application development and testing), creating 'pressure on renewals and pricing,' while requiring continuous investment in upskilling and new service development. Immigration policy tightening adds operational complexity. Management acknowledged the Manufacturing, Consumer Services vertical declined 0.6% YoY. The company's lack of annuity-based contracts means they must 'earn business and client trust quarter after quarter,' creating revenue volatility. Geopolitical uncertainty and tariff impacts were mentioned as making forward prediction 'very difficult.'

Revenue Outlook: Management expects no degrowth in Q1 but avoided specific revenue guidance due to rapidly changing environment. TMT will remain under pressure for next few quarters. BFSI expected to grow. Healthcare & Life Sciences targeted to remain flat in FY27. Manufacturing, Consumer Services expected to show some growth. FY27 performance will be heavily contingent on mega deal execution with full ramp expected in Q3.

Margin Outlook: Mid-teens (14-16%) maintained for full year FY27, though Q1-Q2 will see margin pressure from mega deal transition costs. Management emphasized willingness to trade margins for growth if needed.

Key Targets:

• Order book maintained above 1.1x (anything between $180-200M quarterly considered reasonable excluding mega deals)
• Maintain industry-leading attrition below 10%
• Continue AI workforce certification and capability development
• Scale mega deal successfully with material revenue recognition from Q3 FY27
• Expand addressable market into adjacent areas (CMO, BPO, operations, HR, finance) using AI

The Q&A session revealed analysts primarily focused on three themes: (1) understanding the drivers and sustainability of the revenue weakness in Q4 and outlook for FY27, (2) details on the mega deal ramp-up timeline and financial impact, and (3) how AI and competitive dynamics are reshaping the business model. Management was notably transparent about challenges, particularly TMT sector stress and tier-one competition, while emphasizing their AI-first strategy and ability to compete through agility and specialized offerings. Analysts pressed multiple times for quantification of mega deal revenue contribution and margin impact, which management largely declined to provide, citing execution focus and transition complexity. Concerns around decision-making delays, client budget impacts from tech layoffs (Oracle 30K, Meta, Microsoft cuts), and AI-driven deflation were prominent. Management consistently redirected conversation to their differentiation through AI-native capabilities, industry-leading CSAT scores, and ability to expand addressable market. The tone was realistic rather than defensive, with CEO Manish Tandon acknowledging 'we have to literally earn our business and client trust quarter after quarter' given lack of annuity contracts. Repeated questions about when headwinds will stabilize indicate analyst concern about visibility, while management's response that competitive intensity persists 'until AI situation stabilizes' suggests extended period of uncertainty ahead.