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Firstsource Solutions (FSL) in Q1FY27 reported revenue of US$288 million

ICICIdirect Research 07 Aug 2026 DISCLAIMER

News: Firstsource Solutions (FSL) in Q1FY27 reported revenue of US$288 million, up 2.2% QoQ/12.3% YoY in constant currency (up 1.8% QoQ/11.2% YoY in reported USD terms). In rupee terms, revenue grew 5.5% QoQ/22.9% YoY to ₹2,724.9 crore. EBIT margin expanded to 12.4%, up ~20 bps QoQ/~110 bps YoY, marking the seventh consecutive quarter of margin expansion. Reported PAT stood at ₹165.9 crore, down 19.2% QoQ/2% YoY, impacted by ₹71.7 crore of exceptional items relating to  i) ₹35.7 crore provision for estimated non-recoverable dues following the termination of a healthcare BPaaS client contract, (ii) ₹28.4 crore indemnification for a regulatory penalty payable to a customer due to contractual non-fulfilment, and (iii) ₹7.6 crore fair value adjustment on contingent consideration related to an earlier acquisition. During the quarter, the company signed four large deals (ACV> $5 million; sixth consecutive quarter with four or more large deals), added 12 new logos including three strategic logos (potential of at least a $5 million revenue run-rate annually). Headcount increased by 670 QoQ to 36,875 employees.

View: FSL delivered another strong quarter with sustained double-digit growth and margin expansion. Management reaffirmed its FY27 guidance of 10–13% CC revenue growth and 12.25–12.75% EBIT margin, despite the wind-down of a healthcare BPaaS engagement that was expected to contribute 1–1.5% growth, citing add on work from the same client, its strongest deal pipeline in the last four quarters and healthy large-deal ramps. While execution of the exceptional item recoveries remains a key monitorable, sustained AI-led demand, expanding strategic partnerships and healthy deal momentum with wallet share gains in existing clients provide confidence on the medium-term growth outlook

Impact: Positive

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