Artificial intelligence continues to play a larger role in enterprise technology spending, with Mphasis reporting that nearly two-thirds of its new business in the first quarter of FY27 was driven by AI-led engagements. The IT services company said 63% of its new deal wins during the June quarter were AI-led, reflecting growing enterprise demand for AI-powered transformation across industries.
Mphasis reported total contract value (TCV) wins of $461 million for the quarter ended June 30, 2026, supported by three large deals, including one contract valued at more than $100 million. The company said its trailing 12-month TCV has now crossed $1.8 billion, while its deal pipeline reached a record level, growing 8% sequentially and 28% year-on-year.
The company's financial performance also reflected steady growth. Consolidated revenue from operations rose 17.5% year-on-year to ₹4,384 crore, while net profit increased 10.8% to ₹489.5 crore. On a sequential basis, revenue grew 3.3%, although profit declined slightly due to acquisition-related costs. Operating margin stood at 14.8%, remaining within the company's guided range.
According to Mphasis, AI is increasingly becoming central to client transformation strategies rather than being treated as a standalone technology initiative. Enterprises are deploying AI across application modernization, software engineering, customer experience, automation and operations, creating larger and more integrated technology engagements.
The company said demand remained broad-based across sectors including banking and financial services, technology, telecommunications, insurance and retail. During the quarter, the Technology, Media and Telecom (TMT) vertical emerged as one of the strongest contributors to growth, while banking and financial services continued to generate healthy momentum through AI-driven modernization projects.
Management indicated that AI is also reshaping the company's sales pipeline. Enterprises are increasingly seeking partners capable of integrating generative AI and agentic AI into existing digital transformation programmes instead of pursuing isolated proof-of-concept deployments. This shift has contributed to higher-value engagements and larger multi-year contracts.
Mphasis has been investing in AI capabilities through its proprietary platforms and delivery frameworks. The company's AI Superhighway framework combines cloud, data, security, governance and AI orchestration to help clients deploy enterprise AI solutions while addressing model governance, explainability, observability and security requirements. Executives have previously stated that these investments have strengthened the company's ability to support clients throughout their AI adoption journeys.
Looking ahead, Mphasis maintained its FY27 outlook despite continued macroeconomic uncertainty. The company expects revenue growth in the high single-digit to low double-digit range and anticipates stronger sequential growth in the second quarter. Management also reaffirmed its operating margin guidance and expects operating cash flow conversion to remain strong.
The results come as AI continues to influence spending priorities across the global IT services industry. Clients are increasingly allocating technology budgets toward AI-enabled software engineering, business process transformation and intelligent automation, creating new growth opportunities for service providers with established AI capabilities.
For Mphasis, the latest quarter underscores how AI is becoming a key driver of enterprise deal activity rather than an experimental technology. As organizations expand AI adoption across core business functions, IT services firms are expected to see greater demand for end-to-end transformation programmes that combine cloud, data, automation and artificial intelligence into integrated digital strategies.