Are Firstsour.Solu. latest results good or bad?

Firstsource Solutions has reported its financial results for Q2 FY26, showcasing a solid performance across various metrics. The company achieved net sales of ₹2,312.22 crores, reflecting a year-on-year growth of 20.09% and a sequential increase of 4.26% compared to the previous quarter. This marks the highest quarterly revenue in the company's history, indicating its ability to scale operations effectively.
Net profit for the quarter reached ₹179.52 crores, which represents a year-on-year increase of 29.88% and a sequential growth of 6.02%. The profit after tax (PAT) margin improved to 7.76%, up from 7.15% in the same quarter last year, demonstrating the company's capacity to convert revenue growth into profitability.

The operating profit margin also saw an expansion, reaching 16.25%, which is an improvement of 139 basis points year-on-year. This margin enhancement reflects operational efficiencies and better utilization of resources, despite the challenges posed by wage inflation in the business process outsourcing sector.

Overall, Firstsource Solutions has demonstrated consistent operational excellence, achieving double-digit year-on-year revenue growth for seven consecutive quarters. The company has also seen an adjustment in its evaluation, reflecting the stock's price appreciation relative to its fundamental improvements. The balance sheet remains robust, with a comfortable debt-to-EBITDA ratio and strong cash flow generation, further supporting its growth initiatives.

In summary, Firstsource Solutions' latest results highlight its strong market positioning and operational capabilities, underpinned by significant revenue and profit growth, alongside improved margins.