NIIT

NIIT Limited reported a robust Q2 FY26, with revenue reaching INR 1,049 million, marking a significant 16% year-on-year and 25% quarter-on-quarter growth. This performance was at the upper end of the company's guidance. Order intake also demonstrated strong momentum, increasing 14% YoY and 37% QoQ to INR 1,454 million, indicating healthy demand for its offerings.

Despite a volatile operating environment, NIIT continued its planned strategic investments in AI, platforms, products, and brand building. These investments contributed to a positive EBITDA of INR 13 million for the quarter, a notable improvement from a negative INR 63 million in the previous quarter. However, the company anticipates Q3 FY26 margins to remain in the low single digits due to the ongoing investment phase.

iamneo, an AI-powered deep-skilling SaaS platform, successfully contributed INR 111 million to the Q2 revenue in its first full quarter of consolidation. Management highlighted iamneo's strong order intake and contract expansions, expecting it to catalyze growth, open Higher-Ed channels, and enhance NIIT's AI-first deep-skilling capabilities, including coding labs, assessments, and placement automation.

The company's business mix for the quarter was 67% enterprise and 33% consumer. Enterprise revenue grew 10% YoY and 22% QoQ to INR 703 million, while consumer revenue saw a 29% YoY and 30% QoQ increase to INR 347 million. Technology programs revenue was particularly strong, up 31% YoY and 30% QoQ to INR 761 million, though BFSI and other revenues declined 12% to INR 288 million due to ongoing sector-specific headwinds.

NIIT has initiated a scheme of amalgamation to merge RPS Consulting and IFBI into NIIT Limited, a process projected to conclude within 8 to 12 months. This strategic restructuring aims to simplify the organizational structure, enhance agility, and create a more robust entity by consolidating operations. Management expects this to lead to cost savings and better address customer needs.

Management noted sustained consumption in the tech segment and strong demand from Indian enterprises. While the BFSI segment continues to show hesitation, NIIT is actively exploring new growth opportunities in the EV space and cybersecurity, strengthening its capabilities in these areas. The company expects overall momentum to continue into Q3 and anticipates stronger performance in H2 FY26, with full-year FY26 revenue growth guided at 15-20% YoY.

Capital expenditure for the quarter was INR 69 million, consistent with the company's investment cycle. Cash and cash equivalents stood at INR 6,846 million, a decrease from INR 7,115 million last quarter, primarily due to a dividend payment of INR 136 million and an investment of INR 101 million in iamneo. Net other income was INR 82 million, impacted by a non-cash mark-to-market loss on fixed income investments, which is expected to reverse over time^⏳.