Zensar Q2 revenue rises 2%; AI-led deals account for 36% of order book

BENGALURU: Mid-sized IT services firm Zensar Technologies reported a 2% year-on-year increase in revenue in constant currency terms, while sequential growth stood at 4.1%. in the September quarter. Its EBIT margin stood at 13.4%, down 30 basis points year-on-year.Banking and financial services was a key growth driver, with revenue in the vertical rising 17.1% year-on-year and 7.1% sequentially in constant currency terms. The US business grew 2.5% year-on-year, while Africa expanded 2.2%. Healthcare and life sciences declined 9.9%, and telecom, media and technology contracted 21.6% year-on-year in constant currency terms.AI-influenced deals accounted for 36% of the company’s order book in the quarter. CEO and managing director Manish Tandon said the company was seeing broad-based growth across verticals, except telecom. He said companies continuing to sell traditional services in traditional ways would find the market diminishing, while those taking newer offerings and concept-led solutions to customers would find opportunities.Tandon said around $30 million of deals were awaiting paperwork before being added to the order book, and he was not particularly concerned about the delay.On client expectations of productivity gains, he said IT services companies would increasingly have to move from time-and-materials contracts to outcome- and output-based models.He also believes AI is changing the industry’s talent requirements. “Writing code has become a commodity,” Tandon said, adding that companies would need engineers with deeper software engineering skills who could instruct AI tools to generate code, rather than those who merely write code quickly.Zensar’s headcount increased to 12,320, with 978 net additions during the quarter.You use AI every day. Now get your AI Quotient. Take the AIQ test.