NIIT Limited — Q1 FY27 earnings call

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Date: 2026.07.27 12:51:55+05'30'

2026.1.1 ARPITA BISARIA MALHOTRA Page 1 of 12 “NIIT Limited Q1 FY27 Earnings Conference Call” July 21, 2026 MANAGEMENT: MR. VIJAY THADANI – VICE CHAIRMAN AND MANAGING DIRECTOR – NIIT LIMITED MR. PANKAJ JATHAR – CHIEF EXECUTIVE OFFICER – NIIT LIMITED MR. SANJEEV BANSAL – CHIEF FINANCIAL OFFICER – NIIT LIMITED NIIT Limited July 21, 2026 Page 2 of 12

Ladies and gentlemen, good day and welcome to the NIIT Limited Q1 FY27 Earnings Conference Call. As a reminder, all participant lines will be in the listen-only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during this conference call, please signal an operator by pressing star then zero on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Vijay Thadani, Vice Chairman and Managing Director of NIIT Limited. Thank you, and over to you, sir.

Thank you. Good afternoon, actually good evening and welcome to NIIT Limited's Quarter 1 FY27 Earnings Call. As usual, we thank you for your interest in NIIT Limited as well as the time that you're spending today with us amongst -- in the middle of a busy results season and for joining the call and giving us your support and suggestions. Today's agenda is to discuss with you the quarter 1 FY27 performance highlights. Second, what is shaping FY27 and the actions that we are taking, our priorities and outlook. I'm happy to share that -- share with you as a start that we are starting off FY27 on a strong note, definitely stronger than same period last year. And I think it is increasingly becoming stronger as we go forward with both enterprise as well as consumer go-to-market engines showing growth in quarter 1. While technology continued to grow well from AI-led investments in skilling, we also have growth from banking, financial services and others. Order intake continued to remain strong, indicating our investments in the new AI programs as well as our go-to-market initiatives. On the profitability front, our EBITDA is moving in the right direction with our operating costs growing slower than our revenue. Just to remind that certain parts of the business have been in an investment cycle. And in quarter 1, those investments are normally higher than other quarters. With that, I'll hand you over to Pankaj Jathar, our CEO, to take you through the quarter 1 performance in detail, and then we'll open it up for question and answers. Pankaj?

Thanks, Pankaj. So I'll take you through the financial results. EBITDA for Q1 was negative at INR14 million. This is a significant improvement from the negative INR63 million in Q1 of last year. This is driven by improved productivity and operating leverage while we continue to invest in GTM capacity and new AI offerings. As Vijay mentioned in his opening remarks, while our new top line grew by 14%, our operating expenses grew 7%, putting us back on the path to positive EBITDA margin. Below EBITDA, depreciation was at INR96 million in Q1. Net other income was INR180 million. This is primarily comprising of treasury income of INR175 million and other miscellaneous income of INR24 million. That is offset by net finance cost of INR3 million, and there are some Exceptional expenses of INR15 million, primarily because of the legacy tax matter that has now been concluded in NIIT server. And some part of the cost is pertaining to the scheme of arrangement for amalgamation of RPS and IFBI into NIIT Limited. This resulted in a PAT of INR81 million for the quarter, which is up 85% Y-o-Y and EPS of INR0.60, that is up 84% on Y-o-Y basis. Now coming to balance sheet and cash flows. Cash and cash equivalents remained strong at INR7,231 million, underpinning our ability to invest through the cycle. Capex was INR66 million for the quarter. We are past the peak on capital investment in platform in the current investment cycle, and we expect capital expenditure to moderate from there. DSO was at 53 days in Q1, which is same as last quarter. Employee count at the end of Q1 was 866, which is down 65 on a Q-o-Q basis and 19 number of people on Y-o-Y basis. Now back to Pankaj.

Thank you, Pankaj. Just summarizing, we started FY27 with a robust growth, a strong order book, broader customer base and a clear sense of what and where are we winning. We are responding to the areas of pressure by widening the demand base, accelerating the parts of the portfolio that are working, especially technology and AI and maintaining cost discipline while continuing targeted investments. Our investment cycle continues. However, our focus has more become on AI programs and usage of AI in every program that we surveyed our customers with. What gives us confidence is that the portfolio is becoming more resilient, strengthening of our product portfolio for working professionals, rollout of new AI programs, go-to-market expansion and the iamneo initiative are all showing early results. NIIT Limited July 21, 2026 Page 6 of 12 We remain confident of the longer-term structural growth opportunity and are committed to making the investments needed to capture that opportunity. So in order to -- in addition to investing in new programs and stronger go-to-market initiatives, we continue to follow a disciplined approach to evaluating inorganic opportunities that enhance capabilities, channels and/or intellectual property and which offer a clear path to returns and cash return. So I want to pause here and open this line for questions and then we can take the discussion forward.

Thank you very much. We will now begin with the question and answer session. We have the first question from the line of Harsh Yadav from Dolat Capital Market Private Limited.

A very good evening to you. Am I audible?

Sorry to interrupt Harsh, you are not audible. Please use your handset for the speak.

A very good evening to you. Am I audible now?

Yes. Very audible.

You are audible.

So my first question is basically, in the presentation, you highlighted that AI-led programs now contribute about 9% of overall revenue. Given that enterprise clients are compressing the traditional team sizes, how are pricing realizations and ARPU trending for AI-led capability building compared to legacy IT training?

Yes, there are a few more questions I have.

Why don't you answer one?

Okay. My next question is, so consumer posted a robust growth of 27% year-over-year, even though your total enrolment saw a quarter-over-quarter dip by around 150,000. Could you provide some color on the split between early career and WorkPros learners this quarter?

So we used to track early career WorkPro, but those lines have become so fuzzy that -- but when we are talking of consumer, consumers also have WorkPro's built into them. So we are not at this point of time, breaking that. Sufficient to say that the early career part, if we were to take iamneo's offerings, for example, they service a large number of universities and those are all in the early career part of the business. And I think that part has done well. And overall, the mix in NIIT Limited July 21, 2026 Page 7 of 12 early career is increasing, but not at the level at which we would have expected given that the hiring is very, very muted.

So just a follow-up on that. As we have seen that top 5 IT services firms continue to curtail their fresher hiring. So within consumer, has growth primarily been driven by experienced working professionals that are upskilling in AI? And also, I just wanted to know how StackRoute and TPaaS are performing in this environment?

Sorry, I heard the first part, which I'll answer. The second part, I'll ask you to repeat, if you don't mind.

Okay.

So there is -- now let me further subdivide early career into 2 parts. One is fresher and the other is 2 to 4 years’ experience. So early careers actually includes the 2 to 3 years’ experience or not 4, 2 to 3, 2-0 to 3, yes, 2 to 3 years' experience. I think that segment because people are reskilling themselves like our Agentic AI programs. For example, the pull for those is higher because the current people who have been hired or are working in organizations need to reskill themselves very quickly, a, to retain their jobs; and b, to find growth opportunities. So I think that's where the real push is. The pressure is largely driven by the onboarding requirement of corporates, which has not started yet. But there are -- when we look at IT hiring, we look at the top 10 or top 20 IT services companies, but there are a large number of start-ups and other companies which are also in the hiring game and GCCs, where the numbers are not individually at very large level, but there are a very large number of companies. So I think there is a momentum which is building up there.

Okay. All right. My second part of this question was actually, I just wanted to know how StackRoute and TPaaS are performing in this environment?

Okay. I think maybe Pankaj would like to talk about -- all those terminologies have now got changed after we merged RPS and IFBI into NIIT. So he is now giving you numbers. Numbers are still the same, but I think the businesses have got combined, simplified and I think that's also reflective in how we have managed our costs. But maybe, Pankaj, you will talk about this.

They are both housed under NIIT, and therefore, you don't have those available separately.

Okay. I just have a very qualitative question. Just wanted to shoot it. So I've been noticing with the advent -- so there's an advent of a lot of IIT and IIM offerings with respect to online certifications, degree programs, especially in this AI Agentic applications, FDE, etcetera. So how do we position ourselves in this environment? And what are we doing to create like an edge in terms of program structure or like an implementation point of view with this upcoming courses and programs from so many different educational institutions within the country and also outside, especially targeted to working professionals?

No, let me add one line. I think we at least believe that in this -- in the new world that we are in, it is the capability which counts rather than the credential. So we are not running after credentials. We are running after building capability. And I think that success is very visible in our enterprise offerings. Our enterprise offerings are showing a clear differentiation because we are able to demonstrate outcomes in terms of capability, which leads to productivity and effectiveness of the workforce. So people are preferring that rather than allowing a credential program -- rather than adopting a credential-based program. NIIT Limited July 21, 2026 Page 9 of 12 On the consumer side, that awareness is not yet there. But wherever we have access, we would like to focus on that part because I think the long term lies not in credentialing, but in capability which can be demonstrated. And employers will now hire for capability and not the credential.

We will take the next question from the line of Aman Prakash, an Individual Investor.

And my question is to Pankaj. You mentioned about outcome-based learning, right? So I want to understand more about this because you're right that -- I mean, if you use AI, it is in the end, the outcome that counts, right? And if you take this into account, then the umbrella of opportunity is far bigger. It is not just IT companies, right? Eventually, it might percolate down to like other sectors as well. So I want to know more about like how you are going about this outcome-based learning right now and what are like the plans for the future?

Yes. I guess outcome depends, as Pankaj rightly pointed out. Outcome depends on what is the outcome that you came for. If you came for -- we are firm believers of the fact getting a job is not the problem. Getting the job is the real challenge. When people join a course, they are not joining it for a job, a job you can get. But the job, job which is consistent with the investment that you made in that course. And that you will get only if you demonstrate that capability in terms of being able to do and create a live application. And I think there are enough and more ways by which employers test you for whether you have that capability, Hackathon being one of them. Hackathon is very -- becoming a very, very standard way by which people hire, especially tech professionals. So if you are able to build and solve that problem that is given in the Hackathon, then you have a reason. So I'm giving you that as an example. An Agentic AI, for example, program, a person who is doing, he may have an agent that he -- or a bunch of agents that he has to create to solve a workflow problem in his organization. NIIT Limited July 21, 2026 Page 10 of 12 In which case, was he able to do that? In this program, by the end of the program, you could actually have an early part or an early version of that agent ready for deployment. So I think that is not something which any credential-based program typically offers.

Okay. All right. Just one last question regarding this outcome-based, right? One is the outcome at the personal or the individual level, right? But we see in India a lot of like these legacy companies, right, which eventually will have to like -- or will move towards AI. So then there is because a big part of our business, I think if I'm not wrong, more than 60% is now B2B enterprise level. So is there like a thing, let's say, an organization approaches NIIT and then the outcome- based AI, like how do you say learning or the transformation can happen, anything of that sort like going on or is it in the pipeline?

Yes. So I was -- I gave you some examples of an early career person. But in organizations who are deploying, for example, GSIs or GCCs, they have specific initiatives happening where their people have to be billable. How long are the people billable after they join that organization is an outcome that is very important to them. We would like them to be billable in day 1, R1. And if we are able to deliver that, then organization would prefer that. So I think that's also an example. How do their realizations improve? How do their deliverables improve? So although actually in an enterprise program, in a running enterprise, when you introduce AI, outcomes are more easily definable.

Thank you. We have the next question from the line of Ganesh Shetty, an Individual Investor.

My question is regarding integration of StackRoute, NIIT Enterprise business and also RPS Consulting. So after this integration of these businesses, whether we have fine-tuned our go-to- market strategy and whether this will also result in easier processes for the company and market improvement. Can you please throw some light on this, sir?

Yes. NIIT Limited July 21, 2026 Page 11 of 12

Net-net, I think what Pankaj just trying to say is that the combination has got integrated in the last few months, right? Even though officially, it has happened from 1st of July, but it has been in the works before that. And I think the combination has got going, as you can see from the enterprise tech results also. And I think we'll see more efficiency and better performance as we go forward. Obviously, the tailwind of the environment is also helping.

Yes. Sir, my second question is like continuation of earlier response. We are now serving mostly BFSI and technology sector. And as AI is now entering all the sectors and is a part of natural progress. So are we targeting any other sectors for giving them AI-related training or we are preparing ourselves to market ourselves as an AI leader in training to access other sectors, auto or anything like that industrial where we can showcase our AI capabilities and make them AI- based -- or AI competent. Can you throw some light on this, sir?

Okay. Sir, my third question is regarding the opportunity in university sector. As we -- there are hundreds of universities, deemed universities in India, but they are lacking I think, AI compatibility. And we are having iamneo as a special division where we are -- we can easily collaborate with institutions or universities apart from placement services for giving them content for AI training for in-house capabilities. So are we trying for these type of businesses right now? Is there anything like that in our pipeline, sir?

No, I think, yes, you are absolutely right. The universities are very hungry to add AI in their curriculum. However, I think different universities have different level of commitment for that. The solution that we are offering from iamneo is a very, very superior solution and would be suitable only for maybe top 500 or so. And then we are looking at solutions which the other universities would like to have. So for example, engineering colleges, the level of AI solutions that they need are very different or curriculum that they need is very different from what, let's say, commerce or a liberal arts university would look at or a science university would look at. So I think defining a curriculum NIIT Limited July 21, 2026 Page 12 of 12 which is for each segment is the next issue. AI is not a magic wand by itself. AI has to be used in specific situation in a specific manner for best results. And that's what I think our focus is.

Sir, can I ask one more question if time permits.

Sure. Yes..

The macro has been very challenging for entire year, coming back to our own business, whether we can see that whether the macros have improved from the last quarter or it has deteriorated this quarter or whether we are in the same mode and there is no improvement in macros and the business is as -- that's all from me.

Well, I think you understand macros better than we do. And we all get swayed by the macros by statements of one leader or the other and by some actions. I think the situation, in fact, I would tend to feel the situation remains the same. There are days when it looks about to be very, very brighten up a lot, but there are days when it just goes back to -- and nowadays, the current days that we are going through are not pointing in the right direction. So I think we have to look at the opportunities ahead of us rather than we get concerned by the macros a lot. Of course, we have to be conscious of that. So for us, the AI opportunity and the role that AI has to play in education, AI has to play in the fundamental business of some of the organizations is an opportunity which will exist irrespective of the macros. So we are focused on that. And I think that is delivering us results. There are parts of the business which are very dependent on how environment works. We will remain open to that. But how do we just spread our risk that we do not get caught in any one particular direction is, I think, the challenge that we are all working on. We are also opening doors for newer segments that we have not serviced. And we are also looking at inorganic growth, which I mentioned already.

Thank you very much. Ladies and gentlemen, that was the last question. And with that concludes the question-and-answer session. I now hand the conference back to the management for the closing comments. Thank you, and over to you, sir.

Okay. Thank you very much for joining us this afternoon or this evening for this session. This is the first time we have switched to the timing of the call to be such. We would love to receive your feedback on how you found it in terms of convenience. And, of course, on content, your questions always educate us and open new windows or doors in our mind of the opportunities ahead of us. And we remain grateful to you for giving us your time, for your support and for your guidance from time to time. Thank you very much, and wishing you the best.

Thank you, members of the management. On behalf of NIIT Limited, we conclude this conference. Thank you, everyone, for joining with us today, and you may now disconnect your lines. Thank you.