Archive · 6 Jan 2026
Mid-cap IT firms see modest Q3 growth
Mid-sized Indian IT companies are expected to grow a little in the December 2025 quarter.
This growth is mostly because companies are working on deals they already signed, especially ones about saving money and using fewer vendors.
Not many new big deals are being made, but the ones they have are helping.
Some companies, like Persistent Systems, are doing better than others.
Artificial intelligence is also helping these companies compete and make bigger deals, but it's not making them grow much faster right now.
The companies' profits might not be very high this quarter because of things like wage increases and seasonal breaks, but some help from currency changes and being more efficient might balance that out a bit.
Mid-cap IT firms expect 0.5–4% sequential revenue growth in Q3 2025, driven by vendor consolidation and cost-optimisation.
Demand remains stable, but discretionary spending is tight across client segments.
Persistent Systems leads with 2-4% QoQ growth, supported by large deal ramp-ups and strong renewal activity.
AI solutions are expanding the total addressable market and improving competitive positioning for mid-cap firms.
Margins are expected to be uneven, with EBIT margins ranging from low-teens to mid-teens.
- Who
- Mid-cap Indian IT services companies
- What
- Expected sequential revenue growth in Q3 2025
- When
- December 2025 quarter
- Where
- India
- Why
- Stabilising demand and vendor consolidation
Optimistic View
Cautious View
Revenue Growth
Optimistic View
Revenue growth is stabilizing after several quarters of deceleration, indicating a potential rebound.
Cautious View
Revenue growth is lower than expected and may face further pressure, leading to potential earnings downgrades.
- Expected Revenue Growth
- 0.5–4% QoQ in constant currency
- Key Growth Drivers
- Vendor consolidation and cost-optimisation programs
- Margins Range
- Low-teens to mid-teens EBIT margins
- Leading Company
- Persistent Systems (2-4% QoQ growth)
- AI Impact
- Expanding TAM and improving competitive positioning
Sources
Vendor consolidation and cost optimisation to drive mid-cap IT growth in Q3
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