Fractal Analytics discusses its latest quarterly performance, the outlook for key business verticals, and its AI-first strategy. The company's leadership also shares why AI remains central to its business.
Watch the full interview for all the key insights.
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What Srikanth Velamakanni said
Written from the verified transcript and checked against it. Every figure links to the moment it was said.
Srikanth Velamakanni, cofounder and group CEO of Fractal Analytics, said the company's year-over-year revenue growth was 20% in rupee terms, with all margin metrics improving, despite a weak quarter-on-quarter performance due to seasonality. He noted that excluding TMT, growth was 35%, while TMT declined 22% year-over-year, but he expects TMT to bottom out and show sequential growth next quarter. He declined to provide guidance but stated he would be happy with growth exceeding 30% year-over-year, which he aims to achieve consistently by organizing the company into three vectors: AI-led transformation, AI foundations, and reimagining work and workforce with AI. He emphasized that Fractal is an AI-first company, blending classical, generative, and agentic AI, and cited the example of their data science agent, Pi evolve, now called Cogentic data science. He also said healthcare life sciences is now the second largest vertical and expects it to continue performing well.
Key takeaways
Fractal's year-over-year revenue growth was 20% in rupee terms, with all margins improving.
Excluding TMT, growth was 35%, while TMT declined 22% year-over-year.
Velamakanni expects TMT to bottom out and show sequential growth next quarter.
He aims for consistent year-over-year growth exceeding 30%.
Fractal is organized into three vectors: AI-led transformation, AI foundations, and reimagining work and workforce with AI.
0:18And for BFSI as well for the company, it's a slightly smaller vertical compared to the larger industry players, how does that growth go through there?
1:15Let's start by understanding the quarter on a quarter-on-quarter basis is a bit of a slide. Was this a tough quarter?
3:01Would the good performance of healthcare, which has in a sense mitigated some of those TMT losses, also be subject to that seasonality or you expect that to sustain?
3:31Healthcare, I'm asking about healthcare. Are you referring to healthcare?
4:09You say that TMT is going to get back into the right track in the second quarter, but will you be able to catch up with what you had anticipated for FY27?
5:58So if you're talking about agentic or you're talking about generative or you're talking about classical, what is the kind of breakup that you have and where are you most prevalent?
We're going to be speaking with Srikanth Velamakanni, the co-founder, group chief executive, and executive vice chairman of Fractal Analytics on what the company is doing going ahead. But, Srikanth, hold on. We're just getting Puneet, our colleague who tracks your sector to do a quick setup of what the numbers were like.
Well, thank you for that. As you rightly mentioned, the quarter-on-quarter performance was slightly weaker because revenue grew 3% while the EBIT was down in this particular quarter by almost 28% and margins hence are affected by almost 440 basis points. Now, while the biggest sector, the consumer packaging sector, has done well for the company in this quarter, healthcare has now taken in as the second biggest vertical, and that is a key positive. But there is some pressure seen on the TMT sector. Now, we have seen that within the industry, players like HCL Tech have also called out some pressure visible in that space. So that will be one of the questions as to what they are seeing right now in this particular vertical, will the growth be visibly back? And for BFSI as well for the company, it's a slightly smaller vertical compared to the larger industry players, how does that growth go through there? And if healthcare will continue to have this dominant growth, while of course a lot of questions on AI continue to be one in the company's journey on the same.
Okay. Let me go across to Srikanth. Srikanth, first of all, thank you so much for speaking with us. Always a pleasure to have you on with us on NDTV Profit. Let's start by understanding the quarter on a quarter-on-quarter basis is a bit of a slide. Was this a tough quarter?
See, overall, there are seasonalities in this business. Therefore, the best way to look at this business is year-over-year, and we have 20% growth in rupee terms year-over-year overall revenue, and our profits, every single gross margin or EBITDA margin or EBIT margin, every single margin number has trended in the right direction. So, Fractal overall profitability-wise doing really well vis-a-vis last year. One of the things that we were asked when we went when we are going public was that our margins going to be consistent. Can you deliver consistent margins? Yes, our gross margins have always been very consistent, high 40s, almost close to 50. But EBITDA margins were up and down a little bit, but now we have made sure that our profitability numbers look really good and they continue to improve every quarter. So that's the good news. Overall revenues at 20% is sort of okay, but we would like to have had that number at a much higher number. And if you look at our growth excluding TMT, it's 35%. So TMT is a negative 22% quarter vis-a-vis last year. So that's really what has pulled down the overall growth from 35 to 20 overall. And we expect that the TMT vertical will start to bottom out in terms of its degrowth and start to next quarter we'll see sequentially better quarter than this quarter. And so, therefore some of the problems that we're seeing right now will start to get resolved in the coming quarters.
I take your point, Srikanth, but you know, a lot of the same industry is looked at in a quarter-on-quarter basis. I understand your point that look at it year-on-year, there might be some seasonality. Would the good performance of healthcare, which has in a sense mitigated some of those TMT losses, also be subject to that seasonality or you expect that to sustain?
Velamakanni, S. (2026, July 24). Can Fractal Analytics Return To 30% Growth? Group CEO On AI-First Strategy & 30% Growth Ambition [Interview transcript]. NDTV Profit. CEOInterviews.AI. https://ceointerviews.ai/interview/1117180/
MLA
Srikanth Velamakanni. "Can Fractal Analytics Return To 30% Growth? Group CEO On AI-First Strategy & 30% Growth Ambition." NDTV Profit, 24 Jul. 2026. Transcript, CEOInterviews.AI, https://ceointerviews.ai/interview/1117180/.
BibTeX
@misc{velamakanni2026_1117180,
author = {Srikanth Velamakanni},
title = {Can Fractal Analytics Return To 30\% Growth? Group CEO On AI-First Strategy \& 30\% Growth Ambition},
howpublished = {Interview transcript, NDTV Profit. CEOInterviews.AI},
year = {2026},
month = {jul},
url = {https://ceointerviews.ai/interview/1117180/},
note = {Speaker-attributed transcript with timestamps}
}
