Earnings guidance from Indian IT outsourcing firms such as Tata Consultancy Services Ltd. and HCL Technologies Ltd. will provide insight into the expected recovery. Despite US and European companies being hesitant to spend on new projects, TCS and HCL have concentrated on outsourcing projects that offer cost savings. Consensus estimates suggest that TCS’s results next week will show sequential revenue growth for the April-June quarter.
Accenture Plc, a US-listed peer, has indicated that the rise of generative artificial intelligence is encouraging businesses to rethink and invest in their IT systems. This development is likely to create revenue opportunities for firms like TCS and HCL.**
In Japan, Fast Retailing Co., the owner of Uniqlo, and Ryohin Keikaku Co., the owner of the Muji brand, are both anticipated to see double-digit operating profit growth for the quarter. Bloomberg Intelligence attributes this to warmer weather boosting sales of spring-summer clothing.
 LG Energy Solution’s (373220 KS) second-quarter earnings might fall short due to lower demand for electric vehicles in Europe, according to HI Investment & Securities. Demand from Tesla, a customer for its cylindrical batteries, also decreased due to price competition from Chinese EV makers. The company is quickly working to commercialize battery technology to compete with Chinese rivals.
Tata Consultancy Services’ (TCS IN) quarterly profit is expected to grow by 8.3% as the earnings recovery in the Indian IT sector takes shape. Analysts at Prabhudas Lilladher noted that salary hikes would impact margins compared to the previous quarter, although the rate of wage increases has slowed. TCS likely added over 10,000 employees from the previous quarter, marking the first sequential headcount growth in a year. Watch for commentary on financial sector clients, who account for nearly a third of revenue and have significantly contributed to the recent slowdown.
Fast Retailing’s (9983 JP) third-quarter operating income likely rose by 12%, according to estimates. SMBC Nikko suggested that sales in East and Southeast Asia should improve if economic sentiment picks up. The operating margin in China will be closely watched due to weak consumer sentiment, the brokerage added. The retailer is also investing in new technologies, including barcode-less checkouts, to achieve its target of 10 trillion yen ($62 billion) in annual sales.
Seven & i’s (3382 JP) first-quarter operating profit likely declined by 7.7%, according to consensus estimates. Domestic and overseas sales were weak in March and April. However, the overseas business may meet its fiscal 2025 operating profit growth target of 4%, aided by improved gas volumes from 204 new stores and slight growth in gross margin, SMBC Nikko reported.
HCL Technologies’ (HCLT IN) first-quarter earnings are expected to be bolstered by strong revenue growth in the IT & business and engineering & R&D services units, according to consensus estimates. The company is anticipated to reiterate its 2025 revenue growth guidance of 3%-5% at constant currencies, per Nomura. However, Jefferies noted that a near-term growth recovery is unlikely due to subdued discretionary IT spending.
Ryohin Keikaku (7453 JP) should report quarterly operating profit growth as higher temperatures boosted sales of its spring-summer clothing. Despite struggles, the China business is outperforming the general apparel market in China, Jefferies analysts noted in a June 10 report. The owner of Muji may add more affordable items to its lineup to compete with local rivals like Miniso and meet full-year earnings targets, Bloomberg Intelligence suggested.
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