LTM reported revenue of ₹11,608 crore in Q1 FY27, up 2.8 per cent sequentially and 18 per cent year-on-year, while net profit rose to ₹1,469 crore, increasing 9.5 per cent quarter-on-quarter and 17.1 per cent from a year earlier. The company also reported a 120 bps year-on-year and 40 bps sequential expansion in EBIT margin.Venu Lambu, CEO and MD of LTM, discusses the company’s Q1 performance, margin expansion, AI-driven client spending, deal pipeline, hiring outlook and growth expectations. Edited Excerpts:Could you highlight the key announcements from the quarterly results?We delivered 6.4 per cent year-on-year (y-o-y) growth on a constant currency (cc) basis, an improvement over last year’s full-year growth; we are on a good trajectory. We also expanded our margin to 15.5 per cent with a steady order book. Our top clients grew by 4.5 per cent, and the top 10 by 4.3 per cent sequentially.Two of our biggest industry segments, financial services and tech services, are past the productivity phase. They’ve delivered 3.2 per cent and 3.4 per cent respectively, sequentially. Consumer has delivered 18 per cent y-o-y growth. It’s been a good quarter.There was some softness in India and West Asia . India was affected by delayed access to certain computing infrastructure due to the conflict, the memory shipment issue, and the delayed ramp-ups.Our margins have expanded. The order book has been steady. And we declared AI revenue of $150 million quarterly. We also defined the types of AI work classified as AI revenue.Today, we also announced a partnership with Anthropic. It positions us to help our customers bring the frontier model capabilities of Anthropic and our domain and contextual capabilities to accelerate deployment. So, we are entering FY27 with positive momentum.Margins expanded despite a challenging environment, but revenue was slightly below expectations. What drove the margin gains, and what weighed on revenue?We started the Fit for Future program last year to redefine our overheads and cost of delivery. It delivered margin expansion last year. Even this year, we want to continue that momentum of challenging the status quo, especially on the cost of delivery, which has fundamentally changed.To achieve the new cost of delivery, we came out with a program called New Horizon so our delivery and market leadership can address the new horizons to conquer, both in cost and growth narrative. That requires us to have a different lens for pyramids, utilisation, and the pricing aspect, because of the opportunity for better margins and growth. We will expand this as we enter Q2 as well.It was a satisfying quarter, but the softness was predominantly in the India delayed ramp-up, one-off seasonal revenue in our production segment, and the West Asia conflict. Those factors were beyond our control. On the aspects we could influence, we delivered a strong quarter.How has client spending across the US and Europe evolved amid ongoing geopolitical uncertainty?The spend has a new treatment approach from clients looking at prioritising AI-related spend, whether to modernize the systems to build agent AI services for their businesses, or working with us to create AI-friendly and AI-agentic services.The second area that clients are spending on is accelerating product development for their business using AI-led software engineering. AI has given clients a fantastic opportunity to increase the throughput velocity and deliver products to their business at a faster pace. Hence, AI-led software engineering is another area that we see spending.As clients are waiting for the macroeconomic situation to improve in parts of the world, they are prioritising this category of spend. How is your deal pipeline shaping up, particularly for large deals? Is it stronger than last year?Last year was great because we announced 10 large deals. We would be happy to match this. From a market standpoint, I don’t see any change. Opportunities to consolidate vendors and drive cost savings continue to exist. We tend to win more of these in the marketplace. We announced one large deal in Q1, related to the vendor consolidation exercise with a large US customer. We are also seeing engagements in AI work, including AI-native services, business AI, creative AI, and industrial AI.What’s the hiring outlook for FY27?We hired about 1,100 people this quarter, and expect the same momentum to continue, if not more, for the remaining quarters. As for lateral hires, there is demand for AI skills. There is no specific number. If we can get 500 AI-deployed engineers, we will hire them. However, availability has to match the demand.