Sonata Software Share Price Decline Over 3% After Q2 FY26 Standalone Results

Bengaluru, November 14, 2025: Sonata Software Ltd’s share price fell sharply in early trade on Friday, dropping over 3% to ₹374.70 by 12:30 IST. The decline followed the company’s standalone financial results for Q2 FY26, which showed revenue growth but a year-on-year dip in profitability. Investors responded cautiously to the mixed performance, weighing the revenue gains against the profit contraction.

Sonata Software, a global IT service and consulting company based in Bengaluru established as a Public Limited Company in 1999. It specializes in delivering digital transformation cloud solutions, platform engineering, and software development services across multiple geographies and industry verticals. The company continues to invest in its service offering and to enhance its technology capabilities, responding to short-term fluctuations in the market.

Increased Revenue but Lower Profitability

The company reported a quarter-on-quarter increase in revenue from ₹27,857 lakh in Q1 FY26 to ₹30,640 lakh in Q2 FY26. This was a healthy growth driven by stable operational activity. Total income for the quarter rose significantly to ₹44,866 lakh, aided by a large increase in the other income line. However, on a year-on-year basis, profit for the period dropped to ₹14,677 lakh in Q2 FY26 from ₹16,454 lakh in Q2 FY25. The decline signals margin pressure despite the higher topline.

Increasing Costs Affect Performance

A major contributor to lower profitability was the rise in total expenditure, which was ₹28,823 lakh in Q2 FY26, up from ₹23,341 lakh a year earlier. Higher employee benefit expenses and overall service costs put pressure on earnings, resulting in a lower profit before tax compared to the previous year. Although the company reported a sizable profit improvement from Q1 FY26 to Q2 FY26, the year-on-year decline outweighed the quarter-on-quarter improvement in investor sentiment.

REF: https://nsearchives.nseindia.com/corporate/SONATSOFTW_13112025173406_outcomeofbm13112025.pdf

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