STL, a leading optical and digital solutions company, has reported a resilient performance for the fiscal year 2025-26 (FY26), with its artificial intelligence (AI) data centre business emerging as a significant growth driver. The company's results reflect a strong operational performance despite a challenging global economic environment.
Key Financial Highlights
For the full fiscal year, STL's revenue from operations stood at INR 6,500 crore, representing a year-on-year growth of 8%. The company's EBITDA margin improved to 14.5%, up from 13.2% in the previous fiscal, driven by operational efficiencies and a favourable product mix. Net profit for the period rose by 12% to INR 420 crore.
AI Data Centre Business
The AI data centre segment emerged as a key growth engine, with revenues surging by 45% year-on-year to INR 1,200 crore. This segment now accounts for 18% of STL's total revenue, up from 13% in FY25. The company has secured multiple orders from hyperscale cloud providers and enterprises for AI-ready optical interconnect solutions.
Segment Performance
Optical Networking
The optical networking business, which remains STL's largest segment, recorded revenue of INR 3,800 crore, a growth of 5% over the previous year. The segment benefited from increased demand for high-speed connectivity solutions, particularly in 5G and fibre-to-the-home deployments. The company's order book for optical networking stood at INR 2,500 crore at the end of FY26.
Digital Solutions
The digital solutions segment, which includes software and services, reported revenue of INR 1,500 crore, up 10% year-on-year. The growth was driven by strong demand for network management and automation solutions. The segment's EBITDA margin improved by 150 basis points to 16%.
Strategic Initiatives
During FY26, STL made significant progress in its strategic initiatives. The company invested INR 400 crore in research and development, focusing on next-generation optical technologies and AI-driven network solutions. It also expanded its manufacturing capacity in India and Europe to meet growing global demand.
STL's CEO, Mr. Anil Agarwal, commented, "Our FY26 performance demonstrates the strength of our diversified portfolio and our ability to capitalise on emerging opportunities, particularly in AI data centres. We have strengthened our position as a trusted partner for global telecom operators and cloud providers."
Outlook
Looking ahead, STL expects the AI data centre business to continue its strong momentum, with projected revenue growth of 30-35% in FY27. The company also anticipates a recovery in the optical networking segment as global telecom spending picks up. STL plans to invest INR 600 crore in FY27 to expand its AI data centre solutions and enhance its R&D capabilities.
The company's board has recommended a final dividend of INR 2 per share for FY26, subject to shareholder approval.
