Dixon Technologies Q2: Revenue Rises 47%, Profit Falls 49%

Dixon Technologies ( DIXON ) delivered strong revenue growth in Q2 FY27, but profitability came under pressure. The contrast between its expanding business and declining reported earnings makes this an important quarter to examine beyond the headline revenue numbers. Key Q2 FY27 Highlights - Revenue from operations: ₹21,794 crore, up 46.7% YoY. - Consolidated net profit: ₹410.9 crore, down 44.9% YoY. - Profit attributable to shareholders: ₹343.7 crore, down 48.7% YoY. - EBITDA: ₹665.6 crore, down 37% YoY. - EBITDA margin: 2.7%, compared with 3.8% in Q2 FY26. - Mobile and other EMS division revenue: ₹20,093 crore, up from ₹13,361 crore. - H1 FY27 revenue: ₹37,938 crore, up 35% YoY. Why Are Margins Under Pressure? The sharp increase in revenue has not translated into proportional operating profit growth. Higher memory prices and the expiry of Mobile PLI 1 incentives have affected margins. Another important factor is the decline in other income, which fell to ₹68.7 Cr from ₹495.7 Cr in the year-ago quarter. This contributed significantly to the fall in reported net profit. Dixon is also looking towards new customer additions, Vivo JV operations and expansion in IT hardware and component manufacturing to drive its next growth phase. Vivo operations are now expected to begin in Q4 FY27. My View Dixon's Q2 performance presents a mixed picture. Revenue growth of nearly 47% demonstrates strong business expansion, but margin compression remains a concern. I would distinguish between the decline in reported profit due to lower other income and the underlying pressure on operating margins. Both deserve attention, but they have different implications for future earnings. Dixon remains strategically positioned to benefit from India's electronics manufacturing opportunity. However, investors should focus on earnings growth and margin sustainability rather than revenue growth alone. A strong business opportunity does not automatically make every valuation attractive.