Infosys, the Indian IT services firm, on Thursday clocked an 11 per cent rise in consolidated net profit in June quarter at Rs 5,945 crore, but lowered full year growth outlook to 1-3.5 per cent amid macro uncertainties. The net profit (before minority interest) during the same period previous year stood at Rs 5,362 crore. Infosys' posted a revenue growth of 10 per cent to Rs 37,933 crore, up from Rs 34,470 crore in the year ago period. The operating margin for the quarter was stable at 20.8 per cent. Its attrition declined to 17.3 per cent during the quarter.
The country's second-largest IT services company has lowered its revenue guidance for the full year to 1 to 3.5 per cent in constant currency, down from 4 to 7 per cent projected earlier. While the IT firm cut its FY24 revenue guidance to 1.0-3.5 per cent, it maintained operating margin guidance at 20-22 per cent. Operating margins declined by 20bps and came in at 20.8 per cent.
In a statement, Salil Parekh, CEO and MD, of Infosys, said, "We had a solid Q1 with a growth of 4.2 per cent and large deals of $2.3 billion which helps us to set a strong foundation for future growth. Our generative AI capabilities are expanding well, with 80 active client projects. Topaz, our comprehensive AI offering, is resonating well with clients. We see this being transformative for clients and enhancing our overall service portfolio."
Infosys, which only reports the total contract value (TCV) of its large deals, reported a TCV of $2.3 billion, which is up from last quarter’s $2.1 billion. This comes at a time when the company has announced two major deal wins — a MoU with BP for a $1.5 billion deal, and another with Danske Bank of $454 million. The IT major also announced this week that it has entered into an agreement with an existing client to provide AI and automation-led development, modernisation and maintenance services, where the spend would be $2 billion over five years.
The CEO said in the press conference that the company is seeing clients either stopping or slowing down transformation programmes and discretionary programmes, particular in financial services, mortgages, hi-tech, telecom, and retail. Parekh said that deal signings and start dates have been delayed, and a lot of the revenue from the larger and mega deals will be seen only towards the later part of the financial year. A combination of both is why, Parekh said, the company slashed its revenue guidance for the year.