India’s second-largest IT services company, Infosys Ltd, reported a 7.3 percent year-on-year (YoY) fall in net profit at Rs 6,106 crore in the third quarter of FY24. This is below Moneycontrol’s poll estimates of Rs 6,244 crore.
On a sequential basis, the company’s bottomline declined by 1.7 percent, the Bengaluru-based company said in a regulatory filing on January 11.
Q3 is a typically weak quarter for IT companies as adverse impact from furloughs and fewer working days plays foul.
Infosys also narrowed its revenue growth guidance for the full year to 1.5-2 percent for the full year. This comes after it slashed the guidance last quarter to 1-2.5 percent from 1-3.5 percent.
Consolidated revenue for the quarter came in at Rs 38,821 crore, up 1.3 percent YoY. Revenues for the quarter were marginally above analyst estimates of Rs 38,630 crore.
In constant currency terms, topline declined by 1 percent YoY.
The EBIT margin or the operating margin was down 70 bps to 20.5 percent, which was affected by furloughs and salary hikes. The company retained its operating margin guidance of 20-22 percent.
“Our performance in Q3 was resilient. Large deal wins were strong at $3.2 billion, with 71% of this as net new, reflecting the relevance and strength of our portfolio of offerings ranging from generative AI, digital and cloud to cost, efficiency and automation," Salil Parekh, CEO and MD, was quoted as saying in a press release.
“Our clients are leveraging our Topaz generative AI capabilities and our Cobalt cloud capabilities to create long-term value for their businesses,” he added.
Outgoing Chief Financial Officer Nilanjan Roy said in a statement that “Q3 performance is a demonstration of our strong execution capabilities reflected in improved operational efficiencies achieved under ‘Project Maximus’, despite a challenging environment".
The IT major only reports the total contract value of its large deals, and reported a TCV of $3.2 billion, which is lower than last quarter’s record $7.7 billion.
Shares of the company ended up 0.4 percent to Rs 1,520.30 rupees.
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