After delivering better-than-expected Q3 earnings, Wipro's Chief Financial Officer, Aparna Iyer said that the company was seeing a strong momentum for small and medium-sized deals. "Quantum of small and medium sized deals improved significantly in Q3 quarter and thereby, our annual contract value (ACV) increased drastically after several quarters," Iyer said in the post-earnings call.
However, Iyer was in no rush to declare it an emerging trend and stated that she would rather wait for a few quarters to see if this comes out as a sustainable trend. Meanwhile, Wipro's deal bookings remained steady in the December quarter, despite the weak seasonality. The company reported total bookings of $3.5 billion, as large deal bookings grew 6 percent year-on-year to $961 million. Wipro secured 17 large deals during the quarter, worth a total contract value of $1 billion.
Looking ahead, the management highlighted that while 2024 was marked by macroeconomic challenges, discretionary spending seems to be slowly coming back, indicating a cautious optimism among its clients. " I see 2025 as cautiously optimistic," Srinivas Pallia, CEO, Wipro said.
In addition, CEO Pallia also revealed that the company was working with clients to understand where the spend is going, as many customers are in the process of budgeting. "January is when most clients start their budget cycle. Good amount of spend in Gen AI is a sense we are getting from early budget of clients," Pallia said.
Also Read | Wipro ADRs surge 4% after Q3 earnings beat, multi-year high margins
Pallia also noted that discretionary spending is on the rise in the Americas, while European customers are prioritising cost optimisation.
Wipro reported a 4.5 percent sequential rise in consolidated net profit to Rs 3,354 crore for the December quarter, while revenue rose marginally by 0.1 percent to Rs 22,319 crore. These numbers came well above estimates from a Moneycontrol poll of nine brokerages, which had projected a 5 percent decline in net profit to Rs 3,040 crore and a 0.6 percent drop in revenue to Rs 22,176 crore.
The company's operational efficiencies and cost-optimisation measures played a key role in improving its EBIT margin to 17.5 percent, the highest in three years. This also marked the fourth consecutive quarter of margin expansion, as highlighted by CFO Aparna Iyer.
Also Read | Wipro Q3 net profit rises 4.5% QoQ to Rs 3,354 crore, beats estimates; margin at 3-year high
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