Salil Parekh, the CEO of India’s second-largest IT firm Infosys said the global macroeconomic environment is showing signs of stabilisation but still remains unsettled in parts, after the company raised revenue growth outlook for the current financial year (FY26).
“Discussions on the economy worldwide have come to a more stable situation, but it’s not fully settled,” Parekh said during the Q1FY26 earnings press conference. Infosys revised its constant currency (CC) revenue growth guidance for FY26 to 1-3 percent, up from the earlier 0-3 percent range.
The company reported a sequential revenue growth of 2.6 percent in CC terms for the quarter ended June, with large deal wins totalling $3.8 billion. The four-quarter high in deal wins was driven by traction in enterprise AI deployments and client consolidation, said Parekh.
Infosys highlighted that many clients remain focused on cost and operational efficiency, even those not directly impacted by macroeconomic uncertainties. “We’ve seen strong work with AI agents and benefit from consolidation. This gives us confidence to raise the lower end of guidance,” Salil Parekh said.
Infosys has deployed over 300 AI agents across business operations and internal IP, reporting productivity gains in the range of 5-15 percent across client programs. “These agents are helping clients make faster decisions, improve customer experience, and increase operational efficiency,” Parekh added.
Infosys' Q1 Performance
The IT bellwether reported an 8.7 percent on-year increase in consolidated net profit at Rs 6,921 crore for the quarter, beating street expectations. It also beat revenue expectations, which grew by 7.5 percent to Rs 42,279 crore.
A Bloomberg poll of brokerages had pegged Infosys’ net profit at Rs 6,778 crore and revenue at Rs 41,724 crore for the June quarter.
The company is seeing sectoral pressures in manufacturing, logistics, and consumer products, along with renewed demand in energy, utilities and telecom.
In terms of regions, Europe continued to outperform North America, with year-on-year CC revenue growth flat in the North American region, while Europe saw a 12.3 percent rise. Still, North America remains Infosys’ largest market with over 55 percent share.
The company maintained its operating margin guidance at 20-22 percent for FY26. The Q1 operating margin was 20.8 percent, with pricing improvements and seasonal tailwinds offsetting some investment-related pressure, Chief Financial Officer Jayesh Sanghrajka said.
Margins reflected a 100 bps impact from wage increases, partially offset by around 70 bps of benefit from improved pricing and seasonal efficiencies. Additional drag came from ongoing investments and third-party costs, Sanghrajka said.
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