Infosys slashes FY26 revenue guidance; quarterly net profit falls substantially

FILE PHOTO: An workers walks previous a signage board within the Infosys campus on the Electronics Metropolis IT district in Bangalore, February 28, 2012. REUTERS/Vivek Prakash/File Photograph
| Photograph Credit score:
VIVEK PRAKASH

Bengaluru-headquartered IT providers big Infosys fell wanting market expectations by decreasing its FY26 revenue progress steering to 0–3 per cent in fixed forex (cc) phrases, down from the 4.5–5 per cent forecast for FY25 within the earlier quarter. The corporate posted a net profit of ₹7,033 crore for the March quarter, reflecting a 3.3 per cent sequential improve however an 11.7 per cent decline year-on-year from ₹7,969 crore in Q4FY24.

Through the quarter, revenue from operations stood at ₹40,925 crore, with a 2 per cent QoQ degrowth from final quarter’s ₹41,764 crore. Nevertheless, it grew by 7.9 per cent on an annual foundation. For the complete yr, Infosys recorded a revenue of $19.2 billion, up 3.9 per cent in reported phrases from FY24’s $18.56 billion. Full yr PAT stood at $3.15 billion , a decline of 0.3 per cent in reported phrases.

“On the backside of the steering, we assumed heightened affect from all of the micro-environment and factored in some growing uncertainty. On the prime finish, we’ve assumed a steady-to-marginally bettering atmosphere. It’s troublesome to separate out how a lot of that’s due to the US reciprocal tariffs or GCCs,” mentioned Infosys CFO Jayesh Sanghrajka.

Market share

Whereas the US stays Infosys’ largest market, accounting for over 57 per cent of its revenue, it recorded a year-on-year decline of 0.4 per cent in fixed forex phrases this quarter. In distinction, Europe and India delivered sturdy progress, rising 15 per cent and 43.7 per cent,. respectively in fixed forex.

Salil Parekh, CEO, and MD, mentioned, “We introduced an acquisition within the US in vitality and consulting, and stay, in a longer-term view, constructive on expertise modifications, and the markets we’re in whereas we may even see some uneven exercise within the quick or medium time period. However we’re additionally seeking to increase in different geographies, along with what we’re doing within the US. For instance, in Japan, Mitsubishi’s funding in our three way partnership, or the acquisition in Australia. Whereas we did properly in Europe this yr, the automotive sector continues seeing some slowness, which is a component of the present outlook.”

The corporate’s giant offers whole contract worth (TCV) stood at $2.6 billion, marginally greater than Q3’s $2.5 billion. Working margins stood at 21 per cent.

Headcount up a tad

Infosys’ whole headcount was recorded at 323,578, a small improve in comparison with 317,240. Initially of the monetary yr. Voluntary attrition in the course of the quarter rose to 14.1 per cent from 13.7 per cent in Q3.

Biswajit Maity, Sr Principal Analyst at Gartner, commented, “Infosys reported 4.2 per cent YoY progress in This autumn (CC), reflecting muted progress amid world financial challenges. Like its friends, the corporate confronted headwinds from decreased shopper spending and geopolitical uncertainties. Regardless of this, the outlook stays constructive. Over the previous yr, it has secured a number of giant, multi-year offers, demonstrating a strong observe document in core service supply and increasing into digital choices.”

He continued, that though over 60 per cent of revenue comes from North America — exposing it to regional dangers — a rising presence within the Nordics, Center East and South-East Asia helps diversify its market footprint.

“Whereas shoppers are typically glad with Infosys’ operational supply, some have highlighted areas for enchancment, notably in product roadmap planning, change administration, and steady enchancment. To maintain its progress momentum, Infosys should deal with these gaps and improve its responsiveness to evolving shopper expectations.”

On Thursday, the corporate’s shares had been up 0.51 per cent and closed at ₹1,420.20 per share on the BSE. Outcomes had been introduced after the markets closed.

(With inputs from businessline intern Nethra Sailesh)

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Printed on April 17, 2025