NEW DELHI: IT services company Infosys missed Street estimates, and posted a 7.3% drop in third quarter (Q3) net profit at Rs 6,106 crore compared to Rs 6,586 crore in the same quarter last year.
The IT major has again revised its FY24 revenue guidance to 1.5-2% against 1-2.5% it had projected during the September quarter. This is the third revision in guidance. It maintained its operating margin guidance for FY24 at 20-22%. Infosys’ revenues for the third quarter stood at `38,821 crore, growth of 1.3% YoY. Its operating margin for the December quarter stood at 20.5%, decline of 1% YoY. The IT company’s large deal for the quarter stood at $3.2 billion.
Salil Parekh, CEO and MD, said with Gen AI, the company has an extremely strong capability to set up a lot of activity with its clients. The CEO said the company is working with a large retail company on their first AI transformation and that they have tremendous capability and a good market position.
“Our clients are leveraging our Topaz generative AI capabilities and our Cobalt cloud capabilities to create
long-term value for their businesses”, he added. At the press conference, the CEO spoke about large deal wins. “If you look at the nine months, this is the highest ever value of deal wins that we have.
Actually, it is more than what we had in the year before and that 71% of this is net new.”The company is also not seeing any immediate campus requirement. The outgoing CFO Nilanjan Roy said that they have a very strong off-campus programme. Roy added that they continue to monitor the utilisation and Flexi hiring models.
The company’s attrition declined further to 12.9% and its headcount in the quarter reduced by 6,101 employees. Infosys also announced its acquisition of semiconductor design and embedded service provider InSemi for Rs 280 crore. The company said the strategic investment further strengthens its Engineering R&D capabilities. The acquisition is expected to close during the fourth quarter of fiscal 2024.
Talking about revenue guidance, Parekh said as we get closer to the end of the financial year, we have tightened the revenue growth guidance, and the margin guidance remains the same. The higher end has come a little bit lower, and the lower end has gone up a little bit. He also said that the company’s margin improvement programme continues to gain traction and that they have 1 lakh employees trained in Gen AI.