India’s second largest IT services company Infosys reported a 3.17 per cent increase in net profit to Rs 5,360 crore in the June quarter as against Rs 5,195 crore in the same quarter last year. The profit is a tad less than what an ET NOW poll of analysts had anticipated at Rs 5,550 crore.
The IT major has raised full-year FY23 revenue guidance to 14-16 per cent from 13-15 per cent stated earlier. It has retained margin guidance at 21-23%. In constant currency terms, Infosys’ revenue jumped by 21.4 per cent on year and 5.5 per cent quarter on quarter. Operating margin at 20.1 per cent, declined 3.6 per cent YoY.
The revenue growth was broad based across the business verticals, however, supply side challenges and higher travel costs posed an impact on the margins for the company. Digital accounted for 61 per cent of overall revenues, growing at 37.5 per cent in constant currency.
Infosys CEO and MD Salil Parekh said their strong overall performance in Q1 amidst an uncertain economic environment is a testament to our innate resilience as an organisation, our industry-leading digital capabilities and continued client relevance.
We continue to gain market share and see a significant pipeline driven by our Cobalt cloud capabilities and differentiated digital value proposition. We are investing in rapid talent expansion while ensuring rewarding careers for our employees, to better serve evolving market opportunities, he added.
The company’s attrition rate surged to 28.4 per cent in the June quarter from 27.7 per cent in the preceding March quarter.
“We are fueling the strong growth momentum with strategic investments in talent through hiring and competitive compensation revisions. While this will impact margins in the immediate term, it is expected to reduce attrition levels and position us well for future growth. We continue to optimize various cost levers to drive efficiency in operations,” said Infosys CFO Nilanjan Roy.
In revenue contribution by geography, the US emerged as the leader, accounting for 61.8 per cent of the top line. Europe accounted for 25 per cent, rest of the world 10.6 per cent and India or domestic operations 2.6 per cent.
