Infosys reported a 12% jump on-year basis in net profit during the October-December quarter of the current fiscal year, beating street estimates. India’s second-largest information technology company Infosys reported a net profit of Rs 5,809 crore. That is against Rs 5,197 crore during the same period last year.
The Bengaluru-based firm said it delivered a strong Q3 performance with sequential growth in a seasonally weak quarter. Infosys outlined that its growth remained broad-based and deal momentum robust, with digital transformation rapidly scaling across verticals and regions.
Revenue rose to Rs 31,867 crore against Rs 25,927 in the year-ago period. Analysts had estimated Infosys’ net profit to rise in the range of 7-10% during the third quarter of the financial year. Infosys’ share price rose 1.2% to close the day’s trade at Rs 1,877 per share.
The company has revised revenue guidance for FY22 upwards to 19.5%-20%, powered by sequential growth of 7% in Q3.
On Wednesday, ahead of the results, Infosys scrip rose 1.09% to close at ₹1,875 apiece on NSE. In the last year, the stock has surged 36.65% comfortably beating the Nifty IT index which gained 24.75% in the same period.
Infosys said growth remained broad-based during the quarter and deal momentum robust, with digital transformation rapidly scaling across verticals and regions.
The IT major also reported a 7.7 percent on-quarter rise in consolidated revenues to Rs. 31,867 crore for the reported quarter driven by the hybrid cloud partnership with German auto major Daimler announced in December 2020. The ramp-up of large deals and growth across verticals.
“Our strong performance and market share gains are a testament to the enormous confidence our clients have in us to help them in their digital transformation,” said Salil Parekh, managing director and chief executive officer at Infosys in a press statement.
In constant-currency terms, Infosys’ consolidated revenues grew 7 percent sequentially.
Financial Highlights
On the operating front, the company’s consolidated operating profit grew 7.3 percent sequentially to Rs. 7,484 crore even as selling and marketing expenses climbed 7.3 percent on-quarter.
However, Infosys reported a 10 basis points quarter-on-quarter contraction in consolidated operating margin to 23.5 percent owing to continued costs towards trying to retain talent in the company.
The company’s struggles with high attrition continued in the December quarter as the voluntary attrition rate skyrocketed to 25.5 percent from 20.1 percent, a quarter ago.
“Despite the cost escalations driven primarily by supply-side challenges, we delivered another quarter of healthy margins, with improved cost optimization, continued operating leverage, and a stable pricing environment,” said Chief Financial Officer Nilanjan Roy.
During the reported quarter, Infosys added two new clients each in the $100 million-plus category and $50 million-plus category. Staff utilization including trainees dipped to 82.7 percent from 84.1 percent in the previous quarter likely due to lower workdays in the quarter.
