Top comments and highlights from Infosys Q2 earnings press conference
- Infosys second quarter earnings surprised market by reporting earnings closer to the upper end of the guidance.
- The company has also increased its full-year guidance to 9% to 10%.
- The surprise in Infosys' earnings and guidance has been more due to disappointment from TCS a day earlier.
Infosys' second-quarter revenue grew 3.3% in constant-currency terms compared to three months earlier. The growth was over 11% compared to the same quarter last year-- making this quarter the fourth straight quarter of double-digit growth.
The following are the top comments from the management and other highlights from the earnings press conference:
1. 6 out of 7 segments have shown strong double-digit growth in the second quarter.
2. Voluntary attrition has come down by 18%.
3. Looking to optimise cost and margin has widened by 110 basis points.
4. Looking at ways to increase the price of digital services-- because the skills and the talents are scarce.
5. Reduced consumption has led to softness in IT spending by retail clients.
6. Seen some slowdown in European banks, capital markets. There is nothing new in material terms.
7. The second half of the year is expected to be slower, as it is every year.
8. Digital services now make for 38% of the total business and this segment grew over 38% in constant-currency terms compared to three months ago.
9. Bagged a new deal to improve the user experience for a global confectionery company.
10. Hired 7,457 employees during the quarter.
11. Total impact due to exchange rate was negative 15 basis points due to weaker pound, even as there was benefit from stronger dollar.
12. Most of our work today happens at the clients' premises. Some of it will be moved to our hubs. The innovation centres will be around the hubs where the clients can come.
13. Local hires in US make for 50% of the workforce and the hiring of freshers has helped the cost structure.
14. $2.8bn in large deal wins during the quarter was the highest ever taking the total for the first six months of financial year 2020 to $5.6bn.
15% The current tax rate is marginally below 25% even before the tax cuts were announced by the government.
TCS earnings growth gets squeezed by slowing economies across the world