Wipro takes $14-16 million Covid-19 hit in Q4 skipping guidance and increments

• Wipro’s quarterly net profits have dipped by 5.3% to $304 million.
• Coronavirus took away $14-16 million from IT services revenue.
• Jatin Dalal, Wipro’s chief financial officer, explained that the company won’t be releasing any guidance for the coming quarter in view of the global volatility.

The pressure of the pandemic has started to reflect in fourth-quarter earnings of IT giant Wipro. Its net profits dipped by 5.3% to $304 million from ₹321 million in the last quarter.

“We estimate that the IT Services revenues for the quarter ended March 31, 2020 were negatively impacted by COVID-19 by approximately $14 -$16 million,” said the company in a statement.

Its dollar revenues, however, marginally increased by 1.6% to $2.05 billion from $2.02 billion from the third quarter. However, revenue from its IT services fell by 1% to $2.07 billion in Q4 2020. The operating margin for IT services also took a hit falling by 0.8% as compared to last quarter.

Last quarter, most of its growth came from banking, financial services and insurance (BFSI), accounting for nearly one-third of IT services.

In light of the uncertainty in the market and the volatility in global markets, Wipro decided not to provide guidance for the coming quarter. But they remain confident that once things get back to normal, the company will be able to recuperate its losses.

“We are confident that our broad portfolio of services and our ability to execute our commitments makes us well-positioned to gain market share,” said Abidali Z Neemuchwala, the CEO and managing director of Wipro.

In the last quarter, it won four deals in IT services, including one with the largest Spanish language media companies and another with a large US-based healthcare company.

“The quarters ahead seem challenging and require a tremendous response on costs,” said Jatin Dalal, the chief financial officer.

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