Infosys share price jumps by more than 9% after Q1 earningsIANS
Infosys share price is up by over 9% after the Indian IT services company reported its earnings on Wednesday.
While its quarterly numbers may have been in the red, Infosys’ Q1 earnings fared better than its peers like Tata Consultancy Services (TCS) and Wipro.
Infosys share price had already jumped by over 6% ahead of the earnings on Wednesday.
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Infosys share price is up by over 9% since Indian markets opened today morning. The IT services behemoth reported a 4.5% drop in profit and a 2% dip in revenue quarter-on-quarter. While the numbers may be in the red, Infosys has outperformed its peers — Tata Consultancy Services (TCS) and Wipro — who have already announced their first-quarter results.
The uptake in Infosys share price comes after the stock value was already on the rise by over 6% on Wednesday, ahead of the company’s earnings announcement.
Last week, Tata Consultancy Services (TCS) reported that its revenue fell by 7.1% as compared to the previous quarter. For Wipro, the revenue was down by 5.3% By that comparison, Infosys 2% dip in revenue seems marginal.
However, when it comes to profits Wipro reported a 2.1% increase but TCS’ profit plummeted by 13.5%.
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Infosys was also the only Indian IT services company so far to issue guidance for the coming of between zero to 2% annual growth.
With more employees working from and the depreciation of the rupee — which helps IT companies since they operate abroad and most of the billings are in dollars — Infosys was also able to expand its operating margins by 1.6%.
The margin expansion could have been larger but the company increased the variable pay of its employees, which cost it around 110 basis points of benefits.
“We see a strong pipeline across our verticals, of course, financial services being the largest,” said Infosys’ chief financial offer Ninaljan Roy during the earnings call.
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Verticals with the most amounts of interest are cloud, workplace transformation, digital transformation, automation and cost-efficiency. “We are also seeing demand in the area of consolidation,” said CEO Salil Parekh.
Chief operating officer, Pravin Roy, added that when it comes to retail, aside from groceries, all other segments — from apparel to logistics — are seeing contraction and supply chain disruptions. “One on their key focus is on variating their costs. They’re also looking at continued investment,” he said.
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