India’s second-largest information technology company Infosys has reported a 11.4% rise in year-on-year profit for the April-June quarter amid the disruption caused by the Covid-19 pandemic. The Bangalore-based company has recorded a consolidated profit of 42.33 billion rupees (US$563 million), as against 37.98 billion rupees in the year-ago quarter. However, sequentially it has fallen 1.45%.
Its revenue for the quarter under review stood at 236.65 billion rupees ($3.14 billion), up 8.5% from last year. It was mainly driven by digital revenues, which stood ad $1.3 billion and contributed 44.5% to total revenue in this quarter. The company also signed deals worth $1.74 billion during the quarter.
Infosys CEO Salil Parekh said, “Our Q1 results, especially growth, are a clear testimony to the relevance of our service offerings and deep understanding of clients’ business priorities, which is resonating with them in these times. It also demonstrates the remarkable dedication of our employees and leadership during this period.” He said the company’s confidence and visibility for the rest of the year is improving “driven by our Q1 performance and large deal wins.”
Chief Financial Officer Nilanjan Roy said, “Operating margin expanded to 22.7% driven by preemptive deployment of our strategic cost levers along with the tactical opportunities triggered by the Covid situation. Collections were robust and capex was focused, which led to a 50% year on year increase in free cash flows. Our liquid and debt free balance sheet is a huge source of strength in these times.” The company said its voluntary attrition for IT services declined to 11.7% from 20.2% in the previous quarter.
Various brokerages had pegged lower numbers for Infosys due to the pandemic disruptions. Chief Operating Officer Pravin Rao said, “During the last few months, we took multiple steps aimed at employee safety and well-being while providing seamless services to our clients. Clients have recognized us for the speed, security and effectiveness of our remote work efforts,”
Earlier on Tuesday, Wipro had posted a flat 0.11% year-on-year growth in net profit at 23.90 billion rupees for the April-June quarter as against 23.87 billion rupees in the corresponding quarter last year.
Last week the country’s largest software company, Tata Consultancy Services, had reported 13.81% fall in year-on-year profit at 70.08 billion rupees for the April-June quarter.