India's Infosys pegs fiscal year 2027 revenue growth at 1.5%-3.5%
- Revenue from the financial services segment, its largest, grew 5% in the quarter ended March
BENGALURU: Infosys, India’s second-largest IT services firm, on Thursday forecast 1.5%-3.5% revenue growth for fiscal 2027, slightly below expectations, with the management saying the demand environment remained steady.
U.S.-listed shares fell 4.7% in premarket trading.
The company reported quarterly revenue that beat analysts’ estimates, aided by a pickup in demand from its financial services, energy, and communication segments.
Infosys had earlier flagged “good outlook” in the banking and energy segments for the fiscal year that started in April due to artificial intelligence-led demand.
Revenue from the financial services segment, its largest, grew 5% in the quarter ended March.
“We expect acceleration of growth in financial services, and in energy, utilities, resources and services verticals,” chief executive Salil Parekh said in a post-earnings call.
India’s $315-billion IT industry has been struggling with weak tech spending in key markets as clients focus on essential jobs or cost-optimising initiatives amid geopolitical turmoil and macroeconomic uncertainties.
India’s Infosys earned 5.5% of third-quarter revenue from AI services, CEO says
However, a sharp fall in the rupee’s exchange rate has boosted revenue, as software services companies bill in foreign currencies while incurring most costs in rupees.
Larger rival Tata Consultancy Services has reported better-than-expected quarterly results while allaying concerns about the business impact from AI tools. Wipro forecast a weak first quarter, citing muted demand.
Infosys’ consolidated sales rose 13.4% to 464.02 billion rupees ($4.93 billion), surpassing analysts’ average estimate of 460.30 billion rupees, according to data compiled by LSEG.
The Bengaluru-based tech major’s net profit rose 20.87% to 85.01 billion rupees, surpassing the 74.65 billion rupees expected by analysts.
Large order bookings, or deals over $30 million, stood at $3.2 billion during the quarter, compared with $4.8 billion in the previous quarter and $2.6 billion in the year-ago period.
Its Mumbai-listed shares closed 2.2% lower ahead of the results.