Infosys's Q1 results: Net profit surges 9% YoY to ₹6,921cr
What's the story
Infosys, India's second-largest IT services exporter, has reported a consolidated net profit of ₹6,921 crore for the first quarter ending in June. This marks a year-on-year growth of 9%. The company's revenue from operations also witnessed an increase of 8%, amounting to ₹42,279 crore during the same period. CEO and MD of Infosys, Salil Parekh, attributed this performance to their enterprise AI capabilities and client consolidation decisions.
Guidance update
Infosys revises FY26 revenue growth guidance
Infosys has revised its revenue growth guidance for the fiscal year 2025-26. The company now expects a growth of 1-3% in constant currency terms, up from the earlier projection of 0-3%. Parekh said, "Our performance in Q1 demonstrates the strength of our enterprise AI capabilities, the success in client consolidation decisions, and the dedication of our over 300,000 employees."
Performance
Revenue growth in constant currency terms
In constant currency terms, Infosys's revenue grew by 3.8% year-on-year and 2.6% quarter-on-quarter in the first quarter. The company secured deals worth $3.8 billion during this period, with 55% being net new contracts. Parekh emphasized that these large deal wins reflect the firm's unique competitive positioning and strong client relationships.
Financials
Gross profit rises to ₹13,055cr
Gross profit for the reporting period rose to ₹13,055 crore from ₹12,138 crore in the same period last year. The company's operating margin for the April-June quarter was at 20.8%, a decline of 0.3% year-on-year and 0.2% quarter-on-quarter. Despite this, Infosys expects its operating margin to remain between 20-22% for the rest of FY26.
Segments
A look at the sectoral performance
The financial services segment posted a constant currency growth of 5.6% year-on-year, while the manufacturing division grew by a healthy 12.2%. However, the retail and hi-tech business segments saw marginal growths of 0.4% and 1.7%, respectively. The Life Sciences and other divisions de-grew by 7.9% and 15.3% in constant currency terms, respectively.