Infosys Q2 profit falls 2% YoY, but meets Street estimates; firm raises revenue guidance

Infosys on Friday reported a 2.21 per cent year-on-year fall in consolidated net profit at Rs 4,019 crore for the quarter ended September 30. The IT major had posted a profit of Rs 4,110 crore in the corresponding quarter last year.

Analysts in an ET NOW poll had projected a net of Rs 4,040 crore.

Total income increased to Rs 23,255 crore from Rs 21,348 crore in the same period last year.


“Our performance was robust on multiple dimensions – revenue growth, digital growth, operating margins, operational efficiencies, large deal signings and reduction in attrition,” said MD and CEO Salil Parekh.

“All these are clear signs that we are progressing well in our journey of client-centricity and maximising value for our stakeholders,” he added.

The firm increased lower-end of FY20 revenue guidance. The revised guidance stands at 9-10 per cent in constant currency terms. Infosys maintained its operating margin guidance in range of 21-23 per cent.

The second-largest IT exporter also declared an interim dividend of Rs 8 per share.

According to CFO, Nilanjan Roy, the company saw expansion in operating margins during the quarter driven by improvement in operational parameters and cost efficiencies. “We took the first step towards the implementation of our new capital allocation policy by increasing the interim dividend by over 14 per cent compared with FY19,” said Roy.

Operating margin of the company came in at 21.70 per cent for the quarter ended September 30, against 23.70 per cent last year. Operating profit increased 0.40 per cent to Rs 4,912 crore over Rs 4,894 crore.

“Q2 witnessed another quarter of all-round growth in industry segments and geographies, which is a testimony to our strong credentials and client relevance,” said COO Pravin Rao.

“Large deal wins were $2.8 billion. We are especially pleased by the reduction in attrition driven by our focus on enhanced employee value proposition,” he added.