Wipro Q1 revenue beats its forecast

Bengaluru: Wipro’s first-quarter IT services revenue growth topped its estimates but the it forecast muted growth for the second quarter and announced a Rs 11,000 crore buyback.

For the quarter ended June 30, Wipro’s IT services revenue grew 0.3% sequentially in constant currency to $1.97 billion. Net income dropped to $321 million or Rs 2080 crore. IT services margins dropped over nearly 200 basis points to 16.8%.

The Bengaluru-headquartered IT company had expected revenue of $1.91-$1.95 billion.

For the quarter ending September 30, Wipro said it expects its revenue to be in range of $1.96-$2.00 billion, implying a drop of 0.5% and a growth of 1.5%.

“We delivered revenues above the upper end of the guidance range. Our focus on Digital combined with our investments in client mining have resulted in strong growth in Top accounts.” said Abidali Z. Neemuchwala, Chief Executive Officer and Member of the Board, said. “The brand refresh is reflective of the transformation we are driving at Wipro and how we are helping our customers in their digital journeys.”

The company also said its board of directors had approved a buyback proposal to purchase 343.75 million shares of the company at a buyback price of Rs 320, leading to a total buyback of Rs 11,000 crore.

IT services companies from TCS and Cognizant, to Infosys and now Wipro have been buyback back shares as investors push for higher returns in the face of slowing growth.