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PremiumInfosys Q4 Results Highlights: Infosys, the second-largest IT services company in India, announced its Q4 results today, reporting a net profit of ₹7,975 crore in the March quarter, while total revenues came in at ₹37,923 crore. The company said its revenues in constant currency (CC) terms remained flat year-on-year (YoY) and declined by 2.2 per cent sequentially.
Infosys sees its revenue growth of 1-3 per cent in constant currency terms in FY25 while its expects an operating margin of 20-22 per cent. D-Street analysts had expected Infosys Q4 print to be tepid amid weakness in discretionary spending. The IT major’s deal pipeline remains healthy, while closures are somewhat challenging due to slower decision-making processes and furloughs.
Stay tuned to our Infosys Q4 results live blog for the latest updates.
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Shares of Infosys will be in focus during tomorrow's trading session after releasing its Q4 results today. Infosys ADR has crashed eight per cent on NYSE after the IT major slashed its FY25 revenue guidance.
Revenues in CC terms grew by 1.4% YoY
Reported revenues at ₹153,670 crore, growth of 4.7% YoY
Operating margin at 20.7%, decline of 0.4% YoY
Basic EPS at ₹63.39, increase of 10.0% YoY
FCF at ₹23,865 crore, growth of 16.7% YoY
FCF conversion at 90.9% of net profit
For the quarter ended March 31, 2024
Revenues in CC terms remained flat YoY and declined by 2.2% QoQ
Reported revenues at ₹37,923 crore, growth of 1.3% YoY
Operating margin at 20.1%, decline of 0.9% YoY and 0.4% QoQ
Basic EPS at ₹19.25, increase of 30.2% YoY
FCF at ₹7,032 crore, growth of 20.3% YoY
FCF conversion at 88.2% of net profit
The company reported a decline in growth in the financial services and retail verticals, but CEO Salil Parekh said he expects fiscal year 2025 to be better for financial services.
India's $254 billion IT sector has been struggling in recent quarters as clients cut spending on non-essential projects amid inflationary pressures.
This has led companies to accept tougher contract terms to win large deals, while grappling with clients renegotiating, delaying or cancelling contracts, resulting in a sharp slowdown in the industry's growth from the pandemic-fuelled boom a few years back.
"Our attrition has also come down significantly. That is the reason for net headcount reduction," said Infosys CFO Jayesh Sanghrajka. Free cash flow of USD 848 million in the fourth was highest in the last 11 quarters driven by our relentless focus to improve working capital cycle.
"Consistent with the objective of giving high and predictable returns to shareholders, the board has approved the capital allocation policy under which the company expects to return 85 per cent over the next five years and progressively increase annual dividend per share," said Sanghrajka.
Infosys announced that it will acquire a 100 per cent stake in German firm in-tech in an all cash deal for 450 million euros, or about ₹4,000 crore. in-tech develops solutions in e-mobility, connected and autonomous driving, electric vehicles, off-road vehicles and railroad.
The acquisition will bring Infosys, marquee German original equipment manufacturers (OEMs) deep client relationships, and industry expertise with a multidisciplinary team of 2,200 people across locations in Germany, Austria, China, the UK, and nearshore locations in Czech Republic, Romania, Spain, and India. The acquisition is expected to close in the first half of FY25.
The company's attrition rates have steadily declined over the past year — from 20.90 per cent in Q4FY23 to 12.6 per cent in the results shared on Thursday. It stood at 17.30 per cent in the first quarter of FY24 before dipping to 14.6 per cent in Q2FY24. Attrition stood at 12.9 per cent for the quarter ending on December 31 last year.
The large deal total contract value of Infosys for FY24 was the highest ever at USD 17.7 billion, with 52 per cent being net new. “Growth guidance for next year is higher than where we finished for this year. The difference is small. As we go into the industries, we see financial services to see a better outlook in the next year compared to the past year," said Infosys MD and CEO Parekh.
“Manufacturing will have slower growth this year. Given the outlook with discretionary spend, digital work remaining the same, more focus on cost efficiency and consolidation, we have created that revenue growth guidance," said Parekh.
The tech giant declared a final dividend of ₹20 per equity share for FY24. Along with this, it announced a special dividend of ₹8 per share.
“Recommended a final dividend of ₹20/- per equity share for the financial year ended March 31, 2024, and additionally a special dividend of ₹8/- per equity share," said the company in its stock filing.The record date for the payment of final dividend and special dividend is fixed as May 31, 2024. Whereas, the payment of the dividend to eligible shareholders will be made on July 1, 2024. The 43rd Annual General Meeting of Infosys members will be held on June 26.
Revenue from the domestic market saw a strong decline of 16.1 per cent YoY, the company said. Revenue from the North American market declined 2.1 per cent YoY. Europe and the rest of the world markets saw a YoY growth of 6.5 per cent and 1.6 per cent respectively.
“We delivered the highest ever large deal value in the financial year 2024. This reflects the strong trust clients have in us. Our capabilities in Generative AI continue to expand. We are working on client programs, leveraging large language models with impact across software engineering, process optimization, and customer support, said Salil Parekh, CEO and MD, Infosys.
Infosys said its revenues in constant currency (CC) terms remained flat YoY and declined by 2.2 per cent sequentially. Infosys reported a year-on-year decline in financial services, retail and others segment while hi-tech, manufacturing, saw a robust growth of about nin per cent YoY.
Infosys American Depository Receipts or ADR on the New York Stock Exchange (NYSE) dropped seven per cent in the pre market session after the IT major announced its Q4 results and slashed its FY25 revenue guidance.
Infosys slashed its revenue guidance for the fiscal 2025 to 1-3 per cent from 4-7 per cent from a year ago, amid uncertain demand conditions. Infosys expects an operating margin of 20-22 per cent, according to the IT major's exchange filings.
Infosys reported a net profit of ₹7,969 crore in the January-March quarter, reporting a rise of 30 per cent compared to the year-ago period. Revenue came in at ₹37,923 crore, rising 1.3 per cent YoY.
Nomura expects EBIT margin to remain flat in March quarter. Analysts projected a profit of ₹6,128 crore on revenue of ₹38,413 crore. Brokerages estimate that margins will remain steady despite weak revenue growth, as companies optimize costs and tighten discretionary spending.
Ahead of the announcement of March quarter results, shares of Infosys settled O.41 per cent higher at ₹1,420.55 apiece on the BSE
Infosys revenue guidance and EBIT margin will be keenly eyed by investors and analysts for the IT major's outlook trajectory. Key things to watch out for - commentary on cost takeout projects, banking vertical and outlook on client CY24 discretionary spend, according to brokerages.
Infosys Q4 Results Live: US$ sales are expected to decline by 0.7% (CC: 0.7% QoQ dip) led by seasonal softness and expected lower pass through sales. EBIT margins are expected to see marginal increase of 17 bps QoQ led by absence of one time cyber security related cost incurred in 3Q, expected better utilisations rates to be partly compensated by wage hikes (eff Nov 2023) and seasonal visa cost. We expect Infosys to guide CC US$ Sales growth guidance of 2.5-5.5% with EBIT margin guidance of 20-22% for FY25E, said Equirus Securities.
Infosys Q4 Results Live: We are building in -0.9% QoQ c/c revenue growth with ~20 bps cross currency tailwind translating into -0.7% QoQ USD revenue growth. We expect limited contribution from mega deals in Q4. We have not built meaningful contribution from InSemi acquisition. Margin tailwind: reversal of 60 bps one-off expense due to McCamish cyber incident; Headwind: Visa Cost, Wage hike (one month), said JM Financial.
Infosys Q4 Results Live: We expect a constant currency revenue decline of 1% QoQ due to continued weakness in discretionary spends and weak seasonality for Infosys. We expect EBIT margins to remain flat QoQ as there will be one month impact of salary hikes. Infosys will have visa costs in 4Q which will be compensated from non-occurrence of one-time costs of 3Q. Key things to watch out for - commentary on cost takeout projects, banking vertical and outlook on client CY24 discretionary spend, Nomura said.
Infosys Q4 Results Live: Infosys Q4 revenue growth is expected to be weak at -0.1% QoQ CC, on account of ongoing macro challenges and delays in the ramp-up of large deals. The deal pipeline remains healthy, while closure are somewhat challenging due to slower decision-making processes and furloughs. Nevertheless, the conversion rate remains on track. Operating margin should remain stable, due to weak growth. We expect the operating margin to be flat QoQ at 20.5%. We expect the company to provide initial FY25 revenue growth guidance band of 5-7%, factoring in deal scale up along with initial caution, said Motilal Oswal.
Infosys Q4 Results Live: The Indian IT services companies are likely to end the financial year 2023-2024 on a weak footing with the March quarter results estimated to show subdued growth amid unabated headwinds. The largecap IT services players are expected to report modest revenue growth in Q4FY24 as muted demand trends continue on account of weak discretionary spending and cautious behavior by clients, amid an uncertain global macroeconomic situation. Analysts believe margins to remain steady despite weak revenue growth, as companies optimize costs and tighten discretionary spending.
Infosys Q4 Results Live: Infosys share price gained over 2% on Thursday ahead of the announcement of Q4 results today. Infosys shares rose as much as 2.10% to a high of ₹1,444.50 apiece on the BSE.
However, Infosys share price has failed to give any returns this year. Infosys shares have fallen over 11% in one month and over 7% year-to-date (YTD). Infosys stock price is up more than 13% in the past one year.
Infosys Q4 Results Live: Nuvama Institutional Equities estimates steady deal-wins and conservative commentary on demand environment and expects Infosys to guide for 3–5% CC YoY revenue growth and margins in 20–22% range for FY25.
Infosys Q4 Results Live: Going ahead, key things to watch out for in Infosys Q4 results are the commentary on cost takeout projects, banking vertical and outlook on client CY24 discretionary spend.
Infosys Q4 Results Live: Infosys is expected to provide constant currency (CC) USD revenue growth guidance in the range of 2.5% - 5.5% with EBIT margin guidance of 20% - 22% for FY25.
Infosys Q4 Results Live: On the operational front, Infosys’ Earnings before Interest and Taxes (EBIT) during the quarter ended March 2024 is expected to fall 0.69% to ₹7,906 crore from ₹7,961 crore in the December quarter. EBIT margin is estimated to remain stable at 20.5% QoQ as margin headwinds from the partial wage hike impact and visa costs could offset gains from the absence of one-offs and operational efficiency, as per average estimates.
Infosys Q4 Results Live: Infosys Q4 revenue in USD terms is expected to fall 0.38% to $4,645 million from $4,663 million on a quarter-on-quarter (QoQ) basis, led by seasonal softness and expected lower pass-through sales. In rupee terms, revenue is estimated to decline 0.59% to ₹38,590 crore from ₹38,821 crore sequentially due to continued weakness in discretionary spending and weak seasonality.
Infosys Q4 Results Live: Infosys is expected to post a net profit of ₹6,142 crore in the quarter ended March 2024, registering a muted growth of 0.58% from ₹6,106 crore reported in the December quarter, as per average estimates of seven brokerages.
Infosys Q4 Results Live: Infosys Q4 results are expected to be tepid amid weakness in discretionary spending. While Infosys Q4 revenue is estimated to drop sequentially, EBIT margin may remain flat on account of a slew of weak growth.
Infosys Q4 Results Live: The meeting of the Board of Directors of Infosys is being held on Wednesday and Thursday, April 17 and 18, and the financial results will be presented to the board on April 18 for their approval. The board will also recommend a final dividend for the financial year ending March 31, 2024. Infosys will hold investor or analyst calls today to discuss the financial results for the quarter and year ending March 31, 2024, and the business outlook.
Infosys Q4 Results Live: IT major Infosys will announce its earnings for the fourth quarter of FY24 today, 18 April, 2024. Infosys Q4 results will be the second quarterly earnings report from the IT sector after Tata Consultancy Services (TCS) released its March quarter earnings last week.
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