India’s second top IT company Infosys Ltd has announced its earnings for Q3 FY23. Its net profit came ahead of estimates at ₹6,586 crore while raising revenue guidance for FY23. Read here Infosys Q3 results.
The IT services company’s profit beat estimates, helped by a strong deal pipeline despite a challenging macro environment. Analysts on average had expected a profit of ₹6,500 crore, according to Refinitiv IBES data.
Infosys Q3 results
The company’s operating margin came at 21.5%, down from 23.5% as against the year ago quarter. Whereas it was flat from 21.5% in the previous quarter ended September 2022. The IT company’s revenue grew 20% YoY to ₹38,318 crore from ₹31,867 crore. It was up 5% quarter-on-quarter (QoQ) from ₹36,538 crore.
Infosys’ net profit rose 13.4% to ₹6,586 crore during October-December 2022 period, as compared to ₹5,809 crore in the year-ago quarter. The profit is up over 9% from ₹6,021 crore in the previous quarter.
Digital revenue comprised 62.9% of overall revenues and grew at 21.7% in constant currency (cc). Infosys’ attrition rate of IT services stood at 24.3% in the December 2022 quarter. Its down by 2.8% from 27.1% in September 2022 quarter. During the June 2022 quarter, the attrition rate was 28.4% .
In terms of total headcount, Infosys had total employees of 3,46,845 in Q3FY23, a net addition of 1,627 employees compared to 3,45,218 employees in Q2 of FY23.
Compared to the Q3FY22 quarter where the headcount was at 2,92,067 employees, Infosys’ net addition stood at 54,778 employees in Q3FY23
Infosys’ profit beat was in contrast to that of larger rival Tata Consultancy Services Ltd, which missed profit estimates and flagged challenges in Europe as clients tightened spending due to rough economic conditions.
“Operating margins in Q3 remained resilient due to cost optimization benefits which offset the impact of seasonal weakness in operating parameters”, said Nilanjan Roy, Chief Financial Officer. “Attrition reduced meaningfully during the quarter and is expected to decline further in the near-term”, he added.
“Our revenue growth was strong in the quarter, with both digital business and core services growing. As reflected in the large deals momentum, we continue to gain market share as a trusted transformation and operational partner for our clients. Our end-to-end capabilities and global scale make us a preferred choice as clients look at consolidating vendors. We remain focused on helping businesses accelerate their digital agenda to uncover new value and growth, as well as improve operational and cost effectiveness”, said Salil Parekh, CEO and MD.
Watch this video by CA Nitin Kaushik to Quarterly Results in detail.
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