Annual guidance narrowed, client wins: 7 takeaways from Infosys' results

The company revised for the third time its annual guidance marginally to 8.4-8.8% in the CC terms

Infosys, India's second-largest software services firm, on Friday reported a 2.3% sequential jump to Rs 3,708 crore in its profit after tax (PAT) for the December quarter of fiscal year 2016-17 against Rs 3,606 crore in the previous quarter, and Rs 3,465 crore (up 6.6%) in the same quarter of last fiscal year.

The company revised for the third time its annual guidance marginally to 8.4-8.8% in the constant currency terms, and 10-10.4% in dollar terms. 

“Taking into account seasonal and other additional headwinds for the quarter, our Q3 revenue performance was broadly in line with our expectations, said  Vishal Sikka, CEO and MD in a statement.

Below are top six takeaways from Infosys' December quarter results:

1) Revenues 

Revenue rose 8.6 per cent to Rs 17273 crore in the three month period to December. The company had reported profits of Rs 3606 crore on revenue of Rs 17310 crore in the third quarter last year.

2) Earnings per share

EPS in the third quarter grew 2.8% sequentially and 7% year-on-year to Rs 16.22. It stood at Rs 15.77 in the September quarter and Rs 15.16 in the December quarter last year. 

3) Margin growth

Q3 operating margins expanded 0.2% to 25.1% and net margins expanded 0.6% to 21.5% sequentially.

4) Attrition falls

Attrition declined sequentially by 0.8%  to 14.9% on standalone basis and 1.6% to 18.4% on consolidated basis. Standalone and consolidated attrition figures came in at 15.7% and 20%, respectively in the September quarter of FY17.

5) Management changes

The Company has appointed Ravikumar S as Deputy Chief Operating Officer with immediate effect. In addition to his current responsibility of heading the global delivery organization, Ravikumar will oversee certain strategic business enabling functions and will be based in India.

6) Digitisation

In Q3, we continued to make progress on our strategy to renew our core services, introducing new offerings in the areas of digital, cloud, data sciences, mainframe modernization, cyber security, API microservices, internet of things, and more, to help our clients renew their core businesses, said the IT major in a filing to BSE. 

In addition, the company's Zero Distance program continued to be a key strategic differentiator to drive ongoing, grassroots innovation in every project, it said. Zero Distance program is company's internal push to drive innovation in each projects it is handling. 

7 Client wins

Infosys said it added 77 clients during the three months to December, including two clients in the $75 million-plus revenue category.