Infosys drops $20-billion revenue target: Is this why Sikka's salary fell?

Infosys CEO Vishal Sikka took home $6.7 mn in FY17 as against the contracted $11 mn

Infosys, India’s second-largest information technology (IT) services firm, seems to have dropped its ambitious target of increasing its revenue to $20 billion by 2020, as its Chief Executive Officer (CEO), Vishal Sikka, struggles to grow the business faster.

The company had set itself a long-term goal of $20 billion in revenue, 30 per cent operating margin and $80,000 revenue per employee by March 2021. Sikka’s compensation of $11 million was linked to this long-term goal. 

Two former senior executives of Infosys said the company’s 2016-17 annual reports have not mentioned anything about the $20-billion revenue target, while two previous annual reports clearly mentioned the aspirational revenue target. 

Former Infosys board member V Balakrishnan has doubts whether the exclusion of this target from the annual report resulted in lesser salary for Sikka. The Infosys chief executive took home $6.7 million in FY17 as against the contracted $11 million as he slipped on mobilising the company to execute and achieve his initial target of double-digit growth. 

"Infosys has silently removed the point on $20-billion revenue target from the FY17 annual report. Dumping the target may also result in a drop in Sikka’s salary as it was officially linked to this goal," said Balakrishnan. The Mint reported the development first on Thursday.

  

Infosys senior executives, including Chief Operating Officer Pravin Rao and Sikka, have always maintained that this target has been motivational for employees and targeted at achieving a higher goal. The company’s revenues stood at $10.2 billion in FY17. The company had earlier said that the ambitious $20-billion target would also include inorganic growth through acquisitions.