Wipro posts muted Q1 numbers; net profit up 2% to Rs 21.2 billion

Third largest IT service provider Wipro posted net profit of Rs 21.2 billion for the quarter ended 30 June, up 2.1 per cent over the same quarter last year.

Gross revenue was Rs 139.8 billion ($2.0 billion), up 1.5 per cent sequentially and 2.6 per cent compared to the year ago period. IT services segment revenue stood at Rs 137 billion ($2.0 billion), up 2.2 per cent quarter on quarter-on-quarter (QoQ) and 5.2 per cent year-on-year (YoY).

IT services margin for the quarter was 17.2 per cent, including gain of Rs 2,529 million from the sale of their hosted data center business during the quarter.

"We have seen pickup in spending in the developed markets, particularly in North America and BFSI. Our investments in digital continue to help us build differentiation in key industry segments, which is resulting in a consistent improvement in our client metrics. We have had a good quarter of order bookings and I am confident we are moving in the right direction," said Abidali Z Neemuchwala, CEO, Wipro.

The company's IT products segment revenue for the quarter ended June 30, 2018 was Rs 3.5 billion ($51.6 million).

Employee count increased by a little more than 800 to close 164,659 with gross utilization of employees touching a high of 74.5 per cent rising 140 basis points. Attrition is up to 17 per cent compared to 15.9 a year ago.

Wipro announced a long-term relationship with Alight Solutions, a technology-enabled health, wealth, HR and finance solutions provider, which will reshape the HR services industry by providing Alight's clients with the breadth and depth of capabilities from the two industry-leading organizations.

Wipro will also acquire and take on responsibility for the services delivered from Alight's India locations in Gurgaon, Naida, Mumbai and Chennai.

“We expect Revenue from our IT Services business to be in the range of $2,009 million to $2,049 million. This translates to a sequential growth of 0.3% to 2.3%, excluding the impact of the divestment of our hosted data center services business which concluded in the quarter ended June 30, 2018,” said the company in a statement.

The company reported 40 customers with revenues above $50 million.