Infosys Q1 profit falls 4.5 pct, FY17 dollar revenue guidance slashed

IT major Infosys missed the analysts' estimates on revenues for the June quarter and reported a net profit on expected lines as the quarterly net profit declined 4.5 percent sequentially to Rs. 3,436 crore and revenue increased 1.4 percent to Rs. 16,782 crore.

The company's revenue in dollar terms grew by 2.2 percent to USD 2,501 million and constant currency dollar revenue growth stood at 1.7 percent compared with preceding quarter.

"We had unanticipated headwinds in discretionary spending in consulting services and package implementations as well as slower project ramp-ups in large deals that we had won in earlier quarters, resulting in a lower than expected growth in Q1," said CEO and MD, Vishal Sikka.

The company lowered its constant currency revenue growth guidance to 10.5-12 percent from 11.5-13.5 percent. This is slightly similar to NASSCOM's industry guidance of 10-12 percent.

"Brexit impact is not factored into FY17 guidance that is based on our own visibility of market," added Sikka.

He further added that the lower guidance was due to weaker spend in consulting and macro economic uncertainty.

"Deal wins for the June quarter crossed USD 800 million in total contract value (TCV). Infosys added 34 clients during the quarter, taking total count to 1,126 at the end of June 2016. It added three clients in USD 100 million category, taking total count to 17 and three clients in USD 10 million category, taking total count to 180," added Vishal Sikka.

Infosys added 3,006 employees during the quarter, taking total employees count to 1.97 lakh.