Wipro optimistic about next fiscal owing to AI to reduce operating costs

Wipro is feeling a "bit more" optimistic about its next financial year as clients spend more on artificial intelligence (AI) to reduce operating costs, the head of the Indian IT firm's Americas 2 business told Reuters on Wednesday.

"Most client conversations are about cost-saving efforts and there is a conversation every time about AI," Suzanne Dann said in an interview at the World Economic Forum in Davos, Switzerland.

"Many of them are still transforming to cloud and now they recognise the advantage of AI and add components to improve productivity."

Americas 2 encompasses banking, insurance and Canada, and accounted for around 30% of Wipro's overall revenue in October-December, the third quarter of its financial year.

Wipro, India's fourth largest IT firm, is having a tough year. Last week it forecast constant currency revenue this quarter within a range of down 1.5% to up 1.5%, indicating full-year revenues could fall for the first time in three years.

In the same interview, Americas 1 CEO Srini Pallia said 2024 would be the "pivotal year" for clients implementing generative AI technology, adding growth in the AI category would probably resemble the hockey stick-shape forecast by analysts at Gartner.

Americas 1 covers retail, healthcare, transportation and Latin America, and accounts for nearly a third of Wipro's revenue.

The Times of India this month reported that three internal candidates, including Pallia and Dann, were being groomed to succeed Wipro CEO Thierry Delaporte.

Pallia dismissed this as "speculations".

Asked about Wipro's lack of $500 million-plus mega deals this fiscal year, Pallia said some large outsourcing contracts were broken into smaller contracts won by several IT firms, adding the company had a "good pipeline".

Wipro's Chief Growth Officer Stephanie Trautman, who headed the large deals team, resigned in December.