Infosys Q4FY25 results: Net profit declines 11.7% to ₹7,033 crore

Infosys signals weak FY26 after muted Q4 result

Infosys, India’s second-largest information technology (IT) services provider, on Thursday predicted weaker than expected revenue growth for FY26, becoming the latest Indian IT company to signal a difficult year ahead, with global economic uncertainty, tariff disruptions, and cautious client spending clouding the sector’s outlook.

 

The company said it expected revenue growth for this financial year to be flat at 3 per cent on a constant currency basis, even as clients across verticals pulled back on discretionary spending.

 

“The environment is uncertain and clients are already seeing pressure on their budgets,” Chief Executive Officer Salil Parekh said at a press conference. “While we have not seen any project cancellations, we are giving this guidance while keeping in mind how things might unfold.”

 

 

Infosys’ net profit in the fourth quarter (Q4) of 2024-25 stood at ₹7,033 crore, down 11.7 per cent from a year earlier, as selling and marketing expenses increased. Revenue grew 7.9 per cent to ₹40,925 crore.

 

While the profit was above estimates, revenue missed Street expectations, according to Bloomberg.

 

For the full year, the net profit and revenue were up 1.8 per cent and 6.1 per cent, respectively. 

 

Infosys has joined a growing list of IT services companies that have sounded the alarm bells about technology spending. This began with Accenture cautioning about the loss of US federal contracts, and TCS and Wipro throwing more light on the challenging business scenario.

 

Wipro, the cross-town rival of Infosys, expects to be hit the hardest due to this turmoil.

 

Infosys’ net profit in the fourth quarter (Q4) of 2024-25 stood at ₹7,033 crore, down 11.7 per cent from a year earlier, as selling and marketing expenses increased. Revenue grew 7.9 per cent to ₹40,925 crore.

 

While the profit was above estimates, revenue missed Street expectations, according to Bloomberg. For the full year, the net profit and revenue were up 1.8 per cent and 6.1 per cent, respectively.

 

The company’s numbers for the full year — both in dollar terms and on a constant currency basis — are slightly better than those of TCS and Wipro.

 

Infosys’ dollar revenue grew 3.9 per cent, while TCS was a shade behind at 3.8 per cent. Wipro continued to lag its peers, reporting negative revenue growth for a second consecutive year.

 

Infosys, like Wipro, is banking on big-ticket deals to shore up its revenue this year. The company reported a large deal total contract value (TCV) of $2.6 billion for the fourth quarter.

 

Asked if large deals would take time to materialise, given the challenging scenario, Parekh said clients often prioritise such large cost optimisation deals in these times. That is similar to what he had said at the onset of the pandemic.

 

Such deals also involve cost efficiencies using generative artificial intelligence (Gen AI) and agentic AI. “We see a growing demand among clients to partner with us in AI and AI agents will continue to play a critical role. Some of the critical areas where these technologies are making an impact are productivity, process solving, engineering and customer service. GenAI is making a difference in how these deals are developed,” he explained.

 

Infosys’ revenue from financial services was up 12.6 per cent year-on-year (Y-o-Y) on a constant currency basis, while manufacturing was up 14 per cent. Retail was down 2.6 per cent in the comparable period.

 

Business from North America declined 0.4 per cent, but Europe came as a shot in the arm, growing 15 per cent. Overall, India business grew 43.7 per cent Y-o-Y. Operating margins for the fourth quarter were 21 per cent, an increase of 0.9 per cent Y-o-Y.

 

“This reflects our focus on identifying opportunities for efficiency and executing Project Maximus with discipline, after navigating through multiple headwinds in a challenging macro environment,” said Chief Financial Officer Jayesh Sanghrajka.

 

The company also announced the acquisition of US-based MRE Consulting and Australian cybersecurity firm The Missing Link at $36 million and AUD 98 million, respectively.

 

Both these deals are expected to close by the first quarter of this financial year. The company also added that Mitsubishi Heavy Industries had invested in HIPUS, an Infosys-led joint venture, which will help expand its presence in Japan.