Wipro Q1 preview: IT giant to post muted sequential show amid demand woes

Wipro Q1 preview: IT firm's Q1 revenue may dip 1.7 per cent Q-o-Q; profit likely to fall over 9 per cent, say analysts

Wipro Q1 results preview: Information technology (IT) major Wipro is expected to post muted first-quarter earnings, in line with peers, amid weak demand and tariff uncertainty.

 

The IT firm will report its earnings for the quarter ended June on July 17, Thursday.

 

The tech major’s revenue is expected to decline marginally by 1.7 per cent quarter-on-quarter to ₹22,121.30 crore, according to consensus estimates tracked by Business Standard. Amid a decline in margin, Wipro's bottom line is likely to slip over 9 per cent to ₹3,239.75 crore. 

 

However, on a year-on-year (Y-o-Y) basis, the top and bottom line is expected to rise by 0.72 per cent and 7.88 per cent, respectively. 

 

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Weak demand and continued headwind in the European region countries will likely contribute to the weak quarter, analysts said. Currency tailwinds, along with aggressive cost management, will likely act as tailwinds for the company. 

 

Going ahead, the rationale for weak Europe revenues, large deal pipeline and win rates, turnaround progress, and client spending behaviour will be in focus during management commentary.  

Here's how analysts of various brokerages expect Wipro to fare in Q1:

Motilal Oswal: The brokerage expects Wipro to report a 2.5 per cent constant currency (CC) revenue decline in its IT services business for the June quarter. It cited weakening client spending trends observed at the end of Q4 FY25 as the key driver behind the projected decline. Operating margins are expected to remain flat at around 17.5 per cent, with downside risks stemming from a subdued revenue environment and pricing pressures amid vendor consolidation. 

 

Regionally, Europe may continue to face headwinds due to ongoing client-specific challenges and project ramp-downs. However, Motilal Oswal notes that the execution of Wipro’s new leadership strategy and the ramp-up of a major deal in the second half of the fiscal year could provide some relief.

 

The brokerage also flagged potential risks around digital transformation projects, highlighting that some initiatives are being paused or having their timelines adjusted. 

 

Kotak Securities: Analysts expect the IT firm to report a 2.7 per cent sequential revenue decline in the June quarter, aligning with the midpoint of the company’s guidance range of -1.5 to -3.5 per cent. The weak performance is likely driven by subdued demand and company-specific challenges in Europe, it said. 

 

Despite the revenue decline, Kotak projects stable Ebit margins, supported by aggressive cost control measures and favourable currency movements.

 

The brokerage anticipates strong large deal wins, with total contract value (TCV) estimated at $1.2-1.3 billion. For the September 2025 quarter, Kotak expects the company to guide for revenue growth in the range of (-)1 to (+)1 per cent. 

 

ICICI Securities: The brokerage expects Wipro to report a 2.6 per cent Q-o-Q decline in constant currency (CC) revenue. The revenue is expected to be impacted by the bankruptcy of Marelli, which could affect nearly 20 days of business in the quarter, it said. The large Phoenix deal announced in Q4FY25 is projected to begin ramping up from Q3FY26, offering a potential growth lever in the second half of the fiscal year.

 

Discretionary spending remains weak, with clients holding back amid ongoing uncertainty around global trade tariffs. However, the deal pipeline remains healthy across key verticals, including banking, financial services and insurance (BFSI), healthcare, and technology. The brokerage expects a 67 basis points sequential decline in Ebit margins, primarily due to the fall in revenue.