Indian IT major Infosys on Thursday reported a consolidated Profit After Tax (PAT) of Rs 6,368 crore for the quarter ending 30 June 2024, noting a 7.1 per cent rise from the Rs 5,945 crore reported in the same period last year.
The growth in Q1 FY25 is accompanied by an increase in revenue from operations, which stood at Rs 39,315 crore, a 3.6 per cent rise from Rs 37,933 crore in Q1 FY24.
“We had an excellent start to FY25 with strong and broad-based growth, operating margin expansion, robust large deals, and highest ever cash generation. This is a testimony to our differentiated service offerings, enormous client trust, and relentless execution,” Salil Parekh, CEO and MD at Infosys said in a statement.
Infosys achieved a record number of large deal wins, securing 34 deals with a total contract value (TCV) of USD 4.1 billion, of which 57.6 per cent were net new contracts.
Sequential Decline In Net Profit And Headcount
Despite the year-on-year (YoY) growth, Infosys faced a big sequential decline. The company’s consolidated net profit fell by 20.1 per cent compared to Rs 7,975 crore in the previous quarter Q4 FY24. This was majorly due to a tax refund boost in the previous quarter.
On a positive note, revenue saw a quarter-on-quarter (QoQ) increase of 3.7 per cent, up from Rs 37,923 crore in the January-March quarter.
The revenue growth guidance for FY25 has been set at 3-4 per cent in constant currency.
Infosys has projected an operating margin of 20-22 per cent for the current financial year.
“Our relentless drive on cost optimisation through Project Maximus, a comprehensive margin expansion program, is reflected in the all-round improvement in key operating metrices leading to 1 per cent growth in operating margin in Q1,” said Jayesh Sanghrajka, CFO at Infosys.
“We had the highest ever FCF generation at USD 1.1 bn and ROE increased to 33.6 per cent due to higher payouts to investors,” he added.
In terms of geographical performance, the India region was the only one to see growth, increasing by 90 basis points to represent 3.1 per cent of total revenue. Conversely, the North American region saw a decline of 70 basis points, now accounting for 58.9 per cent of total revenue. Europe's share also decreased by 20 basis points, dropping from 28.6 per cent to 28.4 per cent.
The company also reported a decrease in its workforce, with the total number of employees in Q1 FY25 recorded at 3,15,332, down from 3,17,240 in Q4 FY24 and significantly lower than the 3,36,294 employees in Q1 FY24. Attrition during Q1 FY25 stood at 12.7 per cent.
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