Infosys reports 4.95% QoQ jump in net profit, lowers FY17 revenue guidance to 8-9%


NEW DELHI: Infosys on Friday reported a 4.95 per cent quarter-on-quarter (QoQ) rise in net profit to Rs 3,606 for the quarter ended September 30.

The second largest domestic IT firm by sales had reported a net profit of Rs 3,436 crore in June quarter.

The numbers were a bit better than Street estimates, given the firm had already informed stock exchanges of challenges it was facing, owing to ramp down in RBS contract and other client specific issues. That had led to moderation in earnings expectations. An ET Now poll of analysts had anticipated a net profit of Rs 3,531.50 crore for the quarter.

However, the company lowered its revenue guidance (constant currency) for FY17, which hurt the sentiment.

The company said its net sales stood at Rs 17,310 crore for the quarter against Rs 16,782 crore revenue it reported in the June quarter. The ET Now poll had forecast Rs 17,189.30 crore revenue for the September quarter, up 4.48 per cent QoQ.

Dollar revenue for the quarter stood at $2,587 million against $2,501 million in June quarter. As per analysts polled by ET Now, the Vishal Sikka-led firm was expected to report a 2.52 per cent quarter-on-quarter (QoQ) growth in dollar revenues to $ 2,564 million.

The company cut its FY17 revenue guidance for second time this year to 8-9 per cent against 10.5-12 forecast earlier. This was largely in line with Street expectations. Dollar revenue guidance was lowered to 7.5-8.5 per cent from 10-11.5 per cent earlier.

The company will conduct a 60 minute conference call at 11:30 a.m. IST where the senior management will discuss the
company’s performance and answer questions from participants.

“Results from tech majors such as Accenture and Cognizant have indicated mixed demand environment, with stronger adoption of digital technologies. However, market will be concerned about the impact of Brexit and the resultant impact on demand in the short term. US elections will also create uncertainty for the sector. Structural growth drivers for Indian IT continue to be in place, but in short term, there is increased uncertainty on demand outlook,” Prabhudas Lilladher said in a note.
The company board has announced a dividend of Rs 11 per share. The stock plunged over 5 per cent below Rs 1,000-level following the numbers.