Infosys Q3 Results: FY24 revenue growth guidance revised; Wage hikes impact margin

The company reported US Dollar revenue decline of 1.2% on a sequential basis to $4,663 million. This is in-line with the CNBC-TV18 poll of $4,634 million. In rupee terms, revenue declined by 0.4% from the September quarter and was in-line with the CNBC-TV18 poll of ₹38,555 crore.

EBIT margin during the quarter stood at 20.5%, which is 70 basis points lower than the previous quarter and in-line with the 20.4% estimate of a CNBC-TV18 poll. Margin was seen lower for the quarter due to the wage hike that took effect on November 1, 2023. This was partially offset by a depreciating rupee.

Deal wins during the quarter stood at $3.2 billion. 71% of those deals were net new, the company said. In the September quarter, Infosys had won deals worth $7.7 billion. The quarter also saw termination of the MoU with the global client which had a revenue potential of $1.5 billion.

Infosys MD & CEO Salil Parekh did not offer any comment on the deal termination. Brokerage firm Kotak Institutional Equities had projected Infosys to win deals worth $2.5 billion during the quarter.

Parekh further said that there is no difference in client budget and behaviour, adding that there has been no particular increase or decrease in budget.

"The next year is what people will look at, and I think commentary, when the earnings call happens and the press conference happens will be more important, because that will give some highlight on how they are seeing the client budgets to be," Sandip Agarwal of Sowilo Investment Managers told CNBC-TV18.

Infosys also announced the acquisition of InSemi, a leading semiconductor design and embedded services provider for ₹280 crore. Subject to customary closing conditions, the deal is likely to close during the March quarter of financial year 2024.

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