Infosys Q1 net rises 3.2%, expenses surge 29%

Deal pipeline strong, will hire 50,000 freshers this fiscal, says managing director Parekh

Bengaluru-based IT services company Infosys on Sunday ported a 3.2% increase in net profit to ₹5,360 crore for the first quarter ended June.

However, the figures reflected a 5.7% decline sequentially from the previous quarter ended March.

Total revenue rose 23.6% to ₹34,470 crore.

Revenue growth was broad based across verticals with each business growing in double digits and several growing more than 25%, the company said in a statement. Digital business accounted for 61% of overall revenues, growing at 37.5%. However, supply-side challenges, higher travel costs and rising wages dented margins. Overall expenses surged more than 29%, while operating margins for the June quarter came in at 20.1%, down 3.6% year-on-year.

“We reported a strong Q1 amidst an uncertain economic environment,” said CEO and MD Salil Parekh in a virtual media conference. “We continue to gain market share and see a significant pipeline driven by our Cobalt cloud capabilities and differentiated digital value proposition,’‘ he added.

Infosys raised its expectation for revenue growth in the current fiscal year to 14%-16% from the earlier projected 13%-15%, on strong demand outlook.

Infosys saw its large deal signings dropping about 35%, while gross addition of clients during the quarter dropped to 106 from 113 a year earlier.