Wipro reports a 20.9% dip in Q1 net profit on rising expenses

Don’t see any cut in customer budgets; pipeline is full, visibility good: Thierry Delaporte

Bengaluru

Bengaluru-based tech services and digital transformation provider Wipro reported a 20.9% year-on-year decline in its June ended quarter net profit to ₹2,563 crore.

The firm on Wednesday said rise in expenses, including increasing wages linked to quarterly promotions, a large dividend payout in March and falling interest rates, were the key reasons for the decline in net profit.

Gross revenue for the first quarter grew 17.9% YoY to ₹21,528.6 crore. It’s revenue from IT services, which accounts for some 95% of its total revenue, stood at $2.73 billion, an increase of 2.1% over the preceding quarter.

In his earning commentary, Wipro CEO and MD Thierry Delaporte said despite the uncertainties of the macro-economic environment, the company’s order bookings grew and the overall pipeline was in fact at an all-time high.

“Quality of our pipeline is good and we are confident. We continue to see growth in business. Our interactions with clients are positive and we don’t see a slow down in spending. In fact, we have good visibility for the next quarter, ‘‘ said Mr. Delaporte responding to a query on a possible slowdown in customer markets.

Wipro has closed 18 large deals resulting in a total contract value of $1.1 billion in the first quarter.