Infosys on April 13 reported a 7.8 percent YoY rise in its consolidated net profit at Rs 6,128 crore for the quarter ended March 2023. India’s second-largest information technology firm posted a profit of Rs 6,586 crore in the December 2022 quarter.
Consolidated revenue for Q3FY23 came in at Rs 37,441 crore, up 16 percent against Rs 32,276 crore in the corresponding quarter of the previous fiscal. Revenue stood at Rs 38,318 crore in Q3FY23.
The net profit clocked is 6.5 percent lower as compared to the CNBC TV-18 poll estimate of Rs 6,553 crore, whereas, the consolidated revenue is 3.6 percent lower as against the estimate of Rs 38,830 crore.
Operating profit for Infosys came in at Rs 7,877 crore, up 13 percent compared to Rs 6,956 reported in the March 2022 quarter. In the previous quarter, operating profit stood at Rs 8,242 crore. Operating margin contracted 0.5 percent yearly as well as sequentially to 21 percent.
At constant currency, the company's revenue grew by 8.8 percent on-year during the fourth quarter, and by 15.4 percent during the entire fiscal year.
Geographically, the North America region was the key driver of revenue by from clients during Q4, accounting for 61 percent of it. This was followed by 27 percent from Europe, 9.4 percent from rest of the world and 2.6 percent from India.
"Our strong performance in FY23 is a testimony to the continued focus on digital, cloud and automation capabilities which resonated with our clients. We have launched exciting programs with our clients leveraging generative AI platforms” Infosys CEO and MD Salil Parekh said.
“As the environment has changed, we see strong interest from our clients for efficiency, cost and consolidation opportunities, resulting in a strong
large deal pipeline. We have expanded our internal program on efficiency and cost to build a path to higher margins in the medium term. We continue to invest in our people and in supporting our clients, Parekh added.
The company's attrition rate during the fourth quarter dropped to 20.9 percent, as compared to 24.3 percent in Q3 FY23. The total employee count as of March 31 stood at 3,43,234, marking a drop of 3,611 employees as compared to the previous quarter.
The total value of large deals closed in Q4 FY23 stood at $2.1 billion, whereas, for the entire fiscal it stood at $9.8 billion.
Infosys also informed the stock exchanges that its board has recommended a final dividend of Rs 17.50 per equity share for the fiscal year. With this, the total dividend for FY23 will amount to Rs 34 per share, which is 9.7 percent higher than the total dividend announced in FY22.
"Our continued focus on cost optimization and operational efficiencies have helped in achieving operating margins of 21 percent in FY23. Free cash generation in Q4, led by robust collections, was strong. Executing on our capital allocation policy, we successfully completed the share buyback and have proposed a final dividend of Rs 17.50 for FY23," Infosys Chief Financial Officer Nilanjan Roy said.
A day earlier, IT sector bellwether TCS also disappointed with lower-than-expected numbers for the last quarter of FY23. TCS reported a 14.8 percent year-on-year (YoY) increase in consolidated net profit at Rs 11,392 crore for the quarter ended March 31, 2023. Its consolidated revenue from operations came in at Rs 59,162 crore, up 16.9 percent, from Rs 50,591 crore in the year-ago quarter.
The company saw its EBIT (earnings before interest and taxes) margin contracting 0.5 percent YoY to 24.5 percent vs 0.1 percent expansion expected while EBIT increased 14.7 percent to Rs 14,488 crore for the quarter.