BENGALURU (Reuters) -Indian IT services provider Wipro Ltd said on Thursday revenue from its mainstay IT Services unit would drop sequentially in the current quarter, after rising expenses offset deal wins in the three months ended March.
Wipro is the latest among major IT services exporters to warn about a drop in future performance as clients in western countries either delay, rethink, or cancel deals.
The company is the only major firm in the industry so far to give an estimate for the quarter; its larger rival Infosys Ltd makes annual projections, and also flagged a weak year ahead.
Net profit for Wipro fell 0.4% to 30.75 billion rupees for the quarter ending March, while revenue rose 11.2%.
Total expenses for Wipro rose 12.4% to 198.18 billion rupees, while operating margin fell to 16.3% from 17% year ago.
Wipro’s subdued results come despite strong deal wins of $4.1 billion, up 29% from a year ago on constant currency basis. This included a large deal of over $1.1 billion, the company said.
Wipro also approved a share buyback of upto 120 billion rupees and said that the promoter group intends to participate in the buyback.
Separately, smaller rival Tech Mahindra on Thursday reported 26% drop in fourth quarter profit as clients cut spending.
Shares of Wipro, which ended mostly flat on Thursday, are down 4.7% year to date after losing 45% last year.
(Reporting by Nallur Sethuraman in Bengaluru; Editing by Nivedita Bhattacharjee)
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