Infosys, Wipro beat Street in Sep quarter, diverge on AI strategy

was pulled up by banks, while revenue from most other verticals declined.

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Banks make up slightly more than a third of Wipro’s business.

This wraps up earnings for India’s five largest IT companies, with the biggest—Tata Consultancy Services— reporting the weakest performance and third-largest, HCL Technologies Ltd, proving to be an outlier.

TCS, HCL Tech and Tech Mahindra Ltd ended the second quarter with revenues of $7.47 billion, $3.64 billion and $1.59 billion, up 0.61%, 2.79% and 1.41% on a sequential basis, respectively.

Three of the Big Five grew revenues in the first half of the fiscal year. The rest didn’t.

Revenue divergence

While revenues at Infosys, HCL Tech and Tech Mahindra grew 4.3%, 5.6% and 0.1% to $10 billion, $7.19 billion and $3.15 billion respectively during the first half, TCS and Wipro saw revenue decline—down 1.9% to $14.89 billion for TCS and 1.8% to $5.19 billion for Wipro.

This raises a warning sign for the two companies, since the first half is traditionally stronger for homegrown IT services firms due to more billing days and fewer holidays.

Infosys and Wipro shares on the New York Stock Exchange were down 2.16% and 0.91% to $16.1 and $2.72, respectively, as of 8:50 pm India time.

For now, the mood at Infosys’s Electronic City campus was one of caution. The environment remains “uncertain”, chief executive Salil Parekh said at a post-earnings press conference.

“What we see today is some changes in where the global environment, the macro is looking. We still see in some of our large markets that there is growth, but there's also some inflation, job creation which is constrained. In some other markets, there are cost constraints. Some industries are seeing that. So, that’s a mix,” Parekh said.