Macro Headwinds Cloud IT Firms' Growth Outlook

As the curtains draw on the current financial year, Indian information technology (IT) firms remain cautious, with expectations of a soft fourth quarter, driven by lower discretionary spending and ongoing macroeconomic uncertainties.

- AVIK DAS

Concerns over recovery in FY26 persist, with rising risks stemming from tariff wars and inflation.

Analysts reckon that the final quarter of FY25 (January-March) may see improved client demand, particularly in the financial services sector.

However, the recent commentary from Accenture, after its Q2 results, has raised concerns about growth prospects for FY26.

Many believe that heightened global macroeconomic uncertainty, particularly the impact of tariffs on the US economy, is still clouding the outlook.

Accenture said last week discretionary spending has picked up in financial services and the US. That could bode well for TCS, Infosys, and Wipro among others, where banking, financial services, and insurance (BFSI) business contributed between 25 and 40 per cent to the top line annually.

Growth rates in FY25 and FY24 are about 4.3 per cent and 2 percent respectively, according to IT industry body Nasscom.