Top client's AI ventures hurting revenue: Sonata CFO

Sonata Software, a mid-tier information technology (IT) services provider, has said that revenue decline from its top client was worse than anticipated during the fourth quarter of financial year 2024-25 (Q4FY25) as the client looked to automate a sizeable part of the business it used to outsource.

- AVIK DAS

This has caused a huge amount of uncertainty going forward as Sonata is not sure if its customer will look to automate other parts of its outsourced business too, which can further lower its revenue and damage growth prospects.

Sonata's announcement is a first by an Indian IT service provider calling out on revenue loss due to increasing automation efforts taken by a client. Sonata has also said that such efforts pose a threat to small- and mid-sized companies that are often heavily reliant on a few customers for a bulk of their revenue.