Infosys, the country’s second largest software exporter, on Thursday released earnings for the fourth quarter ended March 31, 2023, which missed Street expectations on both top-and bottom-line metrics. The IT heavyweight has also declared a final dividend of ₹17.50 per equity share for the financial year 2022-2023 (FY23), while it forecasted slower revenue growth for the fiscal year ending March 2024. Ahead of Q4 earnings report, the shares of Infosys ended the day’s trade at ₹1,388.60, down 2.79% at the BSE.
The Bengaluru-headquartered company has reported 7.8% year-on-year (YoY) rise in consolidated net profit at ₹6,128 crore for the March quarter compared with ₹5,686 crore in the same quarter last year. On the quarter-on-quarter (QoQ) basis, the profit de-grew by 7% from ₹6,586 crore in the December quarter of 2022.
Consolidated revenue from operations jumped 16% to ₹37,441 crore in Q4FY23, as against ₹32,276 crore in the corresponding quarter last fiscal. Sequentially, the revenue dropped by 2.3% from ₹38,318 crore in Q3FY23.
Dollar revenue for the quarter stood at $4,554 million, up 6.4% from $4,280 million in Q4FY22. Sequentially, dollar revenue declined 2.2% from $4,659 million in Q3FY23. In constant currency (CC) terms, revenue grew by 8.8% YoY and dropped by 3.2% QoQ. Digital revenues accounted for 62.9% of total revenues.
The operating profit for the company was at Rs 7,877 crore, up 13.2% as compared to ₹6,956 reported in the March 2022 quarter. Sequentially, it fell 4.4% from ₹8,242 crore in Q3FY23. The operating margin contracted 0.6% YoY and 0.5% QoQ to 21%.
“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” said Salil Parekh, CEO and MD.
“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," he added.
Segment wise, revenue from the financial services sector, which contributes to 29% of the total revenue, declined 1.7% YoY. The revenue from the manufacturing vertical, which accounts to 13.5% of total revenue, was the best performer with a 22% YoY growth, followed by energy, utilities, resources & services, which posted a growth of 14.3%. While the revenue from retail business grew 10% YoY, the communication segment reported a decline of 2.1% YoY.
During the quarter under review, the company won orders worth $2.1 billion, taking its FY23 order wins to $9.8 billion.
The board of the company has also declared a dividend of ₹17.50 per share for the fiscal year FY23. It fixed June 2 as the record date to determine eligible shareholders for the dividend benefits, while the dividend will be paid on July 3, 2023.
As of March 31, 2023, Infosys' headcount stood at 3,43,234, with a net addition of 29,219 employees in FY23, down 46% from last year’s net addition of 54,396.
Going forward, Infosys Infosys expects revenue growth in CC terms at 4-7% for FY24. The EBIT margin for the fiscal has been projected to grow at 20-22%.
