Mumbai, July 14: Infosys today beat Street expectations as new services and strong execution saw the company reporting a 1.3 per cent rise in first-quarter net profit while raising the annual revenue guidance in US dollar terms.
Net profit of the country's second largest IT services firm during the April-June quarter came in at Rs 3,483 crore - slightly ahead of analyst estimates - compared with Rs 3,436 crore a year ago.
Revenues were also higher than expectations as they came in at Rs 17,078 crore, a growth of 1.8 per cent over last year and a decline of 0.2 per cent on a sequential basis. Analysts were expecting the firm to post revenues of around Rs 16,800 crore.
Infosys, which has undertaken a major transformation under CEO Vishal Sikka, also raised its US dollar revenue growth guidance for the year to 7.1-9.1 per cent, from the previously projected 6.1-8.1 per cent.
However, it maintained its constant currency revenue guidance at 6.5-8.5 per cent. Sikka told reporters at a press conference that the firm may have a relook at this guidance during the second quarter of this year.
The company, which had been in the news for a spat between its board and high-profile founders over corporate governance, has been focussing on new services such as cloud ecosystem and big data analytics apart from bringing in fresh software offerings such as artificial intelligence platform Nia.
The Bangalore-based company has also been battling other challenges such as tougher visa norms in the US and the appreciation of the rupee, which partially affected margins during the first quarter.
The results came after larger peer Tata Consultancy Services announced disappointing numbers yesterday.
The Infosys stock gained over 3 per cent in intra-day trades once the results were declared, but surrendered all of it to end marginally in the red at Rs 972.05 - a drop of 0.44 per cent.
Sikka, who arrived for the media briefing at the company's headquarters in an autonomous (driverless) vehicle built by Infosys engineers, said the strong focus on execution during the last quarter had yielded positive returns.
The utilisation, without freshers, at 84 per cent was the highest in 15 years. Including freshers, the utilisation was 80.2 per cent, the highest ever. Further, for six quarters in a row, Infosys has managed to improve its revenue per employee, which now stands a tad below $52,000.
During the first quarter, new services contributed 8.3 per cent to Infosys's revenues. The new software (Nia, Panaya and others) generated close to 1.6 per cent of its topline.
Sikka said Infosys will hire 10,000 jobs in the US in the next two years and it will also recruit a similar number of people in India in less than two quarters.
He added that the hiring plans in the US would not have any impact on India. The company had rolled out campus offers to 19,000 people, he said.
