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Infosys Q1 earnings: 5 things to know
Infosys, the second largest IT firm in India, announced the results for the first quarter of FY19 on Friday. After the better than expected numbers from market leader Tata Consultancy Services, there have been great positive expectations from Infosys. Here is everything you need to know about the results.
Earnings snapshot
The company announced a bonus issue of one share for every share (1:1 ratio) held by investors.
P&L: A closer look
While the company registered a 3.70% growth on a year-on-year (YoY) basis, it witnessed a 2.1% decline on a quarterly basis. In addition, the net profits fell short of market estimates of around Rs 3,740 crore for the quarter.
Impact of digital growth
Digital business for the quarter saw revenues of $803 million. This accounted for 28.4% of total revenues for the quarter. The company’s digital business witnessed an 8% growth sequentially during the quarter in constant currency terms. In comparison, it grew by just 3.6% during the March quarter.
Management commentary
The company maintained its revenue guidance for FY19 at 6-8% (in constant currency terms). In case of operating margins, the guidance was retained at 22-24%.
Salil Parekh, the CEO and MD of Infosys said that the strong revenue and margin performance during the quarter shows that the company’s dual emphasis on Agile Digital and AI-driven core services resonated with the company’s clients.
The company also added four more clients in the $100 million category during this quarter.
Stock market reaction
The company’s stock price rose by more than 1% as soon as the market opened on Friday ahead of the Q1 results. At the closing bell too, the stock price was up 2.21% to Rs 1,323.
This upbeat share price movement continued on Monday, with prices rising as much as 3% in the first half of trade.
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