Wipro profit under pressure as IT growth stays tepid
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CEO says AI-powered strategy is opening larger transformation opportunities
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Wipro profit under pressure as IT growth stays tepid
Bengaluru: IT services firm, Wipro on Thursday reported a net profit of Rs 3,200.6 crore for the second quarter of current financial year, an increase of 1.9 per cent over the same period of last fiscal.
The company’s total income stood at Rs 24,750 crore in Q2 of FY27, which was an increase of 9.1 per cent over the same period a year ago.
Revenue from IT services, which accounts for more than 95 per cent of company’s total income, was at $2.61 billion. This was a sequential decline of 0.1 per cent in constant currency basis.
Deal pipeline of the company during the September quarter fell sharply. Total contract bookings of the Bengaluru-headquartered firm stood at $2.595 billion, a fall of 22.9 percent sequentially in constant currency terms. Similarly, large deal bookings fell 58.6 percent quarter-on-quarter basis to $674 million, compared with $1.626 billion in the previous quarter.
“The strategic investments we have been making are beginning to deliver results. They are enhancing our ability to win in new markets, add new clients, and grow existing relationships. At the same time, our consulting-led, AI-powered strategy is helping us create larger transformation opportunities. We see AI as a long-term growth driver that will expand the addressable market for technology and business transformation. We are already seeing its potential reflected in the momentum across our AI-Native Unit and AI offerings portfolio,” CEO of Wipro, Srini Pallia said.
During the quarter, operating margin of the company improved by 50 basis points sequentially to 16.5 per cent.
“Our operating margin for the quarter was 16.5 per cent, an expansion of 0.5 per cent sequentially. We have delivered this improvement even while continuing to invest in our business and people. Q2 is yet another quarter where our operating cash flow has been robust and stood at 166 per cent of net income,” Aparna Iyer, CFO of Wipro said.
For the third quarter, the company expects its IT services revenue to be in the range of $2.571 billion to $2.625 billion, translating into a sequential growth of minus 1.5 percent to plus 0.5 percent in constant currency terms. During the quarter, total headcount of the company fell sharply to 2,36,328 employees from 2,43,044 in the preceding quarter, a reduction of 6,716 employees.
