In This Article:
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Revenue Growth: 1.7% quarter-on-quarter and 6.1% year-on-year in constant currency terms.
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Operating Margin: 21.3%, up 20 basis points sequentially and 80 basis points year-on-year.
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Free Cash Flow: $1.26 billion for the quarter, a 90% year-on-year increase.
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Large Deals: Total contract value of $2.5 billion, with 63% being net new deals.
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EPS Growth: 11.4% year-on-year increase to INR16.43.
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Headcount: Increased by over 5,000 to 323,000 employees.
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Attrition Rate: 13.7%.
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Revenue Guidance: Revised to 4.5% to 5% growth in constant currency.
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DSO: 74 days, with net unbilled revenues declining by $323 million sequentially.
Release Date: January 16, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Infosys Ltd (NYSE:INFY) reported a revenue growth of 1.7% quarter-on-quarter and 6.1% year-on-year in constant currency terms.
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The company achieved an all-time high free cash flow of $1.26 billion for the quarter.
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Large deal total contract value (TCV) for the quarter was $2.5 billion, with 63% being net new deals.
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Infosys Ltd (NYSE:INFY) saw double-digit growth in Europe and India, particularly in the manufacturing sector.
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The company is expanding its enterprise AI capabilities with Infosys Topaz, developing over 100 new generative AI agents for clients.
Negative Points
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The automotive sector in Europe continues to remain slow, impacting growth in that region.
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Third-party costs increased significantly, impacting both revenue and costs.
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The top five clients saw a decline in revenue, attributed to furloughs and currency impacts.
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The guidance for Q4 implies a negative growth, primarily due to seasonality and lower working days.
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Utilization rates are above the comfort level, indicating potential inefficiencies or over-reliance on current workforce levels.
Q & A Highlights
Q: Can you comment on any one-time items in your revenues or margins this quarter, and how do you see volume growth into fiscal '26? A: Jayesh Sanghrajka, CFO: Our third-party costs were higher this quarter, impacting both costs and revenue. There were no other one-off items. It's early to predict FY26 volume growth, but we will have more clarity by April when we announce full-year guidance.
Q: The guidance increase is positive, but the implied number for Q4 suggests a negative trend. Is this due to seasonality or third-party sales? A: Jayesh Sanghrajka, CFO: The Q4 guidance reflects seasonality and lower working days. The third-party seasonality, which was significant in Q3, also impacts Q4 guidance.