Infosys Q3 Results: Profit Meets Estimates, Revenue Guidance Raised

The margin guidance for the fiscal was retained at 20–22%. Revenue growth in constant-currency terms rose 6.1% on a year-on-year basis and 1.7% sequentially. Revenue growth for the first nine months of fiscal 2025 rose 3.9% year on year. 

“The discretionary spending in the US, along with the financial services vertical, has improved in the retail and consumer products vertical as well. Spending in the financial services sector in the UK is also showing signs of improvement,” Chief Executive Officer Salil Parekh said.

However, the automotive vertical in Europe and manufacturing verticals haven't picked up yet, he added. Commenting on the new administration in the US, the CEO noted that the company will wait and see the impact and, at large, is confident about the outlook as clients expect the US economy to do better going forward.

Amid proposals to bring changes to the H1B visa rules, Infosys said that its dependence on H1B visas has reduced significantly. The onsite mix has reduced from 30% range to 24% range, and within its US onsite population, H1 independent employees are over 60%.

The company's free cash flows for the quarter stood at $1.3 billion, higher than $839 million recorded last quarter. 

Besides, the large deal total contract value came in at $2.5 billion, with 41% being net new. This compared with $2.4 billion recorded in the second quarter. The number of active clients stood at 1,876, with six added during the quarter. 

Jayesh Sanghrajka, Chief Financial Officer, Infosys, said, “Margin improvement of 20 basis points was seen in the quarter, of which 40 bps came from currency benefit and 30 bps from Project Maximus. A headwind of 70 bps due to furloughs and other working costs was seen. In the next quarter, headwinds from hikes will be seen and the currency movements are expected to give benefits.

The total employee count at the end of the second quarter is 3,23,379, with an addition of 5,591 employees in the quarter. Attrition inched up to 13.7%, higher than 12.9% recorded in the second quarter. The utilisation rate was flattish at 86%. Infosys remains committed to hiring 15,000 freshers in the current fiscal year and 20,000 freshers in the next fiscal year.

Shares of Infosys closed 1.21% lower at Rs 1,926.20 apiece on the BSE, compared to a 0.42% advance in the benchmark Sensex. The quarterly results were declared after market hours.