Business Today
Loading...

Infosys sees FY16 revenue rising as much as 12 per cent

Bangalore-based Infosys has in recent years struggled to innovate and retain market share due to a staff exodus that impacted its ability to win lucrative deals.

Devidutta Tripathy and Aman Shah    Mumbai     Last Updated: April 24, 2015  | 16:09 IST
Infosys sees FY16 revenue rising as much as 12 per cent
Photo: Reuters

Infosys, India's second-largest software services exporter, said it expects revenue in this financial year to rise as much as 12 per cent, after posting fourth-quarter profit that slightly missed analyst estimates.

Infosys also said it agreed to buy Kallidus and an affiliate, which provide digital services such as mobile commerce for retail clients, for $120 million.

Bangalore-based Infosys, once seen as the bellwether of India's about $150 billion IT services industry, has in recent years struggled to innovate and retain market share due to a staff exodus that impacted its ability to win lucrative deals.

Under Chief Executive Vishal Sikka, the company has been making big bets on automation and other new technology like artificial intelligence and cloud-based services to regain some lost ground from rivals.

For the year ending March 2016, Infosys said it expects revenue growth of 10 per cent to 12 per cent. Revenue grew 6.4 per cent in the last fiscal year to Rs 533.19 billion ($8.39 billion).

Pricing continues to be under pressure due to increasing commoditization in the traditional outsourcing business, requiring the company to ramp up productivity through automation, Chief Operating Officer UB Pravin Rao said in a statement.

Infosys, which provides IT services to clients like Apple, Volkswagen AG and Wal-Mart Stores, also said fourth-quarter net profit reached 30.97 billion rupees, from Rs 29.92 billion a year earlier.

Analysts, on average, were expecting it to make Rs 31.86 billion, according to Thomson Reuters data.

Revenue, two-thirds of which comes from clients in the United States and Europe, rose 4.2 per cent in the quarter to Rs 134.11 billion, as the company added 52 new clients.

Shares of Infosys fell more than 5 per cent after the earnings release.

Last week, bigger rival Tata Consultancy Services posted weak revenue numbers, worrying money managers that the slowdown seen by India's largest software services exporter could be an indicator of an industry-wide trend.

Researcher Gartner earlier this month said worldwide IT spending was set to fall 1.3 per cent from last year to $3.66 trillion in 2015, blaming the slowdown mainly on the rising US dollar.

(Reuters)

Youtube
  • Print

  • COMMENT
BT-Story-Page-B.gif
A    A   A
close