Wipro Q1 results: Profit rises 12% to Rs 2,870 crore; Q2 guidance & more

Wipro on Thursday reported a 11.95 per cent year-on-year (YoY) rise in consolidated net profit at Rs 2,870.1 crore compared with Rs 2,563.60 crore in the same quarter last year. Revenue for the quarter rose 6.04 per cent YoY to Rs 22,831 crore compared with Rs 21,528.60 crore in the corresponding quarter last year. The profit growth fell short of analyst estimates but the revenue figure came in line with expectations.

Wipro said its IT Services segment revenue rose 0.8 per cent YoY to $2,778.5 million. Revenue for the IT Services segment fell 2.8 per cent in constant currency (CC) terms, in line with the earlier guidance. Total order wins for the quarter stood at $3.7 billion. Large deal wins came in at $1.2 billion, up 9 per cent YoY.  IT Services segment's operating margin came in at 16 per cent, up 112 basis points YoY.

Q2 guidance

Wipro has guided for IT Services business segment revenue in the range of $2,722 million to $2,805 million for the ongoing September quarter. This translates to a sequential guidance of minus 2 per cent to 1 per cent in constant currency terms.

“Wipro’s first quarter results come with a strong backbone of large deal bookings, robust client additions, and resilient margins,” said Thierry Delaporte, CEO and Managing Director.

“Despite a gradual reduction in clients’ discretionary spending, we maintained new business momentum. We earned our clients’ trust with strong delivery, innovation, and expanded services that strengthen our long-term businesses, and help capture market share. The launch of Wipro ai360 and the USD 1 billion investment solidifies Wipro’s position as a leading transformation partner that delivers the results and innovation our clients need to future-proof their businesses.”

Chief Financial Officer Jatin Dalal said: “Our ongoing focus on operational improvement has ensured that margin remains steady even in a softening revenue environment. Our operating margin for the first quarter was 16 per cent an expansion of 112 basis point YoY. We generated strong operating cash flows at 130 per cent of our net income for the Quarter. EPS for the quarter grew by 11.5 per cent YoY.”

Operating cash flows stood at 130 per cent of net income for the quarter at Rs 3,750 crore ($457.1 million1). Voluntary attrition continued to moderate sequentially, coming in at an 8-quarter low of 14 per cent.

Among geographies, Americas 2 saw a 3.7 per cent sequential drop in growth, followed by APMEA 2.5 per cent(degrowth), Europe 1.5 per cent and Americas 1 per cent. On YoY basis, Europe was 5.5 per cent growth while Americas 1 registered 1.2 per cent growth.

Among verticals, Energy, Natural Resources and Utilities witnessed 3.6 per cent QoQ growth, followed by BFSI 3.5 per cent QoQ degrowth, Consumer 3.1 per cent QoQ degrowth. Table below:

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