Infosys Q4 Results: Mixed Performance Sparks Cautious Outlook

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Infosys Q4 Results: Mixed Revenue Growth, Profit Dip, and Cautious 0-3% FY26 Outlook

By S Jha

New Delhi, April 17, 2025: Infosys, India’s second-largest IT services company, announced its Q4 FY25 results today, revealing a mixed financial performance that fell short of market expectations.

The company reported a year-on-year revenue increase but a significant profit decline, prompting a cautious revenue guidance for FY26. Experts on X shared varied analyses, reflecting on the results’ implications for the stock and the broader IT sector.

According to the financial statement, Infosys recorded a Q4 revenue of ₹40,925 crore, up 8% year-on-year from ₹37,923 crore, but missed analyst estimates. Profit after tax (PAT) stood at ₹7,038 crore, down 12% from ₹7,975 crore in the same quarter last year, also falling below projections.

The company announced a final dividend of ₹22 per share and lowered its FY26 revenue growth guidance to a conservative 0-3%, a sharp reduction from the previous 4.5-5%.

@BharatEquator, an X user, tracking market developments, highlighted the shortfall and the conservative outlook, which has stirred investor concerns.

@stockaajorkal provided a detailed breakdown, noting, “Infosys Q4: $ Revenue at $4,730 MN vs estimate of $4,871 MN. CC Revenue down 3.5% vs estimate of -1.1%.” The significant miss in constant currency (CC) revenue growth underscores challenges in the quarter, including a sequential revenue decline.

The company’s CEO, Salil Parekh, acknowledged the challenges, stating, “Our performance reflects resilience in a seasonally weak quarter, with robust operating parameters and margins.”

He emphasized Infosys’ focus on digital offerings and strategic initiatives as key drivers for future growth. However, the lowered guidance signals caution amid macroeconomic uncertainties and reduced client spending in key verticals like BFSI (Banking, Financial Services, and Insurance).

@InvestRepeat expressed concern, stating, “Infosys Q4 Results are out. Revenue up 8% YoY, Profit down 12% YoY. They gave a revenue growth guidance of just 0-3%. Last time they gave such low guidance was Covid Pandemic (0-2%). Dividend declared of ₹22.”

The comparison to the pandemic-era guidance highlights the severity of the current outlook, potentially signaling a tough road ahead for the IT sector.

The company’s operating margin remained stable at 20.1%, slightly down from the previous quarter, reflecting efforts in cost optimization despite pressures from wage hikes and visa costs. Infosys also announced strategic moves, including acquisitions of MRE Consulting and The Missing Link, and a joint venture investment with Mitsubishi, signaling continued investment in growth areas like generative AI and digital transformation.

Analysts on X also noted positive aspects, such as the strong free cash flow of ₹10,647 crore, up 91.9% year-on-year, and a healthy deal pipeline, with large deal wins contributing to a record total contract value (TCV) of $17.7 billion in FY24. However, the cautious guidance and sequential revenue decline overshadow these achievements, raising questions about demand recovery in the IT sector.

The results come amid broader industry challenges, with peers like TCS also reporting subdued growth due to seasonal weaknesses and macroeconomic headwinds. Experts suggest that Infosys’ performance may reflect a broader slowdown in discretionary IT spending, particularly in the U.S. and Europe, where economic uncertainties persist.

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