Strong performance with broad based revenue growth in CC of 3.1% sequentially and 3.3% YoY FY25 revenue guidance revised to 3.75%-4.50%; Margin guidance retained at 20%-22%
FinTech BizNews Service
Mumbai, 17 October, 2024: Infosys (NSE, BSE, NYSE: INFY), a global leader in next generation digital services and consulting, delivered broad based growth performance with $4,894 million in Q2 revenues, sequential growth of 3.1% and year on year growth of 3.3% in constant currency. Operating margin for Q2 was at 21.1%. Free cash flow for Q2 was at $839 million, growing 25.2% year on year. TCV of large deal wins was $2.4 billion, 41% being net new. H1 revenues grew at 2.9% year over year in constant currency. Operating margin for H1 was at 21.1%. “We had strong growth of 3.1% quarter-on-quarter in constant current in Q2. The growth was broad based with good momentum in financial services. This stems from our strength in industry expertise, market leading capabilities in cloud with Cobalt and generative AI with Topaz, resulting in growing client preference to partner with us”, said Salil Parekh, CEO and MD. “Our large deals at $2.4 billion in Q2 reflect our differentiated position. I am grateful to our employees for their unwavering commitment to our client as we further strengthen our market leadership” he added.
Guidance for FY25:
• Revenue growth of 3.75%-4.50% in constant currency
• Operating margin of 20%-22% Key highlights: “We continue to focus on accelerating revenue growth with a sharp focus on margin performance. Operating margins for the quarter was at 21.1%, driven by continued benefits from value-based pricing and utilization despite higher employee payouts. Our focus on cash generation resulted in another quarter of over 100% Free Cash Flow conversion to net profits” said Jayesh Sanghrajka, CFO. “The Board announced an interim dividend of `21 per share, 16.7% increase from last year” he added. IFRS – INR Press Release e $2.4 Bn Large Deal TCV 21.1% Operating Margin 3.1% QoQ 3.3% YoY CC Growth 4.7% YoY EPS Increase (Rs terms) $839 Mn Free Cash Flow Strong performance with broad based revenue growth in CC of 3.1% sequentially and 3.3% YoY FY25 revenue guidance revised to 3.75%-4.50%; Margin guidance retained at 20%-22% For the quarter ended September 30, 2024 • Revenues in CC terms grew by 3.3% YoY and 3.1% QoQ • Reported revenues at `40,986 crore, growth of 5.1% YoY • Operating margin at 21.1%, decline of 0.1% YoY and flat QoQ • Basic EPS at `15.71, growth of 4.7% YoY • FCF at `7,010 crore, growth of 26.6% YoY; FCF conversion at 107.6% of net profit For six months ended September 30, 2024 • Revenues in CC terms grew by 2.9% YoY • Reported revenues at `80,300 crore, growth of 4.4% YoY • Operating margin at 21.1%, growth of 0.1% YoY • Basic EPS at `31.09, growth of 5.8% YoY • FCF at `16,165 crore, growth of 43.2% YoY; FCF conversion at 125.4% of net profit.
Client wins & Testimonials
• Infosys announced that it has entered into a long-term collaboration with Metro Bank to enhance some of its IT and support functions, while digitally transforming the bank’s business operations. Daniel Frumkin, Metro Bank Chief Executive Officer, said, “This collaboration with a world class provider like Infosys builds on the solid foundations we have already laid, unleashing our true potential, and creating a sustainably profitable and scalable organization that is fit for the future. At the end of this transformation, we will be a very different business, but the true essence of Metro Bank will remain the same – a high-quality service organization putting customers centre-stage. Metro Bank expects to deliver £80m of annualized cost savings this year across multiple initiatives, as it progresses towards the target of reaching mid to-high teen Return on Tangible Equity by 2027. Our vision for Metro Bank in 2025 and beyond, places our store network firmly at its heart, as we continue with our plans to open new stores and bring the Metro Bank experience to the north of England."
• Infosys announced a strategic collaboration with Proximus to help unlock new business opportunities. Antonietta Mastroianni, Chief Digital & IT Officer at Proximus, said: “We are delighted to strengthen our long-standing collaboration with Infosys. By leveraging Infosys’ global reach and our expertise in CPaaS and DI Solutions, the collaboration will drive innovation and deliver superior customer experiences for our joint customers. We are confident that our mutual deep expertise and proven track record will be instrumental in this two-way partnership."
• Infosys announced its collaboration with TDC Net to help them transform from a traditional infrastructure company to a leading customer-centric technology company. Campbell Fraser, CTIO, TDC Net said, "At TDC Net, we are committed to delivering exceptional value to our customers through a transformation in our IT landscape. Our collaboration with Infosys will enable us to leverage industry-standard processes and platform to create better customer experiences. Infosys' deep expertise in the telecommunications domain, coupled with their proven capabilities in driving end-to-end transformations, gives us confidence in achieving our goals. This collaboration represents a significant milestone in our journey towards becoming a fully digital and customer-centric technology company."
• Infosys announced a strategic collaboration with Polestar to create a base for Polestar’s development of in-car infotainment, Software and Electrical/ Electronics (SW&EE) engineering, user experience (UX), and cloud-powered digital services. Sven Bauer, Head of Software at Polestar, said, “Polestar is starting a new chapter in the company’s global setup with our partner Infosys in Bengaluru. We look forward to building automotive competence in the Polestar Tech Hub to support our growing vehicle portfolio and new model launches.” • Infosys announced a successful collaboration with the Life Insurance Corporation of India (LIC) to spearhead its digital transformation initiative called DIVE. Shri Siddhartha Mohanty, CEO & MD, LIC, said, “Our collaboration with Infosys marks a significant milestone in our digital transformation journey. It will not only enhance our operational capabilities, but also enable us to cater to our vast customer, agent and employee base with newer, more personalized experiences. We are committed to leveraging the latest technologies that Infosys has to offer, including Cloud and Enterprise AI, to drive innovation and improve our offerings.”
Recognitions & Awards
Brand
• Recognized as India’s Best Workplaces™ for Women 2024: Top 50 (Large) for the fourth consecutive year by Great Place to Work® Institute • Recognized as India's Best Workplaces™ in Diversity, Equity, Inclusion & Belonging 2024: Top 25 by Great Place to Work® Institute • Recognized among 'Best Companies for Women in India (BCWI) study, 2024' by Avtar & Seramount, and among 'Best Companies - Hall of Fame' for having featured in the list, six editions in a row • Recognized as the ‘Champion of Inclusion’ in the Most Inclusive Companies Index 2024 by Avtar and Seramount for the fifth year
AI and Cloud Services
• Positioned as a leader in 2024 Gartner Magic Quadrant for Public Cloud IT Transformation Services • Rated as a leader in End-to-End Cloud Infrastructure Management Services NEAT 2024 by NelsonHall • Recognized as a leader in Constellation Shortlist 2024: Artificial Intelligence and Machine Learning Best-of-Breed Platforms • Recognized as a leader in Constellation Shortlist 2024: AI-Driven Cognitive Applications • Recognized as a leader in Constellation Shortlist 2024: AI Services: Global • Recognized as a leader in Constellation Shortlist 2024: Public Cloud Transformation Services: Global Key Digital Services • Recognized as a leader in Global In-house Center (GIC) Setup Capabilities in India - Provider PEAK Matrix® Assessment 2024 by Everest • Recognized as a leader in Digital Transformation Consulting Services PEAK Matrix® Assessment 2024 – North America by Everest • Recognized as a leader in Salesforce Services PEAK Matrix® Assessment 2024 by Everest • Recognized as a leader in Open Banking IT Services PEAK Matrix® Assessment 2024 by Everest
Industry & Solutions
• Rated as a leader in IDC FinTech 2024 Rankings
• Infosys BPM recognized as a leader in the Finance & Accounting Outsourcing (FAO) PEAK Matrix® Assessment 2024 by Everest
• Infosys Finacle positioned as a leader in the IDC MarketScape: Worldwide Cash Management Systems 2024 Vendor Assessment; Worldwide Integrated Bank Payment Systems 2024 Infosys Limited – Press Release Page 4 of 8 IFRS – INR Press Release Vendor Assessment; North America Digital Core Banking Platforms 2024 Vendor Assessment; Europe, Middle East, and Africa Digital Core Banking Platforms 2024 Vendor Assessment; Asia/Pacific Digital Core Banking Platforms 2024 Vendor Assessment
