FY24 Guidance: Infosys Revises CC Revenue Growth Target To 1.5-2%; Operating Margins Outlook Unchanged

Despite reporting a bleaker third quarter, tech giant Infosys has revised its FY24 guidance. The company raised its lower-end of FY24 guidance for revenue growth in constant currency, but trimmed its upper-end. Meanwhile, Infosys maintained its operating margin guidance.

As per the regulatory filing, Infosys revised FY24 revenue guidance is in the growth rate of 1.5%-2.0% in constant currency. Earlier, the revenue growth was expected at the lower end of 1%, and upper end of 2.5%.

Meanwhile, Infosys maintained its operation margin guidance of 20%-22%.

Infosys said it delivered $4,663 million in Q3 revenues with year-on-year and sequential decline of 1.0% in constant currency. Large deal TCV for the quarter was $3.2 billion, with 71% being net new. Operating margin for the quarter was 20.5%, a sequential decline of 70 bps. Attrition declined further to 12.9%. FY24 revenue guidance revised to 1.5%-2.0% and operating margin guidance at 20%-22%.

Meanwhile, Infosys reported a consolidated net profit of Rs 6,106 crore in the third quarter of FY24, which declined by 7.3 % year-on-year and 1.7% quarter-on-quarter. Also, consolidated revenue came in at Rs 38,821 crore in Q4FY24, registering a marginal growth of 1.3% YoY but slipped -0.4% QoQ.

In the nine months period of FY24, Infosys revenue in constant currency grew by 1.8% YoY. While in Indian rupees, the company's revenue stood at Rs 115,748 crore, registering a growth of 5.9% YoY.

Further, in 9M FY24, Infosys posted operating margin at 20.8%, which has dipped slightly by 0.2% year-on-year. Basic EPS at Rs 44.13, growth of 3.0% YoY.

The company's free cash flow ws at Rs 16,833 crore, growth of 15.3% YoY. Notably, FCF conversion at 92.1% of net profit.

Net profit for 9MFY24 stood at Rs 18,264 crore, up by 1.7% from Rs 17,967 crore in the corresponding period of the previous year.

Salil Parekh, CEO and MD believes their clients are leveraging its Topaz generative AI capabilities and its Cobalt cloud capabilities to create long-term value for their businesses.

Infosys Topaz is an AI-first set of services, solutions and platforms using generative AI technologies. It helps amplify the potential of humans, enterprises and communities to create value from unprecedented innovations, pervasive efficiencies and connected ecosystems. It brings the advantage of 12,000+ AI assets, 150+ pre-trained AI models, 10+ AI platforms steered by AI-first specialists and data strategists, and a 'responsible by design' approach that is uncompromising on ethics, trust, privacy, security and regulatory compliance.

While Infosys Cobalt is a set of services, solutions and platforms for enterprises to accelerate their cloud journey. It offers 35,000 cloud assets and over 300 industry cloud solution blueprints.

On BSE, Infosys share price ended at Rs 1,495 apiece, down by 1.62% with market cap of Rs 6,20,491.91 crore. Infosys shares will react to Q3 numbers tomorrow.