Infosys profit jumps, raises revenue view on digital boom

Software services giant Infosys Ltd raised its annual revenue forecast on Wednesday and posted a jump in quarterly profit, as it won more contracts from global businesses expanding their digital offerings during the pandemic. Infosys and rivals Tata Consultancy Services Ltd and Wipro Ltd have benefited from rising demand for outsourcers as companies boost investments in services ranging from cloud computing to digital payment infrastructure.

There is a strong pipeline of deals, including work in the cloud, data and analytics areas, Infosys Chief Executive Officer Salil Parekh said on a conference call. The company, India's second-largest IT services firm by market value, said it expects revenue growth of 14% to 16% for the financial year to March 2022, compared with the 12% to 14% growth predicted in April.

Bengaluru-based Infosys also maintained its margin forecast for fiscal 2022 at 22% to 24%. Deal flows were strong in the first quarter ended June 30, with total contract value rising to $2.6 billion, from $1.74 billion a year earlier.

Revenue from operations climbed 17.9% to a record 278.96 billion rupees, spurred by a 47% jump in the digital business that accounted for more than half of the total revenue.

Consolidated net profit climbed 22.7% from a year earlier to 51.95 billion rupees, but missed an average estimate of 53.34 billion rupees from analysts, according to Refinitiv IBES data. Last week, bigger rival TCS reported a 29% rise in quarterly profit and said it expected double-digit revenue growth for the year.