Vishal Sikka-led IT bellwether Infosys will announce its financial results for the first quarter ended June 30, 2016 on July 15.
Vishal Sikka-led IT bellwether Infosys will announce its financial results for the first quarter ended June 30, 2016 on July 15. The top tech firm has been beating street estimates for four consecutive quarters and is expected to continue the momentum marching aggressively towards its vision to achieve $20 billion in revenue by 2020. The company, however, has issued a warning with regards to weaker spending in Q1.
Here are seven things to watch out for in Infosys Q1 results:
Weaker spending: Infosys Chief Operating Officer (COO) U B Pravin Rao recently issued a warning saying that the company would face volatility over the next few quarters, due to weaker spending from sectors such as energy and insurance.
Revenue and margin guidance: FY17 revenue guidance of the company stands at 11.5%-13.5% in constant currency terms and at 11.8-13.8% in dollar terms whereas the margin guidance band is 24-26%. UB Pravin Rao said despite the volatility the company is on track to meet the full-year constant currency revenue guidance. Analysts expect that the company might turn the revenue guidance downwards.
Headwinds and softness: The top IT firm has been experiencing headwinds in verticals such as energy, telecom, and retail, as well as softness in the insurance sector. Rao recently said that Infosys does not expect a recovery in spending from the energy sector before 2017. The company is also facing a slowdown in its enterprise resource planning (ERP) and business process outsourcing (BPO) businesses.
Deal wins: While announcing Q4 FY16 results, the company said that the deal pipeline looks healthy. “We expect to achieve a deal win rate of $1 bn in the next two to three quarters. We would focus on securing a large number of smaller deals,” said CEO Vishal Sikka.
Focus on innovation: Vishal Sikka, addressing the 35th AGM said, “Infosys is moving towards a model based on innovation and the company has laid out a strategy consisting of two parts. The 'Renew' and 'New' strategy has been key for growth.”
Impact of Brexit and currency depreciation: The company experienced a slight drop in revenues from its business in Europe due to currency depreciation in FY16. Brexit may further impact Europe revenues.
Wage hikes: Wage hikes are likely to impact revenues in first quarter of FY17. Vishal Sikka raked in $7.45 million as annual salary for financial year 2015-16. Sikka's new salary structure enabled company's top executives to take home multi-million dollar pay cheques. The company handed out an average wage hike of about 6-12% for all its offshore employees and 2% hike for on-site employees.
Vishal Sikka-led IT bellwether Infosys will announce its financial results for the first quarter ended June 30, 2016 on July 15. The top tech firm has been beating street estimates for four consecutive quarters and is expected to continue the momentum marching aggressively towards its vision to achieve $20 billion in revenue by 2020. The company, however, has issued a warning with regards to weaker spending in Q1.Here are seven things to watch out for in Infosys Q1 results:
Weaker spending: Infosys Chief Operating Officer (COO) U B Pravin Rao recently issued a warning saying that the company would face volatility over the next few quarters, due to weaker spending from sectors such as energy and insurance.
Revenue and margin guidance: FY17 revenue guidance of the company stands at 11.5%-13.5% in constant currency terms and at 11.8-13.8% in dollar terms whereas the margin guidance band is 24-26%. UB Pravin Rao said despite the volatility the company is on track to meet the full-year constant currency revenue guidance. Analysts expect that the company might turn the revenue guidance downwards.
Headwinds and softness: The top IT firm has been experiencing headwinds in verticals such as energy, telecom, and retail, as well as softness in the insurance sector. Rao recently said that Infosys does not expect a recovery in spending from the energy sector before 2017. The company is also facing a slowdown in its enterprise resource planning (ERP) and business process outsourcing (BPO) businesses.
Deal wins: While announcing Q4 FY16 results, the company said that the deal pipeline looks healthy. “We expect to achieve a deal win rate of $1 bn in the next two to three quarters. We would focus on securing a large number of smaller deals,” said CEO Vishal Sikka.
Focus on innovation: Vishal Sikka, addressing the 35th AGM said, “Infosys is moving towards a model based on innovation and the company has laid out a strategy consisting of two parts. The 'Renew' and 'New' strategy has been key for growth.”
Impact of Brexit and currency depreciation: The company experienced a slight drop in revenues from its business in Europe due to currency depreciation in FY16. Brexit may further impact Europe revenues.
Wage hikes: Wage hikes are likely to impact revenues in first quarter of FY17. Vishal Sikka raked in $7.45 million as annual salary for financial year 2015-16. Sikka's new salary structure enabled company's top executives to take home multi-million dollar pay cheques. The company handed out an average wage hike of about 6-12% for all its offshore employees and 2% hike for on-site employees.
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