Wipro reports marginal decline in Q2 FY24 net profit, revenue
In the second quarter of FY24, Wipro also reduced its employee headcount by 5,051 to end at 244,707.
Wipro, India’s fourth largest IT services exporter, posted a marginal decline in net profit and revenue for the second quarter of FY24, impacted by the slowdown in the business environment.
The IT company reported a net profit of Rs 2,649.1 crore for the second quarter of FY24—a decline of 0.5% compared to the same quarter last year. Consolidated revenue during this period dipped 0.1% YoY to touch Rs 2,25,159 crore.
Wipro's second-quarter performance was below analyst expectations of a 1% growth in revenue.
Its mainstay IT business registered a revenue of $2.71 billion—a 2.3% decline compared to the first quarter. Additionally to this below-par performance, Wipro provided a lowered revenue guidance for the third quarter of FY24. It projected revenue growth in the range of -3.5% to -1.5%.
Wipro CEO Thierry Delaporte attributed this subdued performance to lower spending on technology services by clients and their unwillingness to take up any new projects given the uncertain macroeconomic environment.
Wipro's performance is almost on similar lines to what its peers Tata Consultancy Services (TCS), Infosys, and HCLTech reported for the second quarter. The mood is that the present environment is likely to persist for more time at least till the end of this fiscal.
At the same time, Wipro said it had total order bookings of $3.8 billion and large deals total contract value of $1.3 billion. This parameter indicates that the future looks positive, although there is no certainty on how many deals will convert into actual revenue.
For the second quarter, Wipro increased its operating margins by 10 basis points to 16.1%, a positive for the company.
Wipro CFO Aparna Iyer said, “We remain focused on profitable growth despite a challenging market. Our disciplined approach to improving efficiency, productivity, and utilisation has led to an increase of 100 bps YoY in our IT services operating margins.”
In the second quarter, Wipro also reduced its employee headcount by 5,051 to end at 244,707. The company has witnessed a steady decline in its total headcount over the last year, where it has let go of nearly 17,000 people.
Edited by Suman Singh
