Infosys delivers stellar $4.7bn in Q2 FY24 revenues, marks 2.5% YoY growth

In a noteworthy achievement, global digital services leader Infosys recorded a whopping $4,718 million in Q2 revenues. This achievement for the quarter ended September 30, 2023 reflects a consistent year-on-year growth of 2.5% and a sequential uptick of 2.3% in constant currency. Infosys’s stronghold on the market further solidifies with its massive large deal Total Contract Value (TCV) for the quarter, touching the $7.7 billion mark.

Unprecedented 48% Net New in Large Deals; Operating Margin Surges to 21.2%

Infosys has showcased its unparalleled market relevance by securing 48% net new in large deals this quarter. An increment in operating margin is also on the cards, witnessing a surge of 40 bps sequentially, and reaching 21.2%. A decline in attrition rates further bolsters Infosys’s position, with a notable decrease to 14.6%.

Salil Parekh Lauds Infosys’s Q2 Performance Amid Uncertainties

Salil Parekh, the esteemed CEO and MD of Infosys, has heaped praises on the company’s Q2 performance. Emphasizing Infosys’s adaptability, he mentioned, “This, in an uncertain macro-environment, is a testament to our ability to pivot and stay relevant.” He further accentuated the robust adoption of Infosys’s Generative AI offering, Topaz, which is playing a pivotal role in amplifying market share and delivering unparalleled value.

Infosys Q2 earnings soar: Highest large deals and boosted revenue highlights. Photo courtesy of Infosys Limited.

Infosys Q2 Snapshot: Revealing the Numbers

For the quarter ending September 30, 2023, Infosys’s revenues in constant currency terms saw a rise of 2.5% YoY and 2.3% QoQ. The reported revenues stood at ₹38,994 crore, marking a growth of 6.7% YoY. While the operating margin faced a slight decline of 0.3% YoY, it bounced back with an increase of 0.4% QoQ. Infosys’s FCF touched ₹5,536 crore, exhibiting a growth of 16.5% YoY.

Six-months Overview Reveals Strong Financial Backbone

Infosys’s financial strength remains unwavering for the six months ending September 30, 2023. With revenues in constant currency terms growing by 3.3% YoY and reported revenues reaching ₹76,927 crore, the company showcased an 8.3% YoY growth. The operating margin and Basic EPS too followed suit, with a growth of 0.2% YoY and 8.3% YoY, respectively.

Nilanjan Roy Highlights Q2 Operational Efficiencies and Dividend Boost

Infosys’s CFO, Nilanjan Roy, pointed out the Q2 operating margin of 21.2% as an early indicator of the newly introduced margin improvement plan’s success. “It’s a clear reflection of our ability to continuously identify opportunities for improving operational efficiencies,” said Roy. Aligning with the company’s capital allocation strategy, a commendable interim dividend of ₹18 per share has been announced, marking a 9.1% increase from the previous year.

FY24 Guidance: A Promising Outlook for Infosys

As we look forward, Infosys is poised for continued success with its FY24 revenue growth guidance set between 1.0%-2.5%. The operating margin guidance remains steady, ranging from 20.0% to 22.0%.