Wipro Q3 FY2024 results: A detailed analysis of performance

Wipro Limited, a foremost name in technology services and consulting, disclosed its financial performance for the quarter ending December 31, 2023. Under the International Financial Reporting Standards (IFRS), the results presented a mixed financial picture for the company.

Financial Performance Overview

The company’s gross revenue touched ₹222.1 billion ($2.7 billion), indicating a quarter-over-quarter (QoQ) decrease of 1.4%. This decline was also reflected in the IT services segment revenue, which stood at $2,656.1 million, marking a decrease of 2.1% QoQ. Furthermore, the Non-GAAP constant currency IT Services segment revenue saw a 1.7% decrease QoQ. However, in terms of deal bookings, there was a slight uptick, with total bookings at $3.8 billion, a marginal 0.2% increase QoQ, and large deal bookings were reported at $0.9 billion.

The IT services segment EBIT for the quarter was at ₹35.4 billion ($425.8 million), experiencing a decrease of 1.8% QoQ. The IT services operating margin also saw a downturn, standing at 16.0%, a drop of 11 basis points QoQ. On a positive note, net income for the quarter increased by 1.8% QoQ, reaching ₹26.9 billion ($323.9 million). The earnings per share (EPS) for the quarter also saw a rise, registering at ₹5.16 ($0.061), an increase of 2.0% QoQ. Operating cash flows were robust, standing at 177.3% of Net Income for the quarter, amounting to ₹47.9 billion ($575.7 million).

Management’s Insights

CEO and Managing Director Thierry Delaporte commented on the company’s strategic investments and their returns, particularly in a challenging quarter. He highlighted the company’s strong deal booking momentum and the growth in Consulting, marked by double-digit growth in order bookings in the Capco business. Under Wipro’s ai360 strategy, AI has been embedded across solutions and client offerings, which Delaporte believes will capitalize on emerging opportunities as the macro environment improves.

Aparna C. Iyer, Chief Financial Officer, expressed satisfaction with the company’s execution across all financial metrics – revenue, margin, EPS, and cash flow. She emphasized the building of a more resilient, agile, and efficient organization, which has sustained margins at 16%, despite revenue headwinds.

Strategic Deal Wins

In the third quarter, Wipro continued to secure large and strategic deals across industries, including a notable partnership with a US-based health insurance non-profit and a global technology leader for AI-driven orchestration platform development. Other significant collaborations involved an American Retail Bank, a Middle Eastern financial regulatory body, one of the world’s largest wind turbine manufacturers, and a leading automotive manufacturer’s financial services organization. These partnerships span various sectors, underlining Wipro’s diverse and expanding portfolio.