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Informist, Thursday, Jul. 17, 2025

 

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--Wipro: Seeing strong deal momentum in the Americas 
--CONTEXT: Comments by Wipro mgmt in post-earnings media concall 
--Wipro: Europe continued to face headwinds in competitive environment 
--Wipro: Discretionary budgets tight, outsourcing renewals creating chances 
--Wipro: AI no longer niche; essential to how cos operate at scale 
--Wipro: Returning to profitable growth is company's priority 
--Wipro: Strong order book, healthy pipeline give us confidence 
--Wipro: Discretionary spend coming back only in certain pockets 
--Wipro: Retail, mfg segments impacted by tariff-related uncertainty 
--Wipro: No strong correlation between AI, hiring so far, it will evolve 
--Wipro: Expect attrition rate to come down as we go forward 
--Wipro: Co's performance expected to get better in Oct-Mar 
--Wipro: Deal pipeline strong, expect growth momentum to continue 
--Wipro: Apr-Jun margin improved due to operational improvements 

 

MUMBAI – Information technology major Wipro Ltd. expects the company's performance to get better in the second half of the financial year 2025-26 (Apr-Mar), supported by a strong order book and healthy deal pipeline, the management said at a post-earnings virtual press conference. In the June quarter, the company had a total deal contract value of $4.97 billion in constant currency terms, up over 24% on quarter.

 

The company expects this growth in deal wins to continue in the future, its management said, adding that it is seeing strong deal momentum in the Americas region. During the June quarter, the company's large deal bookings, in constant currency terms, rose around 50% sequentially to $2.67 billion. It had 16 large deals in the quarter, including two "mega" deals. "...several of these wins were driven by vendor consolidation, where we continue to build strong momentum," said Srini Pallia, chief executive officer and managing director.

 

The company said discretionary spending by clients is returning in certain pockets, not uniformly. The management said clients in the consumer and energy segment and manufacturing and resources segment have been cautious. Within these, retail, consumer packaged goods, and manufacturing clients were affected the most by the US tariff-related macroeconomic uncertainties.

 

Among the geographies from which the company earns revenue, "Europe continued to face headwinds and clients remained focused on maintaining their competitiveness in the uncertain macro-environment," the management said. During the reporting quarter, the company's revenue from Europe fell 6.4% on quarter in constant currency terms. However, the Asia Pacific, West Asia, and Africa region remained resilient for Wipro, supported by its digital spending there. During the quarter, revenue from this region rose nearly 1% sequentially in constant currency terms.

 

Growth in the Americas region was supported by continued momentum in its healthcare business, the Wipro management said. During the reporting quarter, revenue from Americas 1, which includes the entire business of Latin America and select industry sectors in the US, rose marginally on quarter. Revenue from Americas 2, which includes the entire business in Canada and select industry sectors like banking and financial services as well as hi-tech, fell nearly 2% on quarter in constant currency terms.

 

The information technology company's IT services operating margin for the June quarter expanded 80 basis points on year to 17.3%, but fell 20 bps on quarter to 17.3%. Its margin for the quarter was supported by operational improvements, the company said, but cost takeout and vendor consolidation deals continue to weigh on it. Going forward, the company said its focus will be on returning to profitable growth with a continued focus on operational excellence to offset these margin pressures.

 

"Our focus is on using AI (artificial intelligence) and automation to accelerate development, improve quality, reduce costs, and enable agile practices," the management said. "AI is no longer a niche. It is becoming essential to how businesses operate at scale." It expects client spending on AI and data modernisation to continue in a big way. Though the company plans to train employees on AI, it confirmed that there is no correlation between AI and hiring so far.

 

The company expects its attrition rate to fall in the upcoming quarters. However, the management said there are pockets where the company is seeing higher attrition. During the June quarter, Wipro's attrition rate rose to 15.1% from 15% in the previous quarter. "But from our standpoint, we are very comfortable with this kind of a range of attrition going forward," the management said.

 

The company reported its June quarter earnings after market hours. Wipro's consolidated net profit for the quarter stood at INR 33.30 billion on a revenue of INR 221.35 billion. Thursday, shares of Wipro closed at INR 260.60 on the National Stock Exchange, down 0.8%.  End

 

Reported by Arya S. Biju and Anand JC

Edited by Rajeev Pai

 

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