Q3 Results: TCS and Infosys outperforms, Wipro misses street estimates

India’s largest IT Services providers, TCS, Infosys, and Wipro, announced their Q3 financial results on Wednesday, reporting strong revenue numbers for the seasonally weak quarter.

The third quarter ended December 2021 is considered weak for IT firms due to lesser working days in their key markets, the US and Europe.

TCS and Infosys beat the street estimates on growth, while Wipro fell short of expectations after delivering consistent performance in the last few quarters.

However, the performance of India’s top three IT companies indicated that growth momentum is strong in a traditionally soft quarter. Mainly, growth is being driven by digital transformation and cloud adoption.

TCS Q3 Results

Mumbai-based TCS’s revenue surged 16.3 percent at Rs. 488.8 billion, while net profit at Rs. 97.6 billion, a growth of 12.2 percent as the company notched double-digit growth from services provided financial services, retail, manufacturing, and life science businesses.

The company also announced Rs. 18000 crore share buyback program at Rs. 4500 per share, a premium of 16.6 percent on Wednesday’s price.

TCS also crossed a key milestone of 25 billion USD on annual revenue for the year ended December 2021.

The company also announced promotions for its 1.1 lakh employees during the earnings call.

It reported a TCV (Total Contract Value) of 7.6 billion USD.

“Our continued growth momentum is a validation of our collaborative, inside-out approach to our client’s business transformation needs,” said CEO Rajesh Gopinathan.

Infosys Q3 Results

Infosys reported its profit at Rs. 5809 crore on the back of revenue growth of nearly 30 percent at Rs. 31867 crore. It raised revenue growth guidance for the year ending March 2022 by up 2.5 to 3 percentage points to 19.5-20 percent, boosted by its winning large deals worth more than 50 million USD.

It won 25 deals during the quarter, and the total contract value is 2.53 billion USD.

Salil Parikh, CEO of Infosys, said, “We expect the healthy technology spend to continue with large enterprises progressing on their digital transformations.”

Wipro Q3 Results

Wipro reported a net profit on an annual basis at Rs. 2969 crore, and revenue grew at Rs. 20313 crore, up 27.5 percent on broad-based growth.

While reported sequential growth was 2.3 percent for the IT segment, the company posted a 3 percent growth on a constant currency basis.

Wipro added seven new customers for more than 100 million USD revenue league in 12 months. It reported TCV at 2.85 billion USD.

“Wipro has delivered a fifth straight quarter of robust performance on revenues and margins,” said CEO Thierry Delaporte.

The biggest concern that all three continued to exhibit in the quarter was high attrition. But these companies said they had witnessed attrition coming down on a quarterly basis.

The management of these three companies indicated that supply-side pressure is a trend across the IT sector and is likely to ease in the current fourth quarter.