Infosys gives up quarterly guidance in wake of horror Q1

For the first time that I can remember in my several years of tracking the company, second-ranked Indian offshore services player, Infosys, failed to give a forecast for the following quarter’s revenues and earnings after missing its Q1 revenue target by a wide margin. Management also downgraded its forecast for FY growth once again, from some 9% to just 5%, less than a half of industry association Nasscom’s 11-14% predictions for Indian offshore services growth.

Infosys’ Q1 revenues (to 30^th June) grew by less than 5% yoy to $1.75b, 1% lower than the prior quarter and the second consecutive qoq decline. However, the weak Rupee turned this into nearly 29% growth yoy in Indian currency. Operating margins were nearly 2 points higher yoy, at 27.9%, though down nearly 2 points on the prior quarter. Infosys’ shares are down 8% in Mumbai.

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