Another tough quarter for Mphasis

Unlike its much larger peers, Mphasis, the India-based SI majority-owned by HP, continues to march steadily backwards. Q1 revenues (to 31^st Jan.) fell by 9% to $271m on a sequential basis, while operating margins lost 3 points to 18.0%, the third quarter of successive margin decline. The trend is line with parent HP’s poor services performance in the same quarter (see Ugly quarter for HP growth), where services revenues went backwards as did margins, which compressed by 40bps qoq to 16.0%. It sounds like HP’s services wheels are getting a bit wobbly. Can Leo find the right tools to tighten the nuts?