Infosys reported its results for the September quarter of 2026-27 on 23 October, showing a net profit of Rs 7,823 crore, up about 6.2 percent from a year earlier, on revenue of Rs 49,244 crore, up 10.7 percent. The company also lowered its full-year revenue growth guidance in constant currency to 1-2 percent from 1.5-3 percent, while keeping its operating margin guidance of 20-22 percent. Management pointed to macroeconomic uncertainty and softness in North America as the reasons. Revenue in dollar terms was $5,145 million, and the board declared an interim dividend of Rs 26 a share. The numbers arrived at the end of a week in which the IT index had risen ahead of the results, so investors were looking for signs that the sector's weak run is ending.
The argument that this was a respectable quarter rests on profitability, deal flow and artificial intelligence. Profit before tax rose 8.2 percent to Rs 11,063 crore from Rs 10,229 crore, and the operating margin held at 21 percent, in the middle of the guided range. Large deals worth $5.2 billion were signed in the quarter, and 62 percent of that value was net new business, which means it came from fresh work and not renewals. AI revenue grew 29 percent from the previous quarter and now makes up about 10.5 percent of total revenue, a sign that the company is turning the technology into billings. A dividend of Rs 26 a share also shows confidence in cash generation.
The argument that the quarter was weak starts with the gap between the two growth figures. Revenue in rupees rose 10.7 percent, but in constant currency it rose only 1.5 percent from a year earlier and 1.2 percent from the previous quarter, so most of the headline growth comes from the rupee's fall against the dollar and not from more work. Net profit of Rs 7,823 crore was almost flat against Rs 7,769 crore in the previous quarter, a rise of about 0.7 percent. The guidance cut is the clearest signal: a range of 1-2 percent has a midpoint of 1.5 percent, down from 2.25 percent before, and it implies that the company expects very little growth in the remaining two quarters. Wipro, which reported a week earlier, also saw large-deal bookings fall 58.6 percent, so the softness is not limited to one firm.
Infosys matters to India beyond its own shareholders because IT services are one of the country's largest sources of export earnings, white-collar jobs and stock-market weight. A company that guides to 1-2 percent growth is telling the market that clients in North America, its biggest region, are cautious about spending. For the rupee, which has been under pressure from oil and foreign selling, slower IT export growth removes one source of support. For job seekers and the wider economy, the pace of hiring in the sector follows revenue, so a weaker outlook feeds through to campus offers and city rents.
Infosys delivered steady margins and strong deal wins, but its own guidance says growth is close to flat. The next test is whether the AI revenue and the deal pipeline can lift constant-currency growth above the new range in the second half of the year.
Featured image: The Glass Pyramid at the Infosys campus (file photo). Photo: Vinu Thomas from Bangalore, India, CC BY-SA 2.0, via Wikimedia Commons.