Indian IT companies like Infosys, Wipro, HCLTech, and others have released the financials for the September ended quarter. Despite major deal wins, the IT majors have cut their growth guidance for the upcoming quarters
Five out of seven Indian IT companies that have reported their Q2FY24 results have revised their guidance downward, reflecting a challenging demand environment and sputtering growth in the industry
Infosys lowered its revenue guidance to 1-2.5%, citing delays in large program kick-offs and extended deal closures. CEO Salil Parekh mentioned that discretionary spending was decreasing, and transformation programs were progressing slowly. Seasonal weakness in Q3 and Q4 also played a role
HCLTech reduced its FY24 revenue growth guidance from 6-8% to 4-5%. CEO C Vijayakumar explained that a weak performance in the first half necessitated strong sequential growth to meet the higher guidance, which wasn't achieved. Momentum and large deals are expected to drive growth in Q3 and Q4
Wipro has lowered its sequential guidance to -3.5 % to -1.5 % from -2 % to 1 % last quarter. Another interesting trend at Wipro was the reduction in the company’s customer base. Client additions dropped sequentially, from 65 in Q1 to 49 in Q2
L&T Tech Services lowered its guidance to 17.5-18.5% from 20%. CEO Amit Chadha cited long decision cycles and macroeconomic stress as short-term headwinds, despite strong longer-term trends in engineering and R&D
Happiest Minds halved its guidance from 25% to 12%. CFO Venkatraman Narayanan mentioned delays in acquisitions and reevaluating guidance. The new guidance is solely organic growth, reflecting challenges in inorganic expansion
Despite big deal wins in Q2 FY24, major Indian IT companies have revised their guidance in anticipation for future rampdowns and cutbacks on discretionary spending
As IT companies adjust their guidance downward in response to industry challenges, they navigate uncertainty in a demanding environment. The ability to adapt and regain momentum will be critical in the coming quarters