Infosys cut its revenue guidance to 10.5-12% in constant currency terms for 2016-17 from 11.5-13.5% estimated earlier. This led to a massive 10% drop in its share price on Friday’s opening bell trading in the stock market.
The company today said its first quarter revenue grew by 2.2% quarter on quarter in US dollar terms and 1.7% on constant currency terms. This is nearly half of what the market had expected.
Infosys’ chief executive Vishal Sikka said, “We had unanticipated headwinds in discretionary spending in consulting services and package implementations as well as slower project ramp-ups in large deals that we had won in earlier quarters, resulting in a lower than expected growth in Q1.”
Revenue in rupee terms for the first quarter grew by 16.9% to Rs 16,782 crore and operating profits grew by 17.4% to Rs 4,047 crore, as compared to the first quarter last fiscal. Net profit for the year grew by 13.4% to Rs Rs 3,436 crore.