Wipro first quarter results top estimates as Indian IT firm sees some strong client spending
FILE PHOTO: Wipro Ltd logo is seen displayed in this illustration taken, April 10, 2023. REUTERS/Dado Ruvic/Illustration/File Photo
BENGALURU :Wipro beat June-quarter estimates as improved client spending in parts of its Americas business boosted performance and forecast current-quarter revenue in line with expectations.
The results and forecast eased investor concerns after months of subdued outlook, sending U.S.-listed shares of the company up 1.4 per cent in pre-market trading.
India's fourth-largest IT company expects revenue for the September quarter to be in the range of $2.56 billion and $2.61 billion, ranging between a drop of 1 per cent and a rise of 1 per cent, in line with what analysts were expecting.
"The revenue growth forecast gives an indication that uncertainty is reducing, which looks positive overall. Generally, Wipro has not shown positive growth in a weak macro environment," said Sushovon Nayak, IT analyst at Anand Rathi.
India's $283-billion IT sector had hoped a Trump presidency would revive client confidence, but lingering uncertainty over U.S. tariff policies had led to clients keeping discretionary spending on hold.
However, Wipro's revenue in the June quarter rose 0.8 per cent to 221.35 billion rupees ($2.57 billion) and net profit rose 11 per cent to 33.3 billion rupees, both topping analysts' mean estimate of 220.59 billion rupees and 32.55 billion rupees respectively, as per data from LSEG.
Larger peers Tata Consultancy Services and HCLTech missed quarterly revenue estimates, citing continued softness in demand but said the environment has stabilized and not worsened further.
Wipro chief executive Srini Pallia said the quarter started with the company facing "significant macro uncertainty".
Europe saw the steepest revenue decline during the quarter of 8.1 per cent and continues to face headwinds, but Pallia said there was strong deal momentum in the Americas.
Revenue fell in three of Wipro's five segments, even as deal wins rose to $5 billion in the quarter, up from $3.3 billion a year earlier.
($1 = 86.0390 Indian rupees)
