Wipro

Wipro reported IT services revenue of $2.6 billion for Q2 FY26, marking a sequential growth of 0.3% in constant currency and 0.7% in reported currency. However, revenue declined by 2.6% year-on-year in constant currency terms. The reported operating margin for the quarter was 16.7%, contracting 60 basis points sequentially and 10 basis points year-on-year, primarily due to a one-off^📎 charge related to a client bankruptcy event. Adjusted for this, the operating margin stood at 17.2%, an expansion of 40 basis points year-on-year.

Americas 1 demonstrated sequential growth of 0.5% and YoY growth of 5%, driven by Healthcare, Technology, and Communication. Europe returned to sequential growth at 1.4%, with the Phoenix deal expected to contribute revenue from Q3. APMEA also showed strong performance with 3.1% sequential and 2.6% YoY growth. In industry sectors, BFSI grew 2.2% sequentially, while Healthcare grew 3.9% YoY despite a sequential decline of 0.2%. Consumer and EMR sectors continued to face headwinds, declining 1.7% and 1.5% sequentially, respectively.

The company closed $4.7 billion in total contract value during the quarter, including 13 large deals and two mega deals in Healthcare and BFSI. These deals are primarily driven by client focus on vendor consolidation, AI-powered transformations, and consulting-led programs. While a significant portion of the mega deals are renewals, they are crucial for deepening Wipro's presence and unlocking future growth in these accounts. Management emphasized a robust pipeline for the second half of the fiscal year, with a focus on converting these into bookings and subsequent revenue.

Wipro introduced 'Wipro Intelligence,' a unified suite of AI-powered platforms and solutions designed to enable clients to scale confidently in an AI-first world. This initiative strengthens Wipro's consulting-led approach, driving innovation and delivering measurable outcomes. The platform incorporates advanced AI capabilities across delivery and industry-specific solutions, with over 200 AI agents and platforms developed. Key solutions like AutoCortex for automotive, WealthAI for BFSI, and Payer AI for Healthcare are already making a tangible difference for clients, with built-in 'responsible AI guardrails' to manage risks like hallucinations and cybersecurity.

Wipro's adjusted operating margin for Q2 was 17.2%, an improvement of 0.4% YoY. Management stated an endeavor to maintain margins within a narrow band of 17% to 17.5%, despite pressures from investments for growth and initial margin dilution from large, competitive deals. Positive factors included rupee depreciation, improved utilization, lower attrition, and better profitability in fixed-price programs. The upcoming Harman DTS acquisition is expected to cause a 60 basis points dilution to margins, which will be managed through ongoing operational initiatives.

For Quarter 3 FY26, Wipro projects sequential IT services revenue growth in constant currency to be in the range of -0.5% to +1.5%, translating to $2.59 billion to $2.64 billion. This guidance does not include any revenue from the Harman Digital Transformation Solutions acquisition, which is expected to close during Q3. Regarding headcount, management noted an increase in net headcount, onboarding of freshers, and improved utilization in Q2. They anticipate continued hiring, both lateral and campus, as strong H1 bookings convert into revenue.