Wipro

Wipro reported IT services revenue of $2.63 billion for Q3 FY25, reflecting a sequential growth of 0.1% and a year-on-year degrowth of 0.7% in constant currency, slightly exceeding the upper end of their guidance. Operating margins reached a 12-quarter high of 17.5%, expanding by 0.7% quarter-on-quarter and 1.5% year-on-year, even after absorbing two months of incremental wage revision. The company's EPS or net income grew 24% year-on-year and 5% sequentially, supported by margin expansion and better treasury returns.

The quarter saw strong deal momentum with Total Contract Value (TCV) bookings of $3.5 billion, including 17 large deals valued at $1 billion. The Capco business demonstrated improved demand, with its order book growing 9% year-on-year and revenue increasing by 11% year-on-year. Management highlighted a vendor consolidation deal with an American retail company and a technology modernization contract with a Middle Eastern airline as examples of recent wins, both leveraging AI-led solutions.

Americas 1 showed strong growth, up 3.9% sequentially and 3.7% year-on-year, primarily driven by health, technology, and communication sectors. Americas 2 grew 1.2% year-on-year, led by BFSI. However, Europe and APMEA remained soft, degrowing 4.6% and 8% year-on-year respectively. Health maintained momentum with 4.5% YoY growth, and BFSI grew 3.4% YoY despite a sequential degrowth of 1.9% due to furloughs. Energy, Manufacturing, and Resources (EMR) declined 8.7% YoY, while Technology and Communications degrew 5.3% YoY.

Wipro continues to invest heavily in AI, with 50,000 employees now holding advanced AI Certification. The company is leveraging AI tools and platforms across the software development cycle and internal processes, positioning itself as an early adopter of Agentic AI for client impact in areas like customer service and supply chain management. In talent development, the Wipro Leadership Institute is set to train over 600 leaders in FY25 through in-house programs and collaborations with global institutes.

The Board of Directors approved increasing the payout percentage to 70% or above of net income cumulatively over a three-year period, effective FY26, and declared an interim dividend of Rs. 6 per share. For Q4 FY25, Wipro guided for a sequential revenue growth of -1% to +1% in constant currency, translating to $2.602 billion to $2.655 billion. Management expressed confidence in sustaining operating margins in the narrow band around 17.5% for the next quarter.

The hiring engine has 'kicked off,' with plans to hire 10,000 to 12,000 people from campuses in the next fiscal year (FY26), supplemented by lateral hiring. Management noted a positive sign in discretionary spending slowly returning, particularly in the BFSI segment in Americas. While the overall pipeline remains healthy, demand in Europe and APMEA continues to be soft due to challenging economies, leading to cost-trimming by clients in those regions.