Infosys Q2 revenue up 3.3% year-on-year
BENGALURU, INDIA — Infosys, a leader in digital services and consulting, reported strong financial results for the second quarter ending September 30, 2024.
The company achieved revenues of $4.89 billion, reflecting a sequential growth of 3.1% and a year-on-year increase of 3.3% in constant currency.
The operating margin remained steady at 21.1%, highlighting Infosys’ commitment to financial stability amidst challenging market conditions.
Significant large deal wins and cash flow
The total contract value (TCV) of large deal wins reached $2.4 billion, with 41% being net new deals. This achievement underscores Infosys’ strategic edge in capturing substantial business opportunities.
The quarter’s free cash flow was $839 million, marking a significant 25.2% year-on-year growth, which demonstrates the company’s strong cash generation capabilities.
Leadership insights on performance
Salil Parekh, Infosys CEO and MD, credited the company’s strong quarterly performance to its expertise in financial services and its leading capabilities in cloud and AI technologies.
“The growth was broad-based, with good momentum in financial services. This stems from our strength in industry expertise, market-leading capabilities in cloud with Cobalt, and generative AI with Topaz, resulting in growing client preference to partner with us,” Parekh stated.
“I am grateful to our employees for their unwavering commitment to our client as we further strengthen our market leadership,” the CEO added.
Meanwhile, Infosys CFO Jayesh Sanghrajka emphasized the focus on accelerating revenue growth while maintaining margin performance.
“Operating margins for the quarter was at 21.1%, driven by continued benefits from value-based pricing and utilization despite higher employee payouts. Our focus on cash generation resulted in another quarter of over 100% Free Cash Flow conversion to net profits,” he noted.
Strategic outlook for future growth
With its Q2 results, Infosys revised its revenue growth guidance for FY25 to 3.75% to 4.50% in constant currency while maintaining its operating margin guidance at 20% to 22%.
This outlook reflects the company’s confidence in sustaining growth through strategic investments and operational efficiency.
Enhanced dividend declaration
Infosys’ Board of Directors also declared an interim dividend of ₹21 ($0.25) per share, representing a 16.7% increase from the previous year.
This move reinforces Infosys’ commitment to delivering value to its shareholders.
Resilience and strategic agility
Infosys’ Q2 performance highlights its resilience and strategic agility in navigating complex market dynamics. With ongoing investments in digital transformation and a strong pipeline of large deals, the company is well-positioned to achieve its growth objectives for the fiscal year.
This strong performance underscores Infosys’s leadership in the global IT services sector, which is driven by innovation and client-centric solutions.
