In a quarter where most Indian IT giants have reported flat or declining performance, Infosys has managed to shine albeit modestly by showing sequential growth in revenue and posting stronger deal wins. The company’s performance in the June 2025 quarter has sparked a glimmer of hope for an otherwise struggling IT sector grappling with global headwinds, especially uncertainty in the US market.

Infosys posted a quarter-on-quarter revenue growth of 2.6 percent on a constant currency basis, with its total revenue for the June quarter standing at ₹42,279 crore. This is notable when compared to peers such as Wipro and HCL Tech, both of which reported a decline in constant currency revenues during the same period. Wipro reported a 2 percent decline, while HCL Tech’s revenue slipped by 0.8 percent.

However, not everything was positive. Infosys’ operating margin fell by nearly 60 basis points to 23.5 percent, reflecting the pressure of higher costs. Wipro and HCL Tech also saw similar erosions in profitability, with margins falling to 19.4 and 19.9 percent respectively. Rising operating expenses across the sector are impacting the ability of companies to maintain margin stability, even when revenue growth appears steady.

Infosys’ net profit for the quarter stood at ₹6,924 crore, marking a marginal 1.6 percent decline from the previous quarter. While this may seem discouraging at first glance, it is far less severe than the drops seen at its rivals. Wipro’s profit declined by 7 percent, and HCL Tech’s profit fell by more than 10 percent.

A key highlight in Infosys’ performance was its strong deal momentum. The company reported a large deal total contract value of $3.8 billion, significantly higher than the $2.6 billion reported in the March quarter. This reflects client confidence and robust business development, even in a cautious global environment.

Encouragingly, Infosys also revised its revenue growth guidance slightly upward. It now expects growth in the range of 1 to 3 percent for the full year on a constant currency basis, up from its earlier estimate of 0 to 3 percent. While the increase is modest, it signals management’s confidence in navigating through global uncertainties. In comparison, HCL Tech expects revenue growth between 3 and 5 percent, while Wipro offered a more conservative guidance ranging between a slight contraction and modest growth.

Stock market sentiment remains cautious. Infosys shares ended the day 0.9 percent lower at ₹1,556, though the stock has moved up from its 52-week low of ₹1,307 recorded in April. Wipro’s stock has also recovered from a 52-week low of ₹225 to end at ₹260.8. These movements suggest that while investor faith has not been fully restored, there is recognition of resilience in companies like Infosys.

Broader concerns about the US economy continue to weigh on the sector. With the Trump administration pushing forward with new tariffs and an aggressive economic stance, IT spending among US clients remains subdued. This has led investors to take a wait-and-watch approach toward Indian IT stocks. The sector, long seen as a reliable compounder, is now facing structural challenges that may take several quarters to resolve.

Infosys currently trades at a price-to-earnings multiple of about 23 times estimated FY26 earnings, slightly higher than Wipro’s valuation multiple of 20 times. While this may indicate a premium on Infosys’ relative performance, it also reflects the market’s cautious optimism.

In summary, while Infosys has not delivered a blowout quarter, its performance offers signs of stability in an otherwise uncertain landscape. Improved deal wins, moderate revenue growth, and an upward revision in guidance suggest that the company is better positioned than some of its peers. However, with global demand still in flux, investors are likely to tread carefully.

 

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