Earnings Results: Infosys stock dives after another profit miss and lowered full-year revenue outlook

by | Jul 20, 2023 | Stock Market

The U.S.-listed shares of Infosys Ltd. sank Thursday, after the India-based information-technology consultant missed profit expectations for a second-straight quarter, and cut its full-year revenue growth outlook. The company
said it launched a “margin expansion” program, aimed at boosting its generative artificial intelligence (AI) and automation businesses and cutting indirect costs.

Chief Executive Salil Parekh said on the post-earnings conference call with analysts that he feels “confident” about the longer-term outlook, given a strong pipeline of large deals as the company’s Generative AI platform is resonating well with clients. “In the short-term, we see some clients stopping or slowing down work on transformation programs and discretionary work,” Parekh said, according to a FactSet transcript. Net income for the fiscal first quarter to June 30 rose to $724 million, or 17 cents a share, from $689 million, or 16 cents a share, in the year-ago period. That missed the FactSet to miss the FactSet consensus for earnings per share of 18 cents. Revenue grew 3.9% to $4.62 billion, which was above the FactSet consensus of $4.59 billion. The stock sank 9.1% in afternoon trading. That put it on track for the biggest one-day selloff since April 13, when it tumbled 9.8% after the company missed profit and revenue expectations. For fiscal 2024, the company said it now expects revenue growth of 1.0% to 3.5% in constant currency, compared with previous growth guidance of 4% to 7%. “This is due to lower than expected volumes due …

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