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Infosys — Q4 FY26
Infosys reported Q4 FY26 revenue growth of 4.1% YoY in constant currency, with full-year growth of 3.1%.
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Infosys reported Q4 FY26 revenue growth of 4.1% YoY in constant currency, with full-year growth of 3.1%. Large deal TCV reached $15 billion for FY26, up 24% YoY, with Q4 at $3.2 billion. Operating margin was 20.9%, down 30bps sequentially due to acquisition amortization and compensation costs, partly offset by currency and Project Maximus benefits. Management guided FY27 revenue growth of 1.5%-3.5% CC and operating margin of 20%-22%, citing AI services momentum but also headwinds from a European manufacturing client ramp-down and onsite mix shift. Key risks include competitive intensity driving productivity pass-throughs and macro uncertainty delaying discretionary spending.
इन्फोसिस ने चौथी तिमाही में कमाई 4.1% बढ़ाई, पूरे साल 3.1% बढ़ोतरी हुई। बड़े सौदों का मूल्य 15 अरब डॉलर रहा, जो पिछले साल से 24% ज्यादा है। मुनाफा 20.9% रहा, जो पिछली तिमाही से थोड़ा कम है, क्योंकि कंपनी ने नई कंपनियां खरीदने और कर्मचारियों को भुगतान पर ज्यादा खर्च किया। अगले साल कमाई 1.5% से 3.5% तक बढ़ने का अनुमान है, और मुनाफा 20% से 22% के बीच रहेगा। एआई सेवाओं से मदद मिलेगी, लेकिन यूरोप में एक ग्राहक के काम कम करने और ऑनसाइट काम बढ़ने से चुनौती होगी। मुकाबला बढ़ने से कीमतें कम हो सकती हैं और आर्थिक अनिश्चितता से खर्च में देरी हो सकती है।
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Productivity Pass-Throughs from AI
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Large Deal TCV (FY26)
$15B
+24% YoY
Full-year large deal total contract value, with 55% net new.
Large Deal TCV (Q4)
$3.2B
N/A
Quarterly large deal signings, including 19 deals.
Voluntary Attrition
12.6%
-1.5pp YoY
Annualized voluntary attrition rate, reflecting improved retention.
Utilization (excl. trainees)
83%
N/A
Q4 utilization rate, with full-year at 84.4%.
What Changed vs Last Quarter
NEW
FY27 Revenue Growth 1.5%-3.5% CC
Constant currency revenue growth guidance for FY27, including contributions from recent acquisition Status but excluding others.
NEW
Fresher Hiring ~20,000 in FY27
Plan to onboard approximately 20,000 college graduates in FY27, similar to FY26, with flexibility based on demand.
NEW
Effective Tax Rate 29%-32% for FY27
Expected effective tax rate range for FY27, reflecting normal operations.
UPDATED
FY27 Operating Margin 20%-22%
Operating margin guidance for FY27, with headwinds from wage hikes, productivity pass-throughs, and AI investments offset by Project Maximus.
DROPPED
FY26 revenue growth guidance raised to 3%-3.5% CC
Infosys raised its constant currency revenue growth guidance for FY26 from 2%-3% to 3%-3.5%.
DROPPED
Growth acceleration in Financial Services and EURS in FY27
Management expects growth in Financial Services and Energy, Utilities, Resources, and Services verticals to accelerate in FY27 over FY26.
NEW RISK
Productivity Pass-Throughs from AI
Competitive intensity may force Infosys to pass AI-driven productivity gains to clients, compressing revenue growth.
NEW RISK
European Manufacturing Client Ramp-Down
A large European manufacturing client is reducing spend due to macro challenges and Infosys' decision to walk away from a low-return deal, impacting FY27 growth by 75-100bps.
NEW RISK
Onsite Mix Shift Impacting Revenue
Continued reduction in onsite mix (40-50bps exit trajectory) will lower reported revenue growth, partly offset by offshore benefits.
NEW RISK
Macro Uncertainty and Tariff Risks
Geopolitical conflicts and trade policy shifts could delay client decision-making and discretionary spending, especially in manufacturing and retail.
RISK GONE
Tariff uncertainties impacting Manufacturing and Retail
Manufacturing and Retail/CPG verticals are impacted by tariff uncertainties, delaying client decisions and pressuring discretionary spend.
RISK GONE
AI-led productivity compressing legacy services
AI-driven productivity benefits may compress legacy service revenues, though management sees net positive from new AI opportunities.
RISK GONE
Potential contract attrition from Daimler
Analyst raised concerns about press reports of Daimler moving away; management noted current contracts valid till Dec 2026 but did not provide specifics.
🤫 Topics management stopped discussing
Mentioned in Q1 FY25, Q2 FY25
Outside financial services, discretionary spending remains constrained, with retail, high-tech, and telecom still focused on cost takeouts, delaying broader demand recovery.
Mentioned in Q2 FY25, Q3 FY25
CFO Jayesh Sanghrajka confirmed that compensation increases will create margin headwinds in Q4 and Q1, though exact impact not quantified.
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Guidance and risk preview
Constant currency revenue growth guidance for FY27, including contributions from recent acquisition Status but excluding others.
Competitive intensity may force Infosys to pass AI-driven productivity gains to clients, compressing revenue growth.
View Risks →