Bengaluru, July 13: A higher wage bill weighed heavy on the first quarter profits of tech major Infosys. The company recorded a net profit of Rs 1,488 crore — down seven per cent compared to the previous quarter. Infosys had awarded its employees salary hikes of 9-17 per cent in April this year — a sign of recovery for the sector.
In another positive, the firm has said it expects to hire 36,000 new employees this year — up from 30,000 that it had said earlier. The revenue for the quarter at Rs 6,198 crore was up 4.3 per cent, better than what the firm had guided for.
Infosys is confident that this time around, unlike last year, customer budgets which have seen a marginal rise will be spent as the interest in offshoring and outsourcing is on the rise. The company has guided for revenues of Rs 6,563-6,626 crore for the September quarter — up 17.5 per cent-18.6 per cent over the last year. Revenue for fiscal year ending March 3, 2011, is expected to be in the range of Rs 26,441 crore to Rs 26,885 crore with YoY growth of 2.9 — 7.1 per cent.
“Although we have grown higher than our guidance in the last three quarters and our operating margins are much better than projected, the global economic environment remains uncertain,” said Mr Kris Gopa-lakrishnan, CEO and managing director.
“While we continue to see greater demand for services from our clients especially in North America, there are some distant clouds in the horizon. We don’t know whether they are simple rain clouds or cyclonic storm clouds ahead, but we are prepared to weather any storm.” The company is also planning for better times ahead. “We invested $16 million in visas because when we get into a growth mode, we should not be short on visas. We are also investing in people to make sure that the growth rates are maintained” added Mr Gopalakrishnan.
Infosys has added 38 new clients from 1,206 employees during the quarter. The company had a total of 1,14,822 employees at the end of the first quarter.