Wipro Q3 net surges 24.5% on consulting boost, lower costs

Wipro, country’s fourth largest IT services company, saw a 24.5% year-on-year (YoY) jump in net profit at Rs 3,366.7 crore for the October to December quarter of the ongoing fiscal year backed by growth in consulting business Capco, rupee depreciation and lower employee and other expenses. With similar growth, profit attributable to equity shareholders stood at Rs 3,353.8 crore, up 4.7% sequentially from Rs 3200.8 crore in the previous quarter.

However, revenue remained subdued due to furloughs and seasonal weakness meeting its guidance, rising marginally by 0.1% YoY to Rs 22,318 crore from Rs 22,205 crore in December quarter 2023-24. On a quarter-on-quarter basis, revenue was up 0.5%. Within revenues, IT services growth declined by 1.2% sequentially and 1.0% YoY but in constant currency (cc) terms grew 0.1% QoQ and declined 0.7% YoY, within the upper end of its guided range for Q3 at -2.0% – 0.0% given in the last quarter. Capco business grew 11% YoY with a 9% increase in its order book.

“The discretionary continues to build up in certain industry segments especially like BFSI (banking, financial services & insurance), it is also reflecting in our Capco growth… We are seeing an uptick in terms of the smaller sized deals board. I think that will continue to be across AI, data and cloud,” said Srini Pallia, chief executive and managing director of Wipro.

For Q4, the Bengaluru IT major has given a relatively more optimistic guidance for IT services revenue to be in the range of $2,602 million to $2,655 million, translating into a sequential growth of -1.0% to 1.0% in cc terms.

“If you look at 2025, we are more hopeful and resilient. Our clients are cautiously optimistic, and we see discretionary spending slowly coming back, while cost optimisation continues to remain. We also see significant opportunities in AI spending,” Pallia added.

Wipro continued to remain a laggard as compared to its peers. A day prior, its cross-city rival Infosys reported strong 11.4% YoY and 4.6% quarter-on-quarter (QoQ) growth in net profit at Rs 6,806 crore while revenue surged 7.6% YoY and 1.9% QoQ to Rs 41,764 crore. Infosys also upgraded its FY25 outlook to 4.5%-5.0% in constant currency terms. Its immediate peer HCLTech’s profit rose both on a YoY and sequential basis with 5.1% and 3.6%, respectively. HCLTech also upgraded its lower end of the guidance with full year revenue estimated to now grow 3.5- 5% YoY in constant currency terms.