Wipro, backed by Azim Premji, recently unveiled its financial performance for the September-December quarter of fiscal year 2023-24 (Q3FY24). The results showed a nuanced picture, with some areas reflecting resilience while others indicated challenges in the market.
Financial Overview
The consolidated net profit for Q3FY24 stood at ₹2,694 crore, reflecting a marginal 1% quarter-on-quarter (QoQ) increase but marked a 12% decline year-on-year (YoY) basis. Revenues totalled ₹22,205 crores, signalling a 4.4% decrease compared to last year’s corresponding period. Sequentially, revenue saw a 1.4% drop, while in constant currency, it declined by 1.7% QoQ and 6.9% YoY.
Deal Bookings and Large Deals
Wipro reported total bookings of $3.8 billion in constant currency for Q3FY24, with a slight 0.2% QoQ increase but a 13.5% YoY decline. Large deal bookings amounted to $0.9 billion, reflecting an 8.3% YoY decrease.
CEO’s Perspective
Thierry Delaporte, CEO and Managing Director of Wipro acknowledged the seasonally soft quarter but highlighted the strong deal booking momentum. He pointed out a 20% year-to-date growth in large deals and noted positive growth in consulting, as evidenced by double-digit order bookings in the Capco business.
Segment-Wise Performance
The company witnessed a decrease in revenue across various sectors, including banking, financial services, and insurance (-12.1% YoY), consumer (-6.9% YoY), manufacturing (-9.1%), and communications (18.8%). However, the health sector and technology experienced positive trends, with a 10.3% YoY and a 1.8% YoY increase in revenue, respectively.
Client Metrics
Wipro’s client base with revenue exceeding $100 million grew to 22, up from 19 in the previous quarter. However, on a QoQ basis, it remained flat. Deals valued above $75 million increased to 31 from 29 in Q3 FY23, showing a slight improvement on a QoQ basis.
Attrition and Workforce
Wipro reported a net reduction of 4,473 employees in Q3, ending the quarter with a workforce of 240,234. The voluntary attrition rate reached a 10-quarter low of 12.3% in Q3FY24.
Outlook for Q4FY24
Wipro anticipates revenue from its IT services business segment to be $2,615 million to $2,669 million for Q4FY24. It translates to a sequential guidance of -1.5% to +0.5% in constant currency terms.
Summary
Wipro’s Q3FY24 results showcase a complex scenario, with specific sectors facing headwinds while others demonstrate resilience. The company’s focus on deal bookings and its optimistic outlook for Q4 suggests a proactive stance in navigating the market challenges. As the industry evolves, Wipro remains poised to adapt and capitalize on emerging opportunities.
Disclaimer: We do not endorse or encourage you to take trades or investment decisions based upon our posts/research, all of your trading and investment activities are your own and should be taken through consultation with reputed financial advisors. The analysis posted on this website has been created by involving multiple mediums which are present over the Internet.