Wipro's June quarter profit slides 21% to Rs 2,563 crore on higher expenses

IT services major Wipro Ltd on Wednesday reported a 20.6 percent year-on-year (YoY) decline in consolidated net profit at Rs 2,563.6 crore for the first quarter ended Jun 30, 2022, on higher expenses. In the corresponding quarter last year, the company posted a net profit of Rs 3,242.6 crore.

The Bengaluru-headquartered company's revenue from operations stood at Rs 21,528.6 crore during the period under review, up 18 percent against Rs 18,252.4 crore in the corresponding period of the preceding fiscal.

The company's earnings before tax (EBIT) increased 9.18 percent quarter-on-quarter to Rs 3,183.2 crore from Rs 3,505 crore, according to the regulatory exchange filing by the company to the stock exchanges.

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EBIT margin stood at 15 percent in the June quarter compared with 17 percent in the March quarter. In dollar terms, Wipro's revenue stood at $2,735.5 million in June 2022 quarter, a rise of 0.51 percent quarter-on-quarter.

For the September quarter, the company expects revenue from the IT services business to be in the range of $2,817 million to $2,872 million. This translates to a sequential growth of 3.0 percent to 5.0 percent.

During the quarter, Wipro added 15,446 employees and its workforce strength stood at 258,574 employees. The company's attrition rate stood at 23.3 percent in the first quarter of FY23.

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Thierry Delaporte, CEO and managing director said the company made significant investments in Wipro’s growth engine and is very pleased with the outcomes.

"Our order bookings grew 32 percent YoY in total contract value terms, powered by large transformational deals, and our pipeline today is at an all-time high," he said.

The company said all strategic market units and global business lines grew double-digit YoY CC in the first quarter. The order book in total contract value (TCV) terms grew 32 percent and in annual contract value (ACV) terms grew 18 percent YoY in the first quarter. Also, it has closed 18 large deals resulting in a TCV of $1.1 billion in the first quarter.

"We continue to reinforce the investments that allow us to grow our business, remain agile in the market and efficient as an organization, while staying focused on serving our clients even better," Delaporte added.

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Jatin Dalal, the chief financial officer said, "The company is consistently investing in solutions and capabilities for our growth to further strengthen our position of being a strategic partner for our clients. At 15% of operating margins, we believe that we have bottomed out."

The results came after the close of the market hours.