Why Is Infosys Stock Is Sliding Today?

Infosys Ltd (NYSE: INFY) reported second-quarter revenue growth of 3.6% year-on-year to $4.72 billion, beating the consensus of $4.61 billion.

Revenues in CC terms grew by 2.5% Y/Y and 2.3% Q/Q. TCV of significant deal win was $7.7 billion. 

The operating margin declined by 30 bps to 21.2%. EPS of $0.18 was in line with the consensus of $0.18 and unchanged from $0.18 a year ago.

Infosys held $4.17 billion in cash and equivalents. It clocked a free cash flow of $670 million, which grew 13.8% year-over-year at a conversion of 89.2% of net profit.

Dividend: The Board has announced an interim dividend of ₹18 per share, an increase of 9.1% over last year.

“We had our highest large deals value at $7.7 billion in Q2 spread across all verticals and geographies. This, in an uncertain macro-environment, is a testament to our ability to pivot and stay relevant to the evolving client needs by delivering the benefits of transformation as well as productivity and cost savings at scale”, said Salil Parekh, CEO and MD. 

“Strong H1 performance with significant large deal wins builds a solid foundation for the future. The growing adoption of our Generative AI offering, Topaz, is helping us deliver consistent value and expand market share”, he added.

FY24 Revenue Outlook: Infosys cuts expectations - expects revenue growth of 1.0% - 2.5% in constant currency (prior 1.0% - 3.5%) vs. consensus $18.71 billion.

Price Action: INFY shares traded lower by 2.90% at $17.10 in the premarket on the last check Thursday.