Infosys Limited (INFY)

Infosys reported second-quarter revenue of $5,145 million on 23 October, up 1.5 percent from a year earlier in constant currency, which strips out currency swings 1.

Operating margin, the share of revenue left after running costs, was 21.0 percent 1. The company cut its yearly revenue growth guidance to 1 percent to 2 percent in constant currency, from 1.5 percent to 3 percent 15. It kept its margin guidance at 20 percent to 22 percent 1.

Chief financial officer Jayesh Sanghrajka said the quarter was softer, with pricing pressure from competition and from clients asking Infosys to pass on AI-led productivity gains 5. Revenue from North America, over half of sales, fell 1.5 percent, its weakest result in two years 5.

Large deal wins were $5.2 billion, with 62 percent net new, and AI work reached 10.5 percent of revenue, up 29 percent from the first quarter 1. One new seven-year deal worth over $2 billion with a financial services client should begin to add revenue in the next fiscal year, the company said 2.

The open question is leadership: AFP reported that executive vice president Ashiss Kumar Dash is to succeed chief executive Salil Parekh when his term ends in April 7.

Infosys was founded in 1981 and is based in Bengaluru, India 4. Nandan Nilekani, its chairman today, co-founded it that year 4. It listed its shares in India in 1993 and its American depositary shares in the United States in 1999 4.

The fastest stretch in the recent record was fiscal 2022, the year to March 2022 9. Revenue jumped 20.3 percent to $16,311 million 9. The company put the rise down to digital revenues, deal wins including large deals, and more work across most segments 9.

Digital revenue, as the company defines it, covers use cases in five areas: Experience, Insight, Innovate, Accelerate and Assure 9. Its share of revenue rose to 57.0 percent from 48.5 percent a year before 9.

The company then returned cash to shareholders 4. A buyback that ran from December 2022 to February 2023 cost $1,130 million and retired 1.44 percent of the shares 4. A second buyback of 100,000,000 shares, about 2.41 percent of the total, was approved by shareholders in November 2025 4.

Growth then slowed 10. Revenue was $19,277 million in fiscal 2025, up 3.9 percent, or 4.2 percent in constant currency 10. Two years before that, revenue had been $18,562 million 4.

To protect profit during the slowdown, the company ran Project Maximus, a margin program with five pillars 10. They were value-based selling, a more efficient staffing pyramid, automation and generative AI, improving weak portfolios, and cutting indirect costs 10.

Fiscal 2026 revenue reached $20,158 million, up 4.6 percent, or 3.1 percent in constant currency 4. A weaker dollar added to the reported figure, falling 8.4 percent against the euro 4. Europe grew from $5,745 million to $6,480 million 4.

Reported operating margin slipped to 20.3 percent from 21.1 percent in the year, after a $143 million charge from India's new labour codes 4. Excluding that charge, it was 21.0 percent 4.

The current year began with a first-quarter revenue of $5,082 million, up 2.4 percent in constant currency, an operating margin of 21.1 percent and large deal wins of $3.6 billion 8. That was before the October cut 81.

Guidance has fallen in steps 7. In March the company forecast 1.5 percent to 3.5 percent growth for the current year, AFP reported 7. In July it trimmed the top end to 3.0 percent, and in October it cut the whole range 75.

Services and platforms

Infosys sells consulting, technology and outsourcing services to large companies 4. Its annual report lists Consulting, AI-first and AI-augmented services, and Business Process Management, which runs back-office work for clients 4. Cybersecurity is a separate line 4.

Its services brands are Infosys Cobalt for cloud, Infosys Topaz for AI and Infosys Aster for marketing 4. Its products include Finacle for banks, McCamish for insurance and financial administration, Panaya for software testing and Equinox for commerce 4.

Infosys Topaz and AI work

AI revenue was 10.5 percent of sales in the second quarter, up from 8.2 percent in the first 18. The company calls Topaz its generative and agentic AI suite, and says an AI-first services market of $300 billion to $400 billion by 2030 is open to it, citing market estimates 4.

On its call, management said it works with frontier model companies, both open weight and closed models 2. It describes Topaz Fabric as the layer that lets clients move between models 2.

Finacle, banking software

Finacle is the company's digital banking software, offered as a cloud service 4. In the second quarter, Investec chose Finacle SaaS on Microsoft Azure for its digital banking transformation 1.

Infosys says Gartner rated Finacle a Leader in its 2026 Magic Quadrant for Retail Core Banking Systems in Europe 1. It adds that IDC MarketScape named Finacle a Leader in Worldwide Trade Finance Systems 2026 1.

Industries it serves

Financial Services was the largest segment in the second quarter at 28.0 percent of revenue, then Manufacturing at 16.0 percent and Energy, Utilities, Resources & Services at 14.2 percent 3. Communication was 12.5 percent and Retail 11.5 percent 3.

Life Sciences grew 32.5 percent from a year earlier, while Hi-Tech fell 17.5 percent and Retail fell 8.1 percent in reported terms 3. Management blamed lower third-party revenues and budget cuts at a few large Hi-Tech clients 2.

By client location, North America was 54.6 percent of second-quarter revenue, Europe 32.5 percent, the rest of the world 10.1 percent and India 2.8 percent 3.

Clients

Infosys had 2,060 active clients at the end of the quarter, of which 42 paid it more than $100 million over the past twelve months 3. The top five clients made 12.2 percent of revenue, and the top ten 19.8 percent 3.

Named client wins in the quarter include a ten-year agreement with Crocs, an AI-led supply chain program with Mondelez International and work for Telia on network and cybersecurity operations 1.

People and campuses

Infosys had 332,542 employees at the end of the second quarter, and voluntary attrition was 12.7 percent over the last twelve months 3. Management said it hired about 13,000 freshers in the first half, toward a target of about 20,000 for the year 2.

Its headquarters campus at Electronics City, Bengaluru, covers about 4.7 million square feet of land and 6.5 million square feet of working space 4. Capital spending on property and equipment was $306 million in fiscal 2026 4.

Leaders

Nandan Nilekani is the non-executive chairman and Salil Parekh the chief executive 4. Jayesh Sanghrajka is chief financial officer, Inderpreet Sawhney chief legal officer and Shaji Mathew chief human resources officer 4. Parekh was earlier on the management board of Capgemini 4.

Rivals

Reuters called Infosys India's No. 2 IT firm and said peers Tata Consultancy Services and HCLTech met revenue estimates earlier in October 56. An analyst quoted by Reuters said peers are better placed than Infosys at this point 6.

AFP wrote that AI tools from companies like Anthropic and OpenAI offer new ways to do work once outsourced 7. A Reuters analyst also said clients building their own offshore tech hubs hurt Infosys 6.

Current problems

Management said pricing rises the company expected this year have not appeared, volumes were softer and Retail and Hi-Tech clients slowed spending 2. Brokerage Motilal Oswal also pointed to Infosys' decision to exit a large European manufacturing contract 6.

Visa costs are another pressure point 11. Forrester wrote that the administration had imposed a $100,000 fee on new H-1B visa applications, and that large Indian providers had cut visa staff to well below half of their US workforce 11.

The umbrella, in words

Brands: Infosys Cobalt, Topaz and Aster are service brands, and Finacle, McCamish, Panaya and Topaz Fabric are products, per the annual report 4. The former EdgeVerve platforms are now part of Infosys Topaz AI Next 4.

Subsidiaries: Exhibit 8.1 to the annual report lists wholly owned units such as EdgeVerve Systems in India, Panaya Inc. and Infosys Nova Holdings in the U.S. 12. Infosys Arabia in Saudi Arabia is held at 70 percent 12.

Deals: Infosys Nova completed its acquisition of the insurance technology firm Stratus Global on 21 April 2026 and of the healthcare consulting firm Optimum Achieve Holdings in early May 2026 4. It agreed in August 2025 to buy 75 percent of Telstra's Versent Group, subject to approvals at the time of the report 4.

Control: the annual report's table of major holders lists Life Insurance Corporation of India with 10.81 percent 4. Directors and officers as a group held 2.53 percent, and foreign investors 26.10 percent 4.

For the current fiscal year, Infosys guides to revenue growth of 1 percent to 2 percent in constant currency and an operating margin of 20 percent to 22 percent 1.

The finance chief said the low end assumes further macro deterioration and the high end an improvement 2. Financial Services and Energy, Utilities, Resources & Services are expected to grow faster than the company average 2.

Margins in the second half face compensation hikes, softer seasonality, continued sharing of AI productivity gains and the ramp-up of large deals 2. Project Maximus should offset part of that 2.

Pay rises take effect in October '26, with a next phase in January '27 2. The company expects an effective tax rate of 29 percent to 30 percent for the year 2.

The over $2 billion seven-year financial services deal is due to begin transition in the second half of the fourth quarter and add over 1 percent to growth in the next fiscal year, management said 2.

The board declared an interim dividend of 26 rupees per share, up 13 percent from last year 1. Management also said the large deal pipeline is healthy and includes other mega deals 2.

On leadership, AFP reported in July that Ashiss Kumar Dash is to become chief executive after Salil Parekh's term ends in April 7. Parekh called Dash a leader of integrity with a customer focus 7.

The Versent purchase, agreed in August 2025 for up to AUD 233 million, was still subject to regulatory approvals when the annual report was filed 4. The company describes Versent as Australia's leading digital transformation solutions provider 4.

Chief executive Salil Parekh said in the quarter's release that Infosys continues to invest in deep domain and technology capabilities to help businesses unlock AI value at scale 1.

Management said its assumptions about acquisitions, the large European manufacturing deal and the shift to offshore delivery are broadly unchanged 2. It also plans to keep investing in Topaz capabilities and partnerships 2.