Infosys, Wipro ADRs down 3% on NYSE after Q2 results even as S&P, Dow drift near record-highs

Infosys, Wipro ADRs Today: American Depository Receipt (ADR) shares of India's leading information technology (IT) service providers Infosys and Wipro witnessed a sharp decline on the New York Stock Exchange (NYSE) after revealing their July-September quarter results for fiscal 2024-25 (Q2FY24). Infosys ADR crashed three per cent to $21.6 on the American stock exchange even after the IT major hiked its FY25 revenue guidance.

Wipro ADR declined nearly three per cent to $5.9 on the NYSE even after India's fourth-largest IT major registered large deal bookings at $1.5 billion in the September quarter, the highest in 10 quarters. The ADRs of the Indian IT giants were trading lower despite Wall Street being poised to open higher, with the S&P 500 and Dow Jones Industrial Average drifting towards all-time highs.

Also Read: Infosys Q2 Results | Net profit rises 4.7% to ₹6,506 crore, revenue up 5% YoY; dividend declared: 5 key highlights

American Depositary Receipt (ADR) is a tool for foreign and multinational companies to trade on US stock markets, just like regular shares of US companies. In theory, an ADR is similar to a special certificate issued by a US bank.

Infosys Q2 Results

Infosys reported a rise of 4.7 per cent in consolidated net profit at ₹6,506 crore, compared to ₹6,212 crore in the corresponding period last year. India's second-largest information technology (IT) service provider's revenue from operations in the second quarter of the current fiscal rose 5.1 per cent to ₹40,958 crore, compared to ₹38,994 crore in the year-ago period.

Revenues in constant currency (CC) terms rose 3.3 per cent YoY and 3.1 per cent sequentially. Earnings before interest and tax (EBIT) stood at ₹8,649 crore, up 4.4 per cent sequentially, compared to ₹8,288 crore in the preceding June quarter. Revenue in US dollar terms stood at $4.894 billion, registering a growth of 3.8 per cent from the preceding June quarter.

Also Read: Wipro bonus issue: IT major’s board approves 1:1 issue of free shares; Record date to be fixed soon

The IT major's board declared an interim dividend of ₹21 per equity share and fixed October 29, 2024, as the record date for the dividend. Infosys also said November 8, 2024, is the payout date for the interim dividend.

The Sahil Parekh-led tech giant raised its revenue guidance for FY25 on broad-based recovery in demand, particularly from its key financial industry clients. The bellwether has raised its revenue guidance for the full fiscal year for the second consecutive quarter. It now expects constant currency revenue growth between 3.75 per cent and 4.5 per cent for the current fiscal, higher than its earlier guidance of 3 per cent to 4 per cent pegged in July.

The upward revision follows a ramp-up of mega deals. For the full year, Infosys, however, maintained its margin guidance. It expects EBIT margins or operating margins for the fiscal year to be between 20 per cent and 22 per cent.

Also Read: Infosys beats Wipro as European clients spur growth

The large deals' TCV (total contract value) was $2.4 billion. Headcount increased for the first time in seven quarters. Infosys added nearly 2,500 employees in the September quarter after ending the previous one with almost 2,000 fewer. The attrition rate rose to 12.9 per cent compared to 12.7 per cent in the preceding June quarter.

Wipro Q2 Results

The leading IT giant posted a 21.2 per cent year-on-year (YoY) rise in its consolidated net profit to ₹3,208.8 crore for the July-September quarter on higher operating profit but gave weak revenue guidance for the next quarter. Wipro had reported a profit of ₹2,646.3 crore in the year-ago period.

Revenue from operations for the second quarter of the current fiscal year was ₹22,301.6 crore, a 0.95 per cent decline from ₹22,515.9 crore in Q2 FY24. Wipro's board approved a bonus issue of shares in the ratio 1:1 of ₹2 each and said the record date for the bonus issue will be announced later.

Also Read: Wipro Q2 results: Net profit surges 21% YoY; here are five key highlights

Wipro's voluntary attrition rate increased to 14.5 per cent from 14.1 per cent in the preceding June quarter. The current employee count stands at 233,889. Operating cash flows of the company recorded at ₹42.7 billion, an increase of 10.5 per cent YoY, which is 132.3 per cent of the net income for the quarter.