Infosys shows fall in revenue
SHARES in Indian software giant Infosys fell more than eight per cent on Thursday (July 12) after the company announced a surprise cut in its full-year revenue outlook and reported a lower-than-expected profit.
The company, closely watched by investors as a barometer for the country’s flagship technology sector, scaled down its full-year dollar revenue outlook to around $7.34bn (£4.75bn), marking growth of just five per cent.
That compared to an 8.0 to 10 per cent growth estimate announced in April.
“This is a difficult economic environment all over the world,” Infosys chief executive S D Shibulal said.
“A lack of confidence, slow decision-making and holding up decisions on new projects are the reasons for the lower revenue guidance,” Shibulal told reporters after a board meeting in the southern IT hub of Bangalore.
The news spooked investors who did not expect Infosys to cut its revenue outlook, prompting shares in the company to tumble 10.1 percent to a low of Rs2,216.05 ($39.67/£25.69) in early trade.
The company’s shares ended down 8.15 per cent at Rs2,265.25 ($40.56/£26.26).
Analysts said they would scrutinise earnings to be reported by TCS, India’s largest software company by sales, late on Thursday and the tone from its management on the business outlook.
Shibulal said the company wrote off $15m (£9.71m) on a transmission project in Europe, which resulted in a fall in revenue.
Infosys added 51 clients and a net 1,157 staff in the quarter.
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