Wipro Revises Q4FY24 CC Revenue Guidance Upwards Amidst Resilient Margin And Order Wins

Leading technology services provider Wipro Ltd anticipates a revenue rollercoaster for the March quarter, projecting a fluctuation between a 1.5% drop and a 0.5% growth on a constant currency basis. The announcement follows the release of the company's December quarter financial results, which showcased both challenges and triumphs.

In US Dollar terms, Wipro reported a 2.1% sequential decline in revenue, amounting to $2,656.1 million. Meanwhile, in rupee terms, the revenue stood at Rs 22,151 crore, slightly lower than the Rs 22,395.8 crore recorded in the September quarter. The Earnings before Interest and Tax (EBIT) remained flat at Rs 3,542.6 crore, compared to Rs 3,606 crore in the preceding quarter. On a sequential basis, Wipro witnessed a 1.1% dip in revenue, with EBIT also experiencing a 1.8% downturn.

Despite the challenges, the company's EBIT margin for the quarter surpassed estimates, reaching 16%. This figure was 10 basis points lower than the 16.1% reported in the September quarter but higher than the anticipated 15.2%. The resilience of these margins surprised many, especially considering the wage hike implemented on December 1. Wipro's Chief Financial Officer, Aparna Iyer, attributed this accomplishment to the company's ability to withstand revenue headwinds and absorb the impact of investments made for growth.

During the December quarter, Wipro clinched deals worth an impressive $3.8 billion, comprising 14 substantial victories. The total deal wins saw a marginal growth of 0.2% sequentially, and according to Managing Director and CEO Thierry Delaporte, large deals experienced a robust 20% growth on a year-to-date basis. Delaporte expressed optimism, noting that the company is witnessing early signs of a return to growth in consulting, particularly as their Capco business achieved double-digit growth.

In terms of workforce dynamics, Wipro reported a net reduction of over 4,400 employees during the December quarter. The company's attrition rate hit a 10-quarter low, standing at 14.2%. This reduction in attrition could be a positive indicator of the company's employee retention strategies and workplace satisfaction.

Wipro declared a dividend of Rs 1 per share, with the record date set as January 24, 2024. The dividend announcement, coupled with the company's resilient performance, sparked a 4% surge in Wipro's shares before the results were disclosed, closing at Rs 466.10. Post-results, the company's shares listed in the US are trading 5% higher in pre-market trading, indicating a positive market response to Wipro's strategic wins and financial resilience.