Infosys shares jump 3% ahead of Q2 earnings announcement. What to expect?

However, analysts forecast India's second-largest IT services company to lower its full-year revenue growth guidance amid weak discretionary spending, AI-led pricing pressure and slower client decision-making.The Bengaluru-based IT major is expected to report revenue of around Rs 49,384 crore for the second quarter, as compared with Rs 44,490 crore in the corresponding period last year, based on the brokerage consensus.Consolidated net profit is expected to increase to Rs 7,965 crore from Rs 7,375 crore a year earlier.Live EventsInvestors will closely watch out for Infosys management’s commentary on client spending, large deal wins and the impact of artificial intelligence on its traditional IT services business.The results will effectively wrap up the Q2 earnings season for major IT companies, following announcements by TCS, HCL Technologies, Wipro and Tech Mahindra.How did Infosys perform in the previous quarter?Infosys in July reported 12% year-on-year (YoY) growth in its consolidated net profit at Rs 7,769 crore in the first quarter of FY27.

The same stood at Rs 6,921 crore in the last year quarter. Revenue from operations in the reporting period increased 14% YoY to Rs 48,211 crore.For the full financial year 2027, the company trimmed the upper end of the revenue growth guidance 1.5%-3% in constant currency, while operating margin outlook was given at 20-22%.Operating profit stood at Rs 10,163 crore, up 15% from Rs 8,803 crore a year earlier.

Operating margin came in at 21.1%, compared with 20.8% in the year-ago quarter and 21% in the March quarter.Infosys said AI revenue stood at 8.2% of total revenue in Q1. Large deal total contract value was $3.6 billion, with 61% net new business. Free cash flow stood at $955 million, or Rs 9,051 crore, with free cash flow conversion at 116.4% of net profit.In the longer term, the stock has fallen more than 16% in three years and 31% in five years.

The company has a market capitalisation of around Rs 4.18 lakh crore.Disclaimer: This article has been written by Debaroti Adhikary, who is not a SEBI-registered Research Analyst or an Investment Adviser. Debaroti Adhikary and his/her ‘relative(s)’ (as defined under Section 2(77) of the Companies Act, 2013) do not hold any financial interest in the companies mentioned in this article as of the date of publication.

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