Wipro Q4 profit dips 8%; revenue down 4.2%

IT services major Wipro Ltd reported an 8% year-on-year (YoY) fall in consolidated net profit during the January-March quarter of FY2023-24 at ₹2,835 crore as compared to ₹3,074 in the same quarter in the previous fiscal, primarily due to challenging macro-environment. Despite a fall in Q4 profit, the company beat analysts in both profit and revenue estimates.

Wipro, in an exchange filing today, says FY24 proved to be a challenging year for the IT services industry, and the macro environment remains uncertain.

The company's revenue for Q4 FY24 was ₹22,210 crore ($2.7 billion), flat QoQ basis, but down 4.2% compared to ₹23,190.3 crore in the year-ago period.

IT services operating margin for the quarter was at 16.4%, up by 40 bps QoQ, while earnings per share for the quarter was at ₹5.43 ($0.071), an increase of 5.2% QoQ.

According to Wipro, its voluntary attrition for the said quarter was at 14.2% on a trailing 12-month basis.

"I am optimistic about the opportunities that lie ahead. We are on the brink of a major technological shift. Artificial intelligence is transforming our clients’ needs as they seek to harness its power for competitive advantage and enhanced business value. At Wipro, we have been gearing up for this moment," says Srini Pallia, CEO and Managing Director, Wipro.

Aparna Iyer, Chief Financial Officer, says the company expanded margins by 40 basis points in Q4, resulting in EPS growth of 5.2% QoQ in Q4. “Despite a challenging macro-environment, our IT services margin expanded by 50 basis points for the full year FY24. We generated the highest operating cash flow in recent years which is at 183% of our net- income in Q4 and 159% on a full-year basis.”

For the full fiscal year, Wipro's gross revenue reached ₹89,760($10.8 billion), a decrease of 0.8% YoY. Its net profit for the year was at ₹11,050 crore ($1,325.3 million), a decrease of 2.7% YoY. The company's IT services segment revenue was at $10,805.3 million, a decrease of 3.8% YoY. For FY24, Wipro's large deal bookings stood at $4.6 billion, up by 17.4% YoY, while total bookings at $14.9 billion dipped 5.5% YoY. Earnings per share for the year was at ₹20.89 ($0.251), an increase of 0.8% YoY.

In its outlook, Wipro says it expects revenue from the IT services business segment to be in the range of $2,617 million to $2,670 million. "This translates to sequential guidance of (-)1.5% to +0.5% in constant currency terms."

The Wipro board confirmed the interim dividend of ₹1 declared in January will be considered as the final dividend for FY24. The Wipro share closed 1.92% up at ₹452.85 on the BSE today.