India’s second largest information technology (IT) company Infosys, on January 16, raised its constant currency (CC) revenue growth guidance for FY25 to 4.5-5% for a third quarter in a row, as against its previous guidance of 3.75-4.5%.

This has been the eighth revision in the revenue guidance in the last nine quarters for Infosys.

Infosys also retained the operating margin guidance of 20-22% for FY25.

The IT bellwether had started the year with a 1-3% range for its revenue guidance. Brokerages were expecting an upward revision in full-year revenue growth guidance.

“Our strong revenue growth sequentially in a seasonally weak quarter and broad-based year on year growth, along with robust operating parameters and margins, is a clear reflection of the success of our differentiated digital offerings, market positioning, and key strategic initiatives. We continue to strengthen our enterprise AI capabilities, particularly focusing on generative AI, which is witnessing increasing client traction," said Salil Parekh, CEO and MD. “This has led to another quarter of strong large deal wins and improved deal pipeline giving us greater confidence as we look ahead," he added.

Jayesh Sanghrajka, the CFO, said ­­­­­­­­­the company had another quarter of strong performance with revenue growth across segments and operating margin expansion. “Our structured approach to operating margin expansion yielded more results in Q3, particularly due to benefits from improving realization and scale benefits” said Sanghrajka. “Our sharp focus on cash flow is reflected in Free cash conversion to net profits of 157% in Q3 with free cash generation for 9 months of FY25 surpassing that of entire FY24”, he added.

Infosys Q3FY25 net profit rose 11.4 percent year-on-year, beating Street estimates, to Rs 6,806 crore, from Rs 6,106 crore in the year-ago period. According to a Moneycontrol poll of nine brokerages, the IT major's Q3FY25 profit was pegged at Rs 6,734 crore and revenue at Rs 41,206 crore.

Infosys revenue from operations rose 7.5 percent to Rs 41,764 crore in Q3FY25 as compared to Rs 38,821 crore in Q3FY24.

On January 16, Infosys' shares on BSE closed 1.5 percent lower at Rs 1,920 apiece, ahead of the results announcement.

Infosys also raised its CC revenue growth guidance for FY25 to 4.5-5% for the third quarter in a row, as against its previous guidance of 3.75-4.5%.

This has been the eighth revision in the revenue guidance in the last nine quarters for Infosys.

Infosys also retained the operating margin guidance of 20-22% for FY25.

In constant currency terms, the topline grew by 6.1 percent YoY.

The EBIT (earnings before interest and tax) margin or the operating margin was up by 10 basis points (bps) to 21.3 percent. Margins were marginally affected by furloughs.

The company won large deal Total Contract Value (TCV) worth $2.5 billion, of which 63% is net new.

“Our strong revenue growth sequentially in a seasonally weak quarter and broad-based year on year growth, along with robust operating parameters and margins, is a clear reflection of the success of our differentiated digital offerings, market positioning, and key strategic initiatives. We continue to strengthen our enterprise AI capabilities, particularly focusing on generative AI, which is witnessing increasing client traction," said Salil Parekh, CEO and MD. “This has led to another quarter of strong large deal wins and improved deal pipeline giving us greater confidence as we look ahead”, he added.