Indian IT services company Wipro on Wednesday, October 18, reported a marginal decline in its July-September quarter (Q2FY24) revenue at Rs 22,516 crore due to the macroeconomic slowdown and cut backs on discretionary IT spending by clients. The IT major's profit after tax (PAT) rose 0.70% year-on-year (YoY) to Rs 2,667 crore.

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Wipro had reported a profit of Rs 2,649 crore and revenue of Rs 22,540 crore in the corresponding quarter of last year.

The IT services revenue is seen to contract 3.5% to 1.5% in constant currency (CC) terms. IT services segment revenue stood at $2,713.3 million, down 2.3% quarter-on-quarter (QoQ).

The IT major's revenue numbers are lower than the Rs 22,760 crore anticipated in a CNBC-TV18 poll.

IT services operating margin for the September quarter came in at 16.1%, up 10 basis points QoQ and 100 basis points YoY.

“We continue to win in the market despite the uncertain macro environment,” said Thierry Delaporte, CEO and Managing Director. “We ended the second quarter with 22 accounts above the $100M range, which is double the number we had in FY’21.Our large deal total contract value reached $1.3 billion—highest in the last nine quarters.”

Delaporte added: "We are investing in our technology infrastructure and streamlining our operations and delivery to drive profitable growth. We are training and reskilling our people so they can be ready for an AI-driven future."

Total bookings stood at $3.8 billion, up by 6% YoY and large deal bookings was at $1.3 billion, up by 79.0% YoY.

Headcount, attrition

Wipro's headcount drops by 5,051 employees sequentially in Q2 of FY24. "We remain focused on profitable growth despite a challenging market. Our disciplined approach to improve efficiency, productivity and utilization has led to an increase of 100 bps YoY in our IT services operating margins," said Aparna C Iyer, Chief Financial Officer, Wipro.

The IT major's voluntary attrition has continued to moderate QoQ, coming in at 9-quarter low of 13.4% in Q2FY24.

Wipro approves merging 5 units into itself

The Board has approved merging five units into itself. "The Board of Directors of the company, at its meeting held over October 17-18, 2023, considered and approved a scheme of amalgamation ('Scheme') pursuant to Sections 230 to 232 and other relevant provisions of the Companies Act, 2013, providing for the merger of the following whollyowned subsidiaries with and into Wipro Limited ('Transferee Company')," it said in a filing.

1) Wipro HR Services India Private Limited

2) Wipro Overseas IT Services Private Limited

3) Wipro Technology Product Services Private Limited (formerly known as Encore Theme Technologies Private Limited)

4) Wipro Trademarks Holding Limited

5) Wipro VLSI Design Services India Private Limited (collectively “Transferor Company”)

Shares of Wipro had hit a 52-week high of Rs 443.75 on September 15, and then slipped to the current market price of Rs 408.95. The stock has corrected 8% from its 52-week highs and since the Q2 earnings of Tata Consultancy Services (TCS) were announced, it has slipped 3%. During the quarter under review, the stock witnessed an increase of 4.4%.

First Published:Oct 18, 2023 4:01 PM IST