With the fiscal fourth quarter earnings season already started and major IT services firms – Tata Consultancy Services (TCS), Wipro and Infosys – having released their Q4 numbers, analysts said that the cautious tone of the companies’ management for FY26 amid global uncertainties is a matter of concern. The three IT giants have reported mixed Q4FY25 performance amid major headwinds such as global growth slowdown, persistent demand uncertainty, and concerns over US tariff.
Earlier, brokerages had speculated a weak Q4. JM Financial said, “Elevated uncertainty – both regulatory and economic – means actual performance could turn out to be weaker. There have been sporadic instances of pauses, even ramp-downs through the quarter. We therefore expect the companies to be in the bottom-half of their guided band. Overall, we expect (1.4)-0.2 per cent cc QoQ growth for large-caps. Mid-caps under coverage should do better (0.6-3.3 per cent).”
Kotak Institutional Equities had also stated, “The deterioration in the macro environment will weigh on Q4FY25 numbers and FY2026 guidance.”
Infosys’ key numbers
On April 17, Infosys released its Q4 results with profit at Rs 7033 crore,down 11.75 per cent in comparison to Rs 7969 crore during the same period of previous financial year. The company reported revenue from operations at Rs 40,925 crore, up 7.92 per cent as against Rs 37,923 crore posted during the same period of FY24. Biswajit Maity, Sr Principal Analyst, Gartner, said, “Infosys achieved a 4.2 per cent YoY growth in constant currency terms during Q4. It’s important to note that global economic headwinds, geopolitical instability, and reduced discretionary spending have impacted revenue growth across most IT providers. As a result, muted earnings were anticipated. However, several factors support an optimistic outlook for Infosys.”
Elara Capital added, “Infosys’ Q4 sequential revenue declined a steep 3.5 per cent in CC and 4.2 per cent in USD. Majority of this was due to the slippage of billing for third-party software and hardware procured on behalf of clients to Q1, also due to volume drop.”
Wipro’s key numbers
On April 16, Wipro announced its Q4 numbers wherein it reported profit for the period at Rs 3569.60 crore, up 25.93 per cent in comparison to Rs 2834.60 crore during the same period of previous financial year. It posted revenue from operations for the quarter in review at Rs 22,504.20 crore, up 1.33 per cent YoY. ICICI Securities said, “Revenue was impacted due to – 1) project ramp downs, 2) volume drop, 3) pause in large transformation programs.”
Biswajit Maity from Gartner, said, “Wipro’s Q4 growth remained nearly flat at 0.8 per cent in constant currency, primarily impacted by weak discretionary spending and ongoing global economic uncertainty. Still, there are positive signs for future performance, driven by a strong deal pipeline and recovery in key sectors like BFSI and healthcare, which may offset weaker-performing areas.”
TCS’ key numbers
On April 10, TCS announced its Q4FY25 results and recorded a profit of Rs 12,224 crore, down 1.69 per cent in comparison to Rs 12,434 crore recorded during the corresponding quarter of FY24, missing estimates. It posted revenue from operations at Rs 64,479 crore, up 5.29 per cent YoY. Elara Securities said, “TCS reported a revenue de-growth of -1 per cent (-1 per cent QoQ in CC) in Q4 due to continued weakness in discretionary spend as well as a pause in certain programs by the clients. In INR terms, the drop was limited due to INR depreciation against USD growth as revenues in INR growth were up 0.8 per cent QoQ.”
Meanwhile, Biswajit Maity from Gartner, said, “Despite all global economic challenges, TCS showed decent performance and kept its deal pipeline stable. Overall, IT vendors are expected to close the last quarter with muted growth. The slowdown has been driven by global uncertainty, government budget cuts, lower discretionary spending, and rising competition.” However, he added, the outlook for 2025 remains optimistic, with the industry expecting a return to double-digit growth. “I don’t see any major long-term concerns and believe that the current uncertainty will gradually subside, allowing Indian IT providers to regain their growth trajectory,” he said.
TCS vs Wipro vs Infosys
Here is a comparison between the performance and key projections by the three IT majors:
FY26 guidance
Wipro: Wipro said, “We expect revenue from our IT Services business segment to be in the range of $2,505 million to $2,557 million. This translates to sequential guidance of (-)3.5 per cent to (-)1.5 per cent in constant currency terms.” JM Financial said, “Wipro cited pauses in large transformational programs and caution around discretionary spend as reasons for a weak guidance.”
Infosys: Infosys narrowed its revenue growth guidance for FY26 in constant currency terms to 0- 3 per cent in comparison to 4.5 per cent to 5 per cent as was projected at the December quarter. The IT giant also revised its guidance for operating margin for the current financial year to 20-22 per cent. SBI Securities said, “The underlying macroeconomic challenges are making clients more cautious over IT budgets thus leading to slowdown in discretionary spending. The company has factored in demand deterioration at the lower end of guidance with slight improvement in the upper end.”
Deal wins:
TCS: TCS posted a strong TCV performance at $39.4 billion for FY25 and at $12.2 billion for the fiscal fourth quarter. JM Financial said, “Management reported a record-high TCV of $12.2 billion for Q4, reflecting continued strength in deal momentum across markets and verticals. Notably, this performance was achieved in the absence of any mega deals. North America reached an all-time high TCV of $6.8 billion, BFSI TCV was $4 billion and Consumer business contributed $1.7 billion. Additionally, rising traction in GenAI and AI-for-IT programs contributed to deal wins, reinforcing confidence in future revenue visibility.”
Wipro: Wipro’s large deal booking jumped 48.5 per cent year-on-year in Q4FY25 to $1,763 million in constant currency terms. Its total bookings for the quarter stood at $3,955 million in constant currency terms, an increase of 13.4% sequentially. The large deals rose 17.5% YoY for the financial year 2024-25. ICICI Securities said, “Wipro won 17 large deals in Q4 and 63 in FY25 including two mega deals. Large deal bookings were up 17per cent YoY, but TCV (ex-large deals) was down 13.4per cent YoY for FY25, implying weakness in smaller discretionary deals. Weak small deals and leakage in existing deals are dragging down revenue growth.”
Infosys: Infosys’ large deal wins stood at $2.6 billion in the last quarter of the financial year 2024-25. For the whole fiscal year, the large deal total contract value stood at $11.6 billion, out of which 56% were new contracts. Nuvama said, “Infosys won 24 large deals with TCV of $2.6 billion (+4.2 per cent QoQ/-41.6 per cent YoY), with 63 per cent net new deals in Q4. It announced two acquisitions (MRE consulting and Missing link security), for $98 million – to contribute ~0.5 per cent to FY26 topline (not part of guidance).”
Attrition
TCS: TCS’ attrition rate for the last twelve months stands at 13.3 per cent for the quarter under review. However, the IT giant’s headcount has risen by 6,433 in Q4 FY25 standing at 607,979. In Q4 FY24, the company’s total headcount stood at 601,546. It rose by 625 people compared to a quarter ago at 607,354. TCS is yet to decide on wage hikes for FY26 due to the uncertain environment.
Wipro: Wipro said that voluntary attrition was at 15.0 per cent on a trailing 12-month basis. Meanwhile the total headcount stood at 233,346 — up by 614 from 2,32,732 in Q3FY25.
Infosys: Infosys’ attrition rate stands at 14.1 per cent for the trailing twelve months in Q4 FY25, a rise of 1.5 percentage points year-on-year, compared to the attrition rate at 12.6 per cent in Q4FY24. The attrition rate in Q3FY25 was 13.7 per cent. However, the total headcount in Q4FY25 rose by 2 per cent to 3.24 lakh employees, as against 3.17 lakh employees in Q4 FY24.
Dividend declaration
TCS: TCS announced a final dividend of Rs 30 per equity share of Rs 1 each of the company. It further said that the dividend shall be paid/dispatched on the fifth day from the conclusion of the 30th Annual General Meeting. The total dividend declared for the last financial year stood at Rs 126.
Wipro: Wipro said that the interim dividend announced by the company board on January 17 will be considered as the final dividend for the financial year 2024-25.
Infosys: Infosys announced a final dividend of Rs 22 per equity share for the financial year ended March 31, 2025. The company announced the date for the payment of the dividend as June 30, 2025. Jayesh Sanghrajka, CFO, Infosys, “The Board has proposed a final dividend of Rs 22, which along with the interim dividend, is an increase of 13.2 per cent over last year.”