ISLAMABAD – India’s second-largest IT outsourcing firm Infosys on Fridayreported a 2.2-percent dip in quarterly net profits, hit by slowing demandfor its software services in Western markets.
Net profit in the three months ending September came in at 40.37 billionrupees ($569 million), in line with estimates but lower than the 41.10billion rupees reported a year earlier for the same quarter.
Infosys earns over 60 percent of its total revenue from the United States.
“Our performance was robust on multiple dimensions — revenue growth,digital growth, operating margins, operational efficiencies, large dealsignings and reduction in attrition,” Infosys chief Salil Parekh said in astatement.
The Bangalore-headquartered company raised its forecast for earnings growthfrom 8.5-10 percent to 9-10 percent in dollar terms for the current fiscalyear.
The September-ended quarter is generally considered a strong one forIndia’s $150 billion IT sector — one of the country’s flagship industries– due to increased spending from clients in Western markets.
But US-China trade tensions have hammered sentiment, with the InternationalMonetary Fund forecasting the weakest growth in a decade.
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India, Asia’s third-largest economy, saw growth fall to five percent in theJune quarter, official data showed as manufacturing activity and consumerdemand cooled.
Many financial agencies have revised the country’s growth projections forthe 2019-20 financial year, with some warning that a stronger dollar wouldcause the rupee to fall throughout 2019, stoking inflation and erodingdemand further.
On Thursday, ratings agency Moody’s revised the country’s GDP growthforecast to 5.8 percent for the financial year 2019-20, lower than the 6.1percent projected by the Reserve Bank of India.
Infosys rival TCS missed quarterly profit estimates and posted a 1.8percent rise in profits on Thursday, much below expectations. – APP/AFP
