Infosys Ltd ADR (NYSE: INFY) reported a decent first quarter of FY 18 results and accordingly the stock rose over 0.7% on July 14th, 2017 (Source: Google finance). The stock rose 0.2% in the pre-market session today (on July 17th, 2017, Source: Google finance). As per the recent 13F filing from Highbridge Capital Management, they enhanced their stake in the firm by 434.5% during the first quarter.
Major client wins in North America and Europe boosted the stock performance during the quarter. The net profit grew 1.4% to $540.38 million. Infosys has reported the adjusted earnings per share of $15.23 in the first quarter of FY 18, beating the analysts’ estimates for the adjusted earnings per share of $14.90. The company had reported the adjusted revenue growth of 1.8 percent to $170780.00 million in the first quarter of FY 17, beating the analysts’ estimates for revenue of $170506.75 million. However, on a sequential basis, Infosys net profit has declined 3.3% while revenues were down 0.2% in rupee terms.
Infosys has kept its full year ending March 2018 revenue growth guidance at between 6.5% and 8.5% on a constant currency basis and 7.1%-9.1% in US dollar terms. That beat analyst estimates and its own previous outlook, both of which projected growth of 6.1 to 8.1 percent. The company has raised its annual revenue outlook after eking out a 1 percent rise in quarterly net income, due to the newer digital services that helped it get the contracts despite shrinking client budgets.
Meanwhile, Infosys is facing headwinds in its biggest market, the United States, as clients hold back technology spending amid concerns about President Donald Trump`s review of a visa programme for highly-skilled workers. Amid the restrictions, the company has announced it would hire 10,000 workers in the U.S. over the next two years. That is likely to raise costs since salaries for skilled engineers in India are far lower. Infosys` total headcount stood at 1.98 lakh at the end of June quarter and has added eight clients in the $100 million-plus category during the first quarter. Further, INFY in two years will establish four technology and innovation hubs in the U.S. The first will open in Indiana in August 2017 and the second hub will be opened in North Carolina.
In Q1, Infosys has continued to help clients drive automation and innovation into the core of their businesses leveraging the renewed traditional services, the new services in areas such as Cloud Ecosystem, Big Data and Analytics, API and Micro Services, Data and Mainframe Modernization, Cyber Security and IoT Engineering Services, and the software-led offerings, especially the next-generation Artificial Intelligence (AI) Platform Nia.
In April, the company has launched Infosys Nia, building on and accelerating, the work over the last 2.5 years to help clients embrace AI.