Infosys Ltd (NSE:INFY) surprised the market by posting 3.2% dollar revenue growth in Q2 2018 in September. It is the fastest growth in order by the second-largest technology (IT) services company in India in a year or more. The Q2 revenue of Infosys rose by 4.2% from the previous 3 months.
Currency fluctuations slow down Infosys revenue growth in Q2 2018
Fluctuations in currency, however, affected the growth of the company as the dollar revenue increased very slowly to $2.92 billion in the quarter ending on September 30. The company posted its last sequential dollar revenue growth for the June quarter in 2017. The net profit of the company increased to $581 million in the Q2 2018. Infosys reported a net profit of $578 million in the previous three months –FQ 2018. However, the operating margin for both June and September quarter remained constant at 23.7%.
According to reports, the orderly 4.7% growth from the clients in the financial services field helped Infosys to post a better than expected performance and revenue growth in Q2 2018. It ultimately led to 32.2% revenue. The company also posted an increase of 4.9% in business coming from retail clients and 17% revenue coming from accounting. The company won new deals worth more than $2 billion in this one quarter.
An analyst working at a foreign brokerage based in Mumbai said, “Both Tata Consultancy Services Limited (NSE:TCS) and Infosys have done well in the second quarter. But TCS has the edge over Infosys as they have been reporting a double-digit, year-on-year growth for three straight quarters. But a $2 billion in deal wins is encouraging.”
Major acquisitions by Infosys in Q2 2018
Infosys made some major acquisitions that contributed to its revenue growth in Q2 2018. On September 7, the wholly-owned subsidiary of the Indian IT company, Infosys Consulting Pte Limited acquired 60% stake in the Temasek Management Services’ wholly owned subsidiary Trusted Source. Temasek is an IT services company from Singapore. The two companies signed a deal of around $9 million.
Apart from that, Infosys Consulting acquired 100% voting interest in a Nordic-based consulting partner and salesforce advisor in the field of cloud consultation, implementation and training services, Fluido Oy. The Indian company signed a deal of around $75 million with this firm.