Q1 2025 Wipro Ltd Earnings Call
Operator: Ladies and Gentlemen, Good day and Welcome to Wipro Ltd.'s Q1 FY25 Earnings Conference Call As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touchtone phone.
Unknown Executive: Ladies and gentlemen, good day and welcome to Wipro Ltd Q1 FY25 earnings conference call. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should any assistance during the conference call, please signal an operator by pressing Star 10-0 on your touch-tone phone. Please note that this conference has been recorded.
Speaker Change: Ladies and gentlemen, good day and welcome to Wipro Ltd Q1 FY25 Earnings Conference Call. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes.
Speaker Change: Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touchtone phone.
Operator: Please note that this conference is being recorded. I now hand the conference over to Mr. Deepak Bohra, Senior Vice President, Corporate Treasurer, and Investor Relations. Thank you, and over to you, sir.
Deepak Bohra: I now have had the conference over to Mr. Deepak Bohra, Senior Vice President, Corporate Treasurer and Investor Relations.
Speaker Change: Please note that this conference is being recorded.
Dipak Bohra: I now hand the conference over to Mr. Deepak Bohra, Senior Vice President, Corporate Treasurer and Investor Relations. Thank you and over to you, sir.
Unknown Executive: Thank you, and over to you, sir. Thank you, Mr. Shree.
Dipak Bohra: Thank you, Yashashree. A warm welcome to our Quarter 1 Financial Year 25 earnings call. We will begin the call with the business highlights and overview by Srinivas Pallia, our Chief Executive Officer and Managing Director, followed by updates on the financial overview by our CFO Aparna Iyer. We also have our CRO Sourav Gohil on this call. Afterwards, the operator will open the bridge for Q&A with our management. Before Srinivas starts, let me draw your attention to the fact that during this call, we may make certain forward-looking statements within the meaning of the Private Security Litigation Reform Act of 1995. These statements are based on management's current expectations and are associated with uncertainties and risk, which may cause the actual results to differ materially from those expected. The uncertainties and risk factors are explained in our detailed filing with the SEC. Wipro does not undertake any obligation to update the forward-looking statements to reflect events and circumstances after the date of filing.
Srinivas Pallia: Warm welcome to our Quarter One financial year 25 earnings call. We will begin the call with the business highlights and overview by Senior Vice-Palya, our Chief Executive Officer and Managing Director. Followed by updates on financial overview by our CFO, Apparna Ayath. We also have our CHRO, Saurav Goal, on this call.
Dipak Bohra: Thank you, Ashutosh Sri.
Speaker Change: Warm welcome to our Quarter 1 Financial Year 25 earnings call. We will begin the call with the business highlights and overview by Srinivas Pallia, our Chief Executive Officer and Managing Director, followed by updates on financial overview by our CFO Aparna Iyer.
Unknown Executive: Afterwards, the operator will open the bridge for Q&A with our management team.
Speaker Change: We also have our CHRO Sourav Goel on this call. Afterwards, the operator will open the bridge for Q&A with our management team.
Unknown Executive: Before we start, let me draw your attention to the fact that during this call, we may make certain power-looking statements within the meaning of Private Security Litigation Reform Act 1995. These statements are based on management's current expectations and are associated with uncertainties and risk, which may cause the actual results to differ materially from those expected. The uncertainties and risk factor are explaining our detailed filing with the SEC. It does not undertake any obligation to update the forward-looking statements to reflect events and circumstances after the date of filing.
Speaker Change: Before Srinivas starts, let me draw your attention to the fact that during this call, we may make certain forward-looking statements within the meaning of Private Security Litigation Reform Act 1995
Speaker Change: These statements are based on management current expectations and are associated with uncertainties and risk, which may cause the actual results to differ materially from those expected. The uncertainties and risk factors are explained in our detailed filing with the SEC.
Speaker Change: Wipro does not undertake any obligation to update the forward looking statements to reflect events and circumstances after the date of filing.
Unknown Executive: The conference call will be archived, and a transcript will be available on our website.
Speaker Change: The conference call will be archived and a transcript will be available on our website. With that, I would like to turn over the call to Srini.
Srinivas Pallia: With that, I would like to turn over the call to Srini.
Srinivas Pallia: Thanks, Deepak.
Operator: The conference call will be archived, and a transcript will be available on our website. With that, I would like to turn over the call to Deepak. Thank you.
Srini: Thank you, Deepak.
Srinivas Pallia: Hello everyone. Thank you for joining me and my leadership team for our first quarter results for the financial year 2024-25. For this past 90 days, I have traveled across our markets, waiting clients, employees, and engaging with partners and stakeholders. With each conversation, my appreciation of our business has deepened, and my confidence in our team has grown stronger. It is truly inspiring to witness the trust our clients have placed in Vipro. Additionally, I have been able to hone the focus of our five strategic priorities that I shared with you last quarter.
Srinivas Pallia: Thank you for joining me and my leadership team for our first quarter results for the financial year 2024-2025. During these past 90 days, I have travelled across the market. Meeting clients, employees, and engaging with partners and stakeholders. [inaudible] My appreciation of our business has deepened, and my confidence in our team has grown stronger. Truly inspiring to witness the trust our clients have placed in Wipro. Additionally, I have been able to hone the focus of our five strategic priorities that I shared with you last quarter. I will provide you with an update on this shortly, but let me first start with the financial highlights for the quarter in question. We did not see a significant shift in the demand environment.
Srini: Thanks, Deepak. Hello, everyone.
Srini: Thank you for joining me and my leadership team for our first quarter results for the financial year 2024-25.
Srini: For these past 90 days, I have travelled across our markets, meeting clients, employees and engaging with partners and stakeholders.
Srini: With each conversation,
Srini: My appreciation of our business has deepened and my confidence in our team has grown stronger.
Srini: It's truly inspiring to witness the trust our clients have placed in Wipro.
Srini: Additionally, I have been able to hone the focus of our five strategic priorities that I shared with you last quarter.
Srinivas Pallia: I will provide you with an update on this shortly, but let me first start with the financial highlights for the quarter. In quarter one, we did not see a significant shift in the demand environment. Clients remain cautious, and our discretionary spending continued to be muted. Our IT services revenue for quarter one was $2.63 billion US, reflecting a sequential decrease of 1% in constant currency, which was written a guided range for the quarter. Srinivas Pallia, Srinivas Pallia, Amit Choudhary, Srinivas Pallia, Amit Choudhary, Srinivas Pallia, Amit Choudhary, Srinivas Pallia, Amit Choudhary, Srinivas Pallia, Amit Choudhary, Srinivas Pallia, Amit Choudhary, Srinivas Pallia, Amit Choudhary, Srinivas Pallia, Amit Choudhary, Srinivas Pallia, Srinivas Pallia, Amit Choudhary, Srinivas Pallia. We now see momentum in consumer and communication sectors also.
Srini: I will provide you with an update on this shortly.
Srini: But let me first start with the financial highlights for the quarter.
Srini: in Quarter 1
Srini: We did not see a significant shift in the demand environment.
Srinivas Pallia: Clients remain cautious, and our discretionary spending continues to be muted. Our IT services revenue for quarter one was... 2.63 billion US dollars, reflecting a sequential decrease of 1% in constant currency, which was within a guided range for the quarter. Operating Margin was 16.5%, an increase of 0.1% over the last quarter. Let me now provide you with some color on how our SMUs performed in Q1. I will begin with America's one, which delivered sequential growth of 0.4% in Q1.
Srini: Clients remain cautious and our discretionary spending continues to be muted.
Srini: Our IT services revenue for quarter 1 was...
Srini: 2.63 billion US reflecting a sequential decrease of 1% in constant currency which was within a guided range for the quarter.
Srini: Operating margin was 16.5% and increase of 0.1% over the last quarter.
Srini: Let me now provide you with some colour on how our SMUs performed in Q1.
Srini: and our
Srini: Industry sectors
Srini: I will begin with America's one.
Srini: which delivered a sequential growth of 0.4% in Q1.
Srinivas Pallia: You may recall that America's won had a good year in financial year 2024, with the health and technology sectors leading the way. We now see momentum in consumer and communication sectors also. America's 2 had a sequential decline of 0.7%. But BFSI performed well.
Srini: You may recall that America's won had a good year in financial year 2024 with the health and technology sectors leading the way.
Srini: We now see momentum in consumer and communication sectors also.
Srinivas Pallia: America's two had a sequential decline of 0.7%, but BFSI performed well, achieving a sequential growth of 1.4% in quarter one. With a year-on-year growth of 12.1% in quarter one, hookings in America's two, we are optimistic about returning to growth in this market in the medium term. In quarter one, we also maintain positive momentum in our capital business, achieving a sequential growth of 3.4%. However, Europe and Abmia remained soft for us, with sequential declines of 1.4% and 4.2%, respectively. Our pipeline in Europe remains healthy, and our primary focus day will be on improving conversion.
Srini: America's 2 had a sequential decline of 0.7%
Srinivas Pallia: Achieving a sequential growth of 1.4% in Q1, with a year-on-year growth of 12.1% in Q1. Bookings in Americas too, we are optimistic about returning to growth in this market in the medium term. In quarter one, we also maintained positive momentum in our Capco business, achieving a sequential growth of 3.4%. However, Europe and Apnea remained soft for us, with sequential declines of 1.4% and 4.2% respectively
Srini: But BFSI performed well, achieving a sequential growth of 1.4% in Q1
Srini: with a year-on-year growth of 12.1% in Q1.
Speaker Change: Cookings in America Stew
Speaker Change: We are optimistic about returning to growth in this market in the medium term.
Speaker Change: In Q1, we also maintained positive momentum in our Capco business, achieving a sequential growth of 3.4%.
Speaker Change: However, Europe and Apnea remained soft for us.
Speaker Change: with sequential declines of 1.4% and 4.2% respectively.
Srinivas Pallia: Our pipeline in Europe remains healthy, and our primary focus there will be on improving conversion. We are reviewing our strategy for APMEA and will keep you informed of our progress in the upcoming quarters. Among industry sectors, we had varied performance. Banking and Financial Services retained their positive momentum from last quarter, and we have now seen growth in this sector for two consecutive quarters. This sector grew 0.5% sequentially in Q1. Driven by deal flow, the consumer business grew by 1.6% this quarter. However, the manufacturing and energy, and nutritive sectors continue to show weakness for us.
Speaker Change: Our pipeline in Europe remains healthy and our primary focus there will be on improving conversion.
Srinivas Pallia: We are reviewing our strategy for Abmia and will keep you informed of our progress in upcoming quarters.
Speaker Change: We are reviewing our strategy for APMEA and will keep you informed of our progress in the upcoming quarters.
Srinivas Pallia: Among industry sectors, we had varied performance. Banking and financial services retained its positive momentum from last quarter, and we have now seen growth in this sector for two consecutive quarters. This sector grew 0.5% sequentially in quarter one. Given by deal flow, the consumer business grew by 1.6% this quarter. However, manufacturing and energy and utility sectors continue to show weakness for us, experiencing a sequential decline of 3% and 6.3%, respectively.
Speaker Change: Among industry sectors, we had varied performance.
Speaker Change: Banking and financial services retained its positive momentum from last quarter.
Speaker Change: and we have now seen growth in this sector for two consecutive quarters
Speaker Change: This sector grew 0.5% sequentially in Q1.
Speaker Change: Driven by deal flow, the consumer business grew by 1.6% this quarter.
Speaker Change: However, manufacturing and energy and utility sectors continue to show weakness for us experiencing sequential decline of 3% and 6.3% respectively.
Srinivas Pallia: Experiencing sequential declines of 3% and 6.3%, respectively. Moving to order booking, our overall bookings TCV for the quarter was 3.3 billion US with large deal TCV of 1.2 billion US. Now, let me update you on the progress we have made on the five strategic priorities that I outlined last quarter.
Srinivas Pallia: Moving to order booking, our overall booking for the quarter was 3.3 billion US, with a large deal of 1.2 billion US.
Speaker Change: Moving to order booking our overall bookings DCV for the quarter was
Speaker Change: 3.3 billion US with large deal TCV of 1.2 billion US
Srinivas Pallia: Now let me update you on the progress we have made on the five strategic priorities that I outlined last quarter. One, if you recall, we discussed prioritizing large deals as a clear area of focus. We are driving large deal creation systematically across our client base. todays. We are shaping these opportunities by proactively engaging with influences and partners. As a result, our pipeline for large deals remains robust. Once again, we had a quarter where our large deal bookings exceeded US$ 1 billion. Our success in securing 10 large deals in quarter one was a key factor that made this possible.
Speaker Change: Now let me update you on the progress we have made on the five strategic priorities that I outlined last quarter.
Srinivas Pallia: If you recall, we discussed prioritizing large deals as a clear area of focus. We are driving large deal creation systematically across our client base. We are shaping these opportunities by proactively engaging with influencers and partners. As a result, our pipeline for large deals remains robust.
Speaker Change: 1. If you recall, we discussed prioritizing large deals as a clear area of focus.
Speaker Change: We are driving large-scale creation systematically across our client base.
Speaker Change: We are shaping these opportunities by proactively engaging with influencers and partners.
Speaker Change: As a result, our pipeline for large deals remains robust.
Srinivas Pallia: Once again... We had a quarter where our large deal bookings exceeded US 1 billion. Our success in securing 10 large deals in Q1 was a key factor that made this possible. Let me call out two of the deals that we signed in quarter one. The first is with a US-based communication services provider, where we were chosen for a five-year contract. To provide managed services for select products and build industry-specific solutions. You may have already heard about this in the media.
Speaker Change: Once again.
Speaker Change: We had a quarter where our large deal bookings exceeded US 1 billion.
Speaker Change: Our success in securing 10 large deals in Q1 was a key factor that made this possible.
Srinivas Pallia: Let me call out two of the deals that we signed in Quarter One. The first is with a US-based communication services provider, where we were chosen for a five-year contract to provide managed services for select products and building industry specific solutions. You would have already heard about this in the media. The second win is in the automotive segment in manufacturing. A US-based OEM has selected us to streamline the global infrastructure services. We will develop a solution leveraging both automation and AI to improve user experience and reduce operating costs. 2. Our next area of focus, which I have called out, is to strengthen our relationships with our major clients and strategic partners.
Speaker Change: Let me call out two of the deals that we signed in quarter one.
Speaker Change: The first is with a U.S. based communication services provider.
Speaker Change: where we were chosen for a five-year contract.
Speaker Change: To provide managed services for select products and building industry-specific solutions.
Speaker Change: You would have already heard about this in the media.
Srinivas Pallia: The second... is in the automotive segment in manufacturing. A US-based OEM has selected us to streamline the Global Infrastructure Services. We will develop a solution leveraging both automation and AI to improve user experience and reduce. Operating Cost, Number two, our next area of focus, which I had called out. Sourav Kumar, Srinivas Palli, Gaurav Rateria, Yogesh Aggarwal, Girish Pallia, Gaurav Rateria. We are investing in our established strategic accounts and high-potential accounts. Our focus will be on these clients within our priority sectors and markets we have defined internally.
Speaker Change: The second win is in the automotive segment in manufacturing.
Speaker Change: A US-based OEM has selected us to streamline their global infrastructure services.
Speaker Change: We will develop a solution leveraging both automation and AI to improve user experience and reduce cost.
Speaker Change: Operating Cost
Speaker Change: Number 2, our next area of focus, which I had called out.
Speaker Change: is to strengthen our relationships with our major clients and strategic partners.
Srinivas Pallia: We are investing in our established strategic accounts and high potential accounts. Our focus will be on these clients within our priority sector and markets. We have defined internally. We will further strengthen our capabilities in consulting, delivery, and solutioning in these accounts. In addition, we are actively collaborating with hyperskillers and strategic partners to co-innovate and develop unique propositions for our clients. In fact, I would like to emphasize that even in an otherwise soft demand environment, revenue from top 10 accounts have grown 1.3 percent sequentially and 3.8 percent year-on-year in constant currency terms. Another key priority I have previously highlighted is to develop AI-powered industry and cross-industry solutions using a consulting-led approach.
Speaker Change: We are investing in our established strategic accounts and high potential accounts.
Speaker Change: Our focus will be on these clients within our priority sectors and markets we have defined internally.
Srinivas Pallia: We will further strengthen our capabilities in consulting, delivery, and solutioning on these accounts. In addition... We are actively collaborating with hyperscalers and strategic partners. Co-Innovate and Develop Unique Propositions for our Clients. In fact, I would like to emphasize that even in an otherwise soft demand environment, our revenue from top 10 accounts has grown 1.3% sequentially and 3.8% year-on-year in constant currency terms. Another key priority I had previously highlighted is to develop AI-powered industry and cross-industry solutions. Using a Consulting-Led Approach, Clearly, our goal here is to help clients transform their business and operating models using the power of AI.
Speaker Change: We will further strengthen our capabilities in consulting, delivery and solutioning in these accounts.
Speaker Change: In addition, we are actively collaborating with hyperscalers and strategic partners
Speaker Change: to co-innovate and develop unique propositions for our clients.
Speaker Change: In fact, I would like to emphasize that even in an otherwise soft demand environment, our revenue from top 10 accounts have grown 1.3% sequentially and 3.8% year-on-year in constant currency terms.
Speaker Change: Another key priority I had previously highlighted is to develop AI-powered industry and cross-industry solutions using a consulting-led approach.
Srinivas Pallia: Clearly, our goal here is to help clients transform their business and operating models using the power of AI. We are also actively strengthening and accelerating our industry consulting capabilities to support this. We continue to build cross-industry solutions that will deliver value to clients across our horizontal plays.
Speaker Change: Clearly, our goal here is to help clients transform their business and operating models using the power of AI.
Srinivas Pallia: We are also actively strengthening and accelerating our industry consulting capabilities to support this. We continue to build cross-industry solutions that will deliver value to clients across our horizontal planes. Let me give you two examples of our recent wins in quarter one.
Speaker Change: We are also actively strengthening and accelerating our industry consulting capabilities to support this.
Speaker Change: We continue to build cross-industry solutions that will deliver value to clients across our horizontal plays.
Srinivas Pallia: Let me give you two examples of our recent wins in quarter one. In the healthcare sector, we have been selected by a leading US-based health solutions company to help them comply with CMS guidelines. Our consulting-led AI-powered industry solution will seamlessly integrate CMS provisions into billing and various other processes. This will simplify prescription cost management for all the members. Moving on to the second example, we are collaborating with a leading financial services company in North America to develop a GNAI-powered assistant for wealth management to help portfolio advisors.
Speaker Change: Let me give you two examples of our recent wins in quarter one.
Srinivas Pallia: In the healthcare sector, we have been selected by a leading US-based health solutions company to help them comply with CMS guidelines. A consulting-led, AI-powered industry solution will seamlessly integrate CMS provisions into billing and various other processes. This will simplify prescription cost management for all the members.
Speaker Change: In the healthcare sector, we have been selected by a leading US-based health solutions company to help them comply with CMS guidelines.
Speaker Change: A consulting-led, AI-powered industry solution will seamlessly integrate CMS provisions into billing and various other processes.
Speaker Change: This will simplify prescription cost management for all the members.
Srinivas Pallia: Moving on to the second example, we are collaborating with a leading financial services company in North America to develop a JNAI powered assistant. Let me now shift to our next area of focus, which is building talent at scale. Our goal at Wipro is to attract, nurture, and grow a diverse talent pool. We have ramped up our upskilling efforts across various practices, covering both emerging and core technology areas. In fact, during quarter one, we rolled out iAspire, an AI-powered career development platform. iAspire offers personalized learning pathways and AI-based guidance in the career progression for each and every one of our employees.
Speaker Change: Moving on to the second example
Speaker Change: We are collaborating with a leading financial services company in North America.
Speaker Change: to develop a JNAI powered assistant.
Speaker Change: for Wealth Management
Speaker Change: to help portfolio advisors.
Srinivas Pallia: Let me now shift to our next area of focus, which is building talent at scale. Our goal at Wipro is to attract, nurture, and grow a diverse talent pool. We have ramped up our upskilling efforts across various practices covering both emerging and core technology areas. In fact, during quarter one, we rolled out ISPAR and AI-powered career development platform. ISPAR offers personalized learning pathways and aids in the career progression for each and every one of our employees. We have already provided foundational trainings to over 225,000 of our employees, and an additional 30,000 employees have received advanced AI training.
Speaker Change: Let me now shift to our next area of focus.
Speaker Change: which is building talent at scale.
Speaker Change: Our goal at Wipro is to attract, nurture and grow a diverse talent pool.
Speaker Change: We have ramped up our upskilling efforts across various practices, covering both emerging and core technology areas.
Speaker Change: In fact during quarter one
Speaker Change: We rolled out iAspire, an AI-powered career development platform.
Speaker Change: iASPIRE offers personalized learning pathways and aids in the career progression for each and every one of our employees.
Srinivas Pallia: We have already provided foundational training to over 225,000 of our employees, and then additional 30,000 employees have received advanced AI training. With Wipro as client zero, we are utilizing our in-house AI expertise to develop JNAI solutions across all units and functions within the company.
Speaker Change: We have already provided foundational training to over 225,000 of our employees and an additional 30,000 employees have received advanced AI training.
Srinivas Pallia: With Wipro as client zero, we are utilizing our in-house AI expertise to develop GNAI solutions across all units and functions within the company. We believe this will help us boost not only the capabilities of our employees, but also make Wipro GNAI ready.
Speaker Change: With Wipro as client zero
Speaker Change: We are utilizing our in-house AI expertise.
Speaker Change: to develop JNAI solutions across all units and functions within the company.
Srinivas Pallia: This will help us boost not only the capabilities of our employees but also make Wipro JNI ready. And finally... We are driving Execution Rigor with Speed, Helping client Centricity and delivery excellence. We are focused on nurturing innovation in our delivery capabilities by investing in our Lab45 AI platform and the Wipro Enterprise Gen AI Studio. In fact, we are also incorporating various GNI tools throughout our software development life cycle to enhance both the productivity and quality of our delivery. In closing, I would like to see this. The initial climb is both challenging and exciting.
Speaker Change: We believe this will help us boost not only the capabilities of our employees but also make Wipro Gen AI ready.
Srinivas Pallia: And finally, we are driving execution rigor with speed, helping client centricity and delivery excellence. We have focused on nurturing innovation in our delivery capabilities by investing in our Lab 45 AI platform and the Wipro Enterprise GNAI Studio. In fact, we are also incorporating various GNAI tools throughout our software development life cycle to enhance both the productivity and quality of our delivery.
Speaker Change: And finally...
Speaker Change: We are driving
Speaker Change: Execution Rigor with Speed
Speaker Change: Helping Client Centricity and Delivery Excellence
Speaker Change: We are focused on
Speaker Change: Nurturing Innovation in our Delivery Capabilities
Speaker Change: by investing in our Lab45 AI platform.
Speaker Change: and the Wipro Enterprise JNAI Studio.
Speaker Change: In fact, we are also incorporating various GNI tools throughout our software development life cycle.
Speaker Change: To enhance both the productivity and quality of our delivery.
Srinivas Pallia: In closing, I would like to say this: the initial climb is both challenging and exciting. I am pleased with the momentum we have built in Quarter One. Across the company, I have noticed a fresh energy and renewed dedication towards achieving our goals. With the commitment and passion of our 230,000 plus employees across the world, I firmly believe we will seize market opportunities, bad offers, and will continue to progress steadily one step at a time.
Speaker Change: In closing, I would like to say this.
Speaker Change: The initial climb is both challenging and exciting.
Srinivas Pallia: I am pleased with the momentum we have built in quarter one across the company. I have noticed a fresh energy and renewed dedication to achieving our goals, with the commitment and passion of our 230,000 plus employees across the world. I firmly believe we will seize market opportunities ahead of us and will continue to progress steadily, one step at a time.
Speaker Change: I am pleased with the momentum we have built in quarter one.
Speaker Change: across the company.
Speaker Change: I have noticed a fresh energy and renewed dedication towards achieving our goals.
Speaker Change: With the commitment and passion of our 230,000 plus employees across the world, I firmly believe we will seize market opportunities ahead of us and will continue to progress steadily.
Srinivas Pallia: Now, I want guidance. As we move into quarter two, we do believe that we are now in a better position compared to the start of quarter one. for Kota 2, we are guiding for a sequential revenue growth of minus 1.0% to plus 1.0% in constant currency. We are confident that we can sustain our margins within a narrow bank with an upward bias in the coming quarters.
Srinivas Pallia: Now on to guidance. As we move into quarter... We do believe that we are now in a better position compared to the start of quarter one. We are guiding for a sequential revenue growth of minus 1.0 percent.
Speaker Change: One step at a time.
Speaker Change: Now on to guidance.
Speaker Change: As we move into quarter 2, we do believe that we are now in a better position compared to the start of quarter 1.
Speaker Change: [inaudible]
Speaker Change: We are guiding for a sequential revenue growth of minus 1.0% to plus 1.0% in constant currency.
Srinivas Pallia: We are confident that we can sustain a marginalized economy with an upward bias in the coming quarters. With that, I will turn it over to Aparna for a detailed overview of our financial plan. Thank you. Oh, to you, Aparna. Thank you, Shami.
Speaker Change: We are confident that we can sustain our margins.
Speaker Change: [inaudible]
Speaker Change: with an upward bias in the coming quarters.
Aparna Iyer: With that, let me turn it over to Aparna for a detailed overview of our financials.
Speaker Change: With that...
Speaker Change: Let me turn it over to Aparna for a detailed overview of our financials.
Aparna Iyer: What are you, Aparna? Thank you, Shaini. Hello, everybody.
Speaker Change: Thank you. O to you Aparna.
Aparna Iyer: Hello everybody. Let me quickly summarize the financial highlights for Q125, after which we can open it up for questions. Variety services revenues declined 1.2% sequentially in reported currency terms, which is a 1% decline in constant currency terms.
Aparna Iyer: Let me quickly summarize the financial highlights for Q125, post which we can open it up for questions. Variety services revenues decline 1.2% sequentially in reported currency terms, which is a 1% decline in constant currency terms. This is well within our guided range for Q1. We are also pleased to share an expansion in our IT services margins of 0.4% year on year and 0.1% quarter on quarter. We deliver 16.5% margins on the back of a tough revenue environment, and even after continuous investments in talent, improved utilization, fixed price productivity, and optimization of overheads have been the key levers at play.
Aparna Iyer: Thank you, Shami.
Aparna Iyer: Hello everybody. Let me quickly summarize the financial highlights for Q125, post which we can open it up for questions.
Aparna Iyer: Variety services revenues declined 1.2% sequentially in reported currency terms, which is a 1% decline in constant currency terms.
Aparna Iyer: This is well within our guided range for Q1. We are also pleased to share an expansion in our IT services margins of 0.4% year on year and 0.1% quarter on quarter. We deliver 16.5% margins on the back of a tough revenue environment and even after continuous investments in talent. Improved Utilization, Fixed Price Productivity, and Optimization of Overheads have been the key levers at play. We expect to gain from the tailwinds of our operational rigor and are confident of being able to operate in a narrow band with an upward bias.
Aparna Iyer: This is well within our guided range for Q1.
Aparna Iyer: We are also pleased to share an expansion in our IT services margins of 0.4% year on year and 0.1% quarter on quarter.
Aparna Iyer: We deliver 16.5% margins on the back of a tough revenue environment and even after continuous investments in talent.
Aparna Iyer: Improved Utilization, Fixed Price Productivity and Optimization of Overheads have been the key levers at play.
Aparna Iyer: We expect to gain from the tailwinds of our operational rigor and are confident of being able to operate in a narrow bank with an upward bias.
Aparna Iyer: We expect to gain from the tailwinds of our operational rigor and are confident of being able to operate in a narrow band with an upward bias.
Aparna Iyer: We generate yet another quarter of strong cash flows. A cash flows of $479 million in Q1 is at 132% of our net income. With this, our current investments and cash balance now stands at $5.4 billion. Our other income net of finance expenses grew by 21% quarter-on-quarter and year-on-year. Our accounting yields for average investments held in India in Q1 was at 7.6%. Our net income at our 30 billion grew 6% sequentially, and our EPS for the quarter at 5.75 rupees grew 10% year on year. In terms of other key matrices, our ETR is at 24.5% for Q1 versus 24% in Q1 24.
Aparna Iyer: We generated yet another quarter of strong cash flow. Our cash flows of $479 million in Q1 are at 132% of our net income. With this, our current investments in cash balance now stands at $5.4 billion. Our other income, net of finance expenses, grew by 21% quarter on quarter and year on year. Our accounting yield for average investments held in India in Q1 was at 7.6%.
Aparna Iyer: We generated yet another quarter of strong cash flows.
Aparna Iyer: Our cash flows of $479 million in Q1 is at 132% of our net income. With this, our current investments and cash balance now stands at $5.4 billion.
Aparna Iyer: Our other income, net of finance expenses, grew by 21% quarter on quarter and year on year.
Aparna Iyer: Our accounting yield for average investments held in India in Q1 was at 7.6%.
Aparna Iyer: Our net income, at INR 30 billion, grew 6% sequentially, and our EPS for the quarter, at Rs 5.75, grew 10% year on year. In terms of other key matrices, our ETR is at 24.5% for Q1 versus 24% in Q1-24. Our hedges continue to be in line with our policies.
Aparna Iyer: Our net income at INR 30 billion grew 6% sequentially and our EPS for the quarter at Rs 5.75 grew 10% year on year.
Aparna Iyer: In terms of other key matrices, our ETR is at 24.5% for Q1 versus 24% in Q1-24. Our hedges continue to be in line with our policy.
Aparna Iyer: Our hedges continue to be in line with our policy. We are about $3 billion of forest derivative contracts as hedges at the end of Q1.
Aparna Iyer: We had about $3 billion of forex derivative contracts as hedges at the end of Q1. Finally, I would like to reiterate the guidance for Q1. We expect revenues from our IT services business segment to be in the range of 2.6 billion to 2.652 billion dollars. This translates to a sequential guidance of minus 1% to plus positive 1% in constant currency terms.
Aparna Iyer: We are about $3 billion of forex derivative contracts as hedges at the end of Q1.
Aparna Iyer: Finally, I would like to reiterate the guidance for Q1. We expect revenues from our IT services business segment to be in the range of $2.6 billion to $2.652 billion. This translates to a sequential guidance of minus 1% to a plus positive 1% in constant currency terms. With that, we can open up for Q&A.
Aparna Iyer: Finally, I would like to reiterate the guidance for Q1.
Aparna Iyer: We expect revenues from our IT services business segment to be in the range of $2.6 billion to $2.652 billion. This translates to a sequential guidance of minus 1% to a plus positive 1% in constant currency terms.
Operator: We can open up for Q&A. Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and 1 on the touchtone telephone. If you wish to remove yourself from the question queue, you may press star and 2.
Speaker Change: With that, thank you for joining us. We will be back in just a moment.
Unknown Executive: Thank you very much.
Speaker Change: We can open up for Q&A.
Unknown Executive: We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touchtone telephone. Ramun, if you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue is finished.
Speaker Change: Thank you very much.
Speaker Change: We will now begin the question and answer session. Anyone who wishes to ask a question may press star and 1 on their touchtone telephone.
Speaker Change: If you wish to remove yourself from the question queue, you may press star and 2.
Operator: Participants are requested to use their handsets while asking a question. Ladies and Gentlemen, we will wait for a moment while the question queue assembles. We have a first question from the line of Abhishek Bhandari from Namoda. Please go ahead.
Speaker Change: Participants are requested to use handsets while asking a question.
Speaker Change: Ladies and Gentlemen, we will wait for a moment while the question queue assembles.
Abhishek Bandari: We have a first question from the line of Abhishek Bandari from Nomura. Please go ahead. Thank you. Good evening, Shini. Shini, my first question is, you know, on the, you know, the quarter gone by, you know, most of the peers who have reported were no kind of positively surprised by the execution during the quarter, while we have, you know, reported a number which is within the band, but it's worth the lower end.
Speaker Change: We have a first question from the line of Abhishek Bhandari from Namoda. Please go ahead.
Abhishek Kumar: Thank you. Good evening, Srini. Srini, my first question is, you know, on the quarters gone by, most of the peers who have reported were, you know, kind of positively surprised by the execution during the quarter, while we have, you know, reported a number which is within the band, but it's towards the lower end. So, was there any incident in terms of, you know, negative surprises for you, or do you think your Q1 performance was in line with what you Thanks, Abhishek. Hello. You know, Abhishek, the first point I want to talk about is that we did give a quarter one guidance range, and we were within that guidance range. That's number one.
Abhishek Kumar: Thank you. Good evening, Srini. Srini, my first question is, you know, on the, you know, the quarter gone by, you know, most of the peers who have reported were, you know, kind of positively surprised by the execution during the quarter.
Abhishek Kumar: [inaudible]
Abhishek Bandari: So, what are any, you know, incidents in terms of, you know, negative surprises for you, or you think your Q1 performance was in line with what you had anticipated at the start of the quarter?
Srinivas Pallia: Second, like I said, we're still not seeing a significant change in the demand environment. You know, we see clients are still cautious, and discretionary spend is low. However, we have seen an uptick in Capco, BFSI, and consumer business in the US, which I called out. However, sectors like E&U and manufacturing have been soft for us. Outside of the US, we are yet to see momentum build up in our other two SMUs, specifically Europe and APNIA.
Srinivas Pallia: Thanks, Abhishek, hello.
Srinivas Pallia: You know, Abhishek, the first point I want to talk about is, we did I give a quarter one guidance range and we were within that guidance range, that's number one. Second, like I said, we're still not seeing a significant change in the demand environment. You know, we see clients still cautious, and discretionary spend is low. However, we have seen an uptick in Capco, BFSI, and consumer business in the US, which I called out. Sectors like ENU and manufacturing has been soft for us. Outside of the US, we are ready to see momentum build up in our other two SMUs, specifically Europe and Armenia.
Srini: Thanks Abhishek. Hello.
Srini: You know Abhishek, the first point I want to talk about is, we did give a quarter one guidance range and we were within that guidance range.
Srini: That's number one. Second, like I said, we're still not seeing a significant change.
Srini: In the demand environment, we see clients still cautious and discretionary spend is low. However, we have seen uptick in Capco, BFSI, consumer business in the US, which I called out.
Srini: Sectors like E&U and manufacturing have been soft for us.
Srini: Outside of the US, we are yet to see momentum build up in our other two SMUs, specifically Europe and APNIA.
Srinivas Pallia: We are also still in the early stage of the deal that we have signed, and deals like this usually take a few quarters to realize their full potential, and that's where a quarter to guidance is between minus one to plus one percent. Got it. Thanks, Srini.
Srinivas Pallia: We are also still in early stage of the deal that we have signed, and deals like this usually take few quarters to realize its full potential, and that's where our quarter two guidance is between minus one to plus one percent.
Srini: We are also still in early stage of the deal that we have signed and deals like this usually take few quarters to realize its full potential and that's where our quarter 2 guidance is between minus 1 to plus 1 percent.
Unknown Executive: You got it.
Abhishek Kumar: My second and last question is, you know, on the telco deal, what you want in Q1. Is it due for a full ramp-up in Q2, or will there be a staggered ramp-up between Q2 and Q3? Abhishek, like Srini said, these deals typically take some time to ramp up, and it will take a few quarters for it to realize its full revenue potential. Of course, some upside is factored in the quarter two guidance. Thank you. Thank you, Aparna, and thank you, Srini, and all the best.
Unknown Executive: Thanks, Shini.
Abhishek Bandari: My second and last question is on the telco deal. What is one in Q1? Is it new due for full ramp up in Q2 or there will be a staggered ramp up between Q2 and Q3?
Speaker Change: Got it. Thanks Srini. My second and last question is, you know, on the telco deal, what you want in Q1. Is it due for full ramp-up in Q2 or there will be a staggered ramp-up between Q2 and Q3?
Aparna Iyer: Yeah, Abhishek, like Shini said, these deals typically take some time to ramp up, and it will take a few quarters for it to realize its full revenue potential. Of course, some outside is factored in the quarter two guidance. Good.
Speaker Change: Yeah, Abhishek, like Srini said, these deals typically take some time to ramp up and it'll take a few quarters for it to realize its full revenue potential. Of course, some upside is factored in the quarter two guidance.
Unknown Executive: Thank you. Thank you for that.
Unknown Executive: Thank you, Shini, and all the best. Thank you.
Speaker Change: Thank you, thank you Aparna and thank you Srini and all the best. Thank you. Thank you.
Gaurav Ratheria: Next question is from the line of Gaurav Ratheria from Morgan Stanley. Please go ahead. Hi. Thanks for taking my question. Shrimi, first question is on deal wins.
Operator: Thank you. Thank you. Thank you. The next question is from the line of Gaurav Rateria from Morgan Stanley. Please go ahead.
Speaker Change: Next question is from the line of Gaurav Rateria from Morgan Stanley . Please go ahead.
Gaurav Rateria: Hi, thanks for taking my question. Srini, my first question is on deal wins. Would you be able to provide some color on how average tenor has changed versus the last few quarters? And also, has there been any change in the new versus renew mix in the current quarter versus the last few quarters?
Gaurav Rateria: Hi, thanks for taking my question. Srini, first question is on deal wins. Would you be able to provide some color on
Gaurav Ratheria: Would you be able to provide some color on how average tenor has changed versus the last few quarters? And also, has there been any change in the new versus renew mix in the current quarter versus the last few quarters?
Gaurav Rateria: How average tenor has changed versus last few quarters and also has there been any change in the new versus renew mix in the current quarter versus last few quarters
Aparna Iyer: You know, I'll go first and then Srini, you know, you can add, see, we don't share that mix between new versus renewal, but you know that the large deal that we had announced was net new, so that should give you some color on your point on tenure of deal wins. We do see that the tcv bookings, um, you know, continue to be signed for longer tenure. Some of it is also, you know So just to add to that, hi Gaurav, deal tenures are definitely becoming shorter. Three-year to five-year deals are becoming more commonplace. The only deals where 10 years exceed 5 years include optionalities, and clients agree only when cost savings are front-loaded with potentially financial engineering involved.
Aparna Iyer: I'll go first, and then, Shini, you can add. See, we don't share that mix between new versus renewal, but you know that the large yield that we had announced was net new, so that should give you some color. On your point on tenor of deal wins, we do see that the TCV bookings continue to be signed for longer tenor.
Speaker Change: [inaudible]
Srini: but you know that the large deal that we had announced was you know net new so that should give you some color
Speaker Change: On your point on tenure of the ILWINS,
Speaker Change: We do see that the TCV bookings, you know, continue to be signed for longer tenures. Some of it is also, you know, a portfolio of what we went, but that continues to go up.
Aparna Iyer: Humphrey is also, you know, a portfolio of what we went, but that continues to go up.
Speaker Change: It's something that we've noticed, Gaurav.
Gaurav Ratheria: Arun Panwar, Srinivas Arun Panwar, Srinivas Arun Panwar, Srinivas Arun Panwar, Srinivas Arun. How are you thinking about implementing GenAI in your internal software development from a delivery point of view, and could you share some color on initial results that you might have seen across different service lines? Thanks, Gaurav. GenAI is very exciting, and from my perspective, there are three ways where we are deploying GenAI. First number one, like I said, as Vipro is applying zero, we are actually implementing Genai across various process areas within Vipro across all the units. In fact, we are helping, for example, in the HR segment, the whole employee experience, if you will.
Speaker Change: So just to add to that, hi Gaurav, deal tenures are definitely becoming shorter, three year to five year deals are becoming more commonplace.
Speaker Change: The only deals where 10 years exceed 5 years includes optionalities and clients agree only when cost savings are front-loaded with potentially financial engineering involved.
Gaurav Rateria: Got it. The second question is how you are thinking about implementing GenAI in your internal software development from a delivery point of view, and could you share some color on the initial results that you might have seen across different service lines? Thanks, Gaurav. GNI is very exciting, and from my perspective, there are three ways we are deploying GNI. First, number one, like I said, as Wipro is a client zero, we are actually implementing GNI across various process areas within Wipro, across all the units.
Gaurav: Got it. Second question is on how are you thinking about implementing GenAI in your internal software development from a delivery point of view and could you share some color on initial results that you might have seen across different service lines?
Speaker Change: Thanks Gaurav and all.
Speaker Change: JNAI is very exciting and from my perspective
Speaker Change: There are three ways where we are deploying Gen-AI. First, number one, like I said, as Wipro is at client zero, we are actually implementing Gen-AI across various processes.
Srinivas Pallia: In fact, we are helping, for example, in the HR segment, the whole employee experience, if you will. Second, the I-Aspire that I talked about, we launched it. It's about how you build a career for our employees. They define what career path they want to take and what kind of... [inaudible] Second, Gaurav, is that, you know, in fact, if I have to really talk about some examples, you know, one of the things that we have done is WeNow. It's actually a conversational digital assistant for, you know, interacting with the various corporate systems. As of today, we had almost 7.4 million queries resolved in IT, HR, and Policy, and it has almost touched 230K users.
Speaker Change: Process areas within Wipro across all the units.
Speaker Change: In fact, we are helping, for example, in the HR segment, the whole employee experience, if you will.
Srinivas Pallia: Second, the ISPAR that I talked about, we launched. It's about how do you build careers for our employees? They define what careers they want part, they want to take and what kind of training programs that we can apply to them in the context of Genai. So those are the things that we are already doing, and this is also helping our teams build more capabilities and competences in Genai. It's also helping Vipro to be a truly a Genai already company. Second, Gaurav, in fact, if I have to really talk about some examples, one of the things that we have done is V now.
Speaker Change: Second, the I Aspire that I talked about we launched. It's about how do you build careers for our employees. They define what careers they want, what path they want to take and what kind of
Speaker Change: Training Programs that we can apply to them in the context of Gen-AI
Speaker Change: So those are the things that we are already doing and this is also helping our teams kind of build more capabilities and competencies in JNAI. It's also helping Wipro to be really and truly a JNAI ready company.
Speaker Change: [inaudible]
Srinivas Pallia: It's actually a conversation and digital assistant of interacting with the various corporate systems. As of today, we are almost 7.4 million queries resolved in IT, HR, and policy. And it has almost touched, I think, two or a half etiquette users. What excites me is the fact that 80% favorability rating from our employees; that actually is significant. Another one which I'm really excited about is Elisa, which is AI Power Sales Assistant, which is supporting almost 3000 sales force across the group for us. So there are multiple, what I would say, GenAI-related solutions that we are implementing within Vipro.
Speaker Change: As of today, we had almost 7.4 million queries resolved in IT, HR and Policy and it has almost touched 230K users. What excites me
Srinivas Pallia: What excites me is the fact that we have an 80% favorability rating from our employees; that actually is significant. Another one which I'm really excited about is Elisa, which is an AI-powered sales assistant that is supporting almost 3,000 sales forces across the globe for us. So there are multiple, what I would say, Gen-AI-related solutions that we are implementing within Wipro. I tell people that you've got to drink your Kool-Aid first, and I'm very excited that employees are bringing so much out there with Gen-AI. As far as clients are concerned, Gaurav, there are three components to it. How do we deploy JNAI in the context of the software development life cycle? Right, you know, we've all heard of GitHub co-pilot.
Speaker Change: It's a fact that 80% favorability rating from our employees.
Speaker Change: that actually you know is significant another one which
Speaker Change: I am really excited about is Eliza, which is AI powered sales assistant, which is supporting almost 3000 sales force across the globe for us. So there are multiple, you know.
Speaker Change: What I would say, GNI related solutions that we are implementing within Wipro, I tell people that you know you got to drink your Kool-Aid first and I'm very excited that employees are you know bringing in so much so much out there with the GNI
Srinivas Pallia: So I tell people that you've got to drink your cold late first, and I'm very excited that employees are bringing in so much out there with the Genai.
Srinivas Pallia: As for the clients that are concerned, Gaurav, there are three components to it. One is, how do we deploy Genai in the context of software, dollop, and life cycle? We all heard of GitHub Copilot. So how do you not only improve the productivity but also improve the quality? In that, if you ask me both on the coding side and also on the testing side. And this to me, Gaurav, it will continue to improve as we move forward. And there is an excitement across our clients and our own employees deploying this. So thereby, we can improve the productivity and quality.
Speaker Change: As far as the clients are concerned, Gaurav, you know, there are three components to it. One is...
Gaurav: How do we deploy JNAI in the context of software development lifecycle?
Srinivas Pallia: So how do you not only improve productivity but also improve quality? In that, you know, if you ask me, both on the coding side and also on the testing side. And this, Gaurav, you know, it will continue to improve as we move forward, and there is excitement across our clients and our own employees deploying this. So thereby, you know, we can improve productivity and quality. The second part is, how do you infuse JNI into managed services?
Gaurav: We all heard of GitHub Copilot. So how do you not only improve the productivity but also improve the quality?
Gaurav: In that you know if you ask me both on the coding side and also on the testing side and this to me Gaurav you know it is it will continue to improve as we move forward and there is an excitement across our clients and our own employees deploying this so thereby you know we can improve the productivity and quality
Srinivas Pallia: The second part is how do you infuse Genai into managed services, both on the infrastructure side and also on the process side? I think that's one area that we are constantly looking at and how can we leverage Genai against from a productivity and also experience for our clients.
Gaurav: The second part is how do you infuse JNAI into managed services?
Srinivas Pallia: Both on the infrastructure side and also on the process side. I think that's one area that you know we are constantly looking at and how can we leverage JNAY again from a productivity and also experience for our clients. The third piece, Gaurav, what we are trying to do, like I talked about the industry solutions, cross-industry solutions that we are building, right? I talked about telecom, I talked about the OEM, manufacturing, I talked about healthcare, and I also talked about wealth management in the context of financial services.
Speaker Change: Both on the infrastructure side and also on the process side. I think that's one area that you know we are constantly looking at and how to how can we leverage Genai again from a productivity and also experience for our clients.
Srinivas Pallia: The third piece, Gaurav, what we are trying to do, like I talked about the industry solutions, cross-industry solutions that we are building, right? I talked about the telecom, I talked about the OEM manufacturing, I talked about healthcare, I also talked about wealth management in the context of financial services. These are all AI-pervert industry solutions, which are consulting-led. So, combination of knowing the domain aspects of the client, understand the technology landscape of the client becomes very critical and more so, data. So, we are also able to help the clients in the context of their entire data strategy, data governance and how do you leverage the enterprise data within a reliable and secure way and implement GenAI.
Speaker Change: The third piece, Gaurav, what we are trying to do...
Gaurav: Like I talked about the industry solutions, cross-industry solutions that we are building, right? I know I talked about the telecom. I talked about the OEM, you know, manufacturing. I talked about health care. I also talked about, you know, wealth management in the context of financial services.
Srinivas Pallia: These are all AI-powered industry solutions which are consulting-led. So the combination of knowing the domain aspects of the client, and understanding the technology landscape of the client becomes very critical, and more so data. So we are also able to help the clients in the context of their entire data strategy, data governance, and how do you leverage enterprise data in a reliable and secure way and implement GNI. And I feel very excited because of the deals that we have won. And now we are out there to execute them.
Gaurav: These are all AI powered.
Gaurav: So combination of knowing the domain aspects of the client, understand the technology landscape of the client becomes very critical and more so data.
Gaurav: So, we are also able to help the clients in the context of their entire
Speaker Change: Data strategy, data governance and how do you leverage the enterprise data within a reliable and secure way and you know implement GNI and I feel very excited because of the deals that we have won and now we know we are we are out there to execute them and some of these can be replicated across Gaurav
Srinivas Pallia: And I feel very excited because of the deals that we have won, and now we are out there to execute them, and some of these can be replicated across Gaurav.
Aparna Iyer: And some of these can be replicated across Gaurav. Thank you for the very detailed answer. Last question for Aparna, what has been driving the depreciation and amortization down for the last two quarters, and you did talk about margin in a narrow band with an upward bias. So what would be the levers going forward?
Aparna Iyer: Last question for Apparna: what has been driving the deprecation and amortization down for the last two quarters? And you did talk about margin in an arrow band with an upward bias. So, what would be the levers going forward? Thank you very much. I think, you know, the deprecation and amortization expense doesn't really have anything that's very particular for me to call out. Perhaps a couple of quarters back, we may have had some acceleration of amortization of a particular intangible, but other than that, I don't think that I need one off to call out, you know, for Q1.
Aparna Iyer: Thank you for the very detailed answer. Last question for Aparna, what has been driving the depreciation and amortization down for last two quarters and you did talk about
Aparna Iyer: Margin in a narrow band with an upward bias. So what would be the levers going forward? Thank you very much.
Aparna Iyer: Thank you very much. I think, you know, the depreciation amortization expense doesn't really have anything that's very particular for me to call out. Perhaps a couple of quarters back, we may have had some acceleration of the amortization of a particular intangible. But other than that, I don't think there are any one-offs to call out, you know, for Q1. Like I said, we'll continue to be the fixed price productivity improvement in our pyramid.
Aparna Iyer: Yeah.
Speaker Change: I think, you know, the depreciation amortization expense doesn't really have...
Speaker Change: Anything that's very particular for me to call out, perhaps a couple of quarters back we may have had some acceleration of amortization of a particular intangible, but other than that I don't think there are any one-offs to call out, you know, for Q1.
Aparna Iyer: Lea was at play, like I said, will continue to be the fixed price productivity improvement in our pyramid. You know, Saurav has spoken about, you know, on-boring thresholds. We did a good number in Q1 and, you know, as we build a muscle on that, that will bring down the cost of delivery. The optimization of overheads is something that we have done in the context of, you know, declining revenues. It's very critical for us to shed weight and remain lean and efficient, and that's something that we are doing. There is also some synergies to be realized as, you know, acquired entities come into the larger, you know, with the whole administratively.
Speaker Change: [inaudible]
Speaker Change: Like I've said, we'll continue to be the fixed price productivity.
Aparna Iyer: You know, Saurabh has spoken about, you know, onboarding thresholds. We did a good number in Q1 and, you know, as we build our muscle on that, that will bring down the cost of delivery. The optimization of overheads is something that we've done in the context of, you know, declining revenues. It's very critical for us to shed weight and remain lean and efficient, and that's something that we are doing.
Speaker Change: Improvement in our pyramid.
Speaker Change: you know Saurabh has spoken about you know onboarding pressures we did a good number in Q1
Speaker Change: And, you know, as we build a muscle on that, that will bring down the cost of delivery. The optimization of overheads is something that we have done in the context of, you know, declining revenues. It's very critical for us to...
Speaker Change: Shared Weight and Remain Lean and Efficient and that's something that we are doing There is also some synergies to be realized as you know acquired entities come into the larger, you know, Wipro fold administratively
Aparna Iyer: So, these are all levers that can help us as we look at our margins in the future. I hope that answers. Thank you.
Speaker Change: So, these are all levers that can help us as we look at our margins in the future.
Abhishek Kumar: So, thank you. Next question is from the line of Abhishek Kumar from James Financial.
Speaker Change: I hope that answers. Thank you.
Operator: There are also some synergies to be realized as, you know, acquired entities come into the larger, you know, Wipro fold administrator. So these are all levers that can help us as we look at our margins in the future. I hope that answers you. Thank you. Thank you. Next question is from the line of Abhishek Kumar from JM Financial. Please go ahead. Good evening.
Speaker Change: Thank you.
Speaker Change: Next question is from the line of Abhishek Kumar from JM Financial. Please go ahead.
Abhishek Kumar: Please go ahead.
Abhishek Kumar: Good evening. Thanks for taking my question. In the first question on Capco, some of your peers have also indicated, you know, green shoots in BFFI, especially around discretionary short-cycle spend. Have you seen in Capco, you know, expansion of the area where Capco has been winning deals from, you know, what you're doing and maybe a couple of quarters back?
Abhishek Kumar: Thanks for taking my question. Srini, first question on Capco. Some of your peers have also indicated, you know, green shoots in BFSI, especially around discretionary short cycle spend. Have you seen, at Capco, an expansion of the areas where Capco has been winning deals from, you know, what you're doing, maybe a couple of quarters back? Hi Abhishek, thank you for the question.
Abhishek Kumar: Good evening. Thanks for taking my question. Srini, first question on Capco. Some of your peers have also indicated green shoots in BFSI, especially around discretionary short cycle span.
Abhishek Kumar: Have you seen in Capco, you know, expansion of the area where Capco has been winning deals from, you know, what you're doing maybe a couple of quarters back?
Srinivas Pallia: Hi, Abhishek. Thank you for the question. First and foremost, you know, I did talk about Capco having a sequential growth in the last couple of quarters, and our growth has come in across Europe and America's, and we're also looking at Asia Pacific as, you know, with forest Capco is like, you know, tip of the spear, which is consulting and strategy lead, and then the rest of the Wipro engine actually implement that. So we are seeing a good traction around that, and we are seeing greater demand at larger institutional clients across, you know, across the banks and some of the some of the extra and financial services companies.
Srinivas Pallia: First and foremost, you know, I talked about Capco having sequential growth in the last couple of quarters, and our growth has come across Europe and America, and we are also looking at Asia-Pacific, as you know. For us, CAPCO is like, you know, the tip of the spear, which is consulting and strategy-led, and then the rest of the Wipro engine actually implements that. So we are seeing good traction around that, and we are seeing greater demand from larger institutional clients across banks and some of the financial services companies.
Srini: Hi Abhishek, thank you for the question.
Srini: First and foremost I did talk about Capco having a sequential growth in the last couple of quarters and our growth has come in across Europe and America and we are also looking at Asia-Pacific as you know.
Speaker Change: Forest Capco is like you know tip of the spear
Speaker Change: which is consulting and strategy led and then the rest of the Wipro engine actually implement that. So we are seeing a good traction around that.
Speaker Change: and we are seeing greater demand at larger institutional clients across the banks and some of the financial services companies. So to me, what I would say, Abhishek is
Srinivas Pallia: So to me, what I would say, Abhishek, is that this gives you a little bit of color on how discretionary spending is coming back, at least in banking and financial services. And it's also reflected in our BFSI growth, right, sequentially as well. Sure. Energy Utility. This vertical has been unusually soft for us, while we have not seen that for any of our peers, so you know, any more color on what is driving the softness? Is it client specific? Are we losing out to peers in the consolidation scenario? Do you see any color here?
Srinivas Pallia: So to me, what I would say, Abhishek, is that this gives you a little bit of a color to how the discretionary spending is coming back, at least in the banking and financial services. And it's also reflected in our BFSI growth, right, as sequentially as well.
Abhishek: But this gives you a little bit of a color to how the discretionary spending is coming back, at least in the banking and financial services. And it's also reflected in our BFSI growth, right, sequentially as well.
Unknown Executive: Sure.
Abhishek Kumar: Energy and durability, this vertical has been unusually soft for us, while we have not seen that for any of our peers. So, you know, any more color on what is driving softness? Is it trans-specific? Are we using out to peers in under consolidation scenario, any color here and how do we see this going forward?
Aparna Iyer: And how do we see this going forward? Yes, so Abhishek, we lost you for like 10 seconds. Did you mean E&U? Yes, energy and youth. So I'll go, and then maybe Srini, if you want to add something, you know, see.
Abhishek: Sure.
Abhishek: Merging Utility, this vertical has been unusually soft for us.
Abhishek: Well, we have not seen that for any of our peers. So, you know, any more color on what is diving softness? Is it client specific? Are we losing out to peers in the consolidation scenario? Any color here? And how do we see this going forward? Thank you.
Srinivas Pallia: Thank you.
Srinivas Pallia: Yeah, so Abhishek, we lost you like for a 10 seconds, do you mean ENU? Yes, energy and utility. So I'll go, and then maybe she, if you want to add something. You know, see in ENU, we've had some end of large programs, and as a result, we have seen some softness in that industrial vertical. We got a good pipeline, which we need to convert. And it has been perhaps something that has been softer for withdrawers compared to, you know, what the market has been. You know, she has spoken about both industry-specific and cross-industry service offerings that we have, which particularly bolstered our presence in ENU.
Speaker Change: Yes, so Abhishek, we lost you like for 10 seconds, did you mean E&U?
Speaker Change: Yes, energy and utility, yeah.
Speaker Change: So I'll go and then maybe Shirdi if you want to add something, you know see in ENU we've had some end of large programs and as a result we have seen some softness in that
Aparna Iyer: In ENU, we've had some end of large programs and, as a result, we have seen some softness in that. Industry Vertical, We got a good pipeline that we need to convert, and it has been. Perhaps something that has been softer for Wipro as compared to, you know, what the market has been.
Srini: Industrial Vertical. We got a good pipeline which we need to convert and it has been
Shirdi: perhaps something that has been softer for Wipro as compared to you know what the market has been
Aparna Iyer: You know, Srini has spoken about both industry-specific and cross-industry service offerings that we have. We've particularly bolstered our presence in E&U. In fact, even Capco has a decent presence.
Speaker Change: You know, Srini has spoken about both industry-specific and cross-industry service offerings that we have. We particularly bolstered our presence.
Srinivas Pallia: In fact, even Capco has a decent presence; that's something that gives us a lot of, and you know Capco is doing pretty well in that space. And especially in the, you know, America, so we are seeing some bounce back there on that count. But we have, you know, some work to do. We've got a good set of service offerings that, you know, we need to win at the marketplace.
Aparna Iyer: That's something that gives us a lot of hope, and you know, Capco is doing pretty well in that space, and especially in, you know, America. So we are seeing some bounce back there on that count. But we have, you know, some work to do. We've got a good set of service offerings that, you know, we need to win in the market. Thanks Aparna. Oil and gas is one of the areas where CAPCO actually has the confronting capabilities. That's number one. Second, we are also building GNI-powered solutions. For example, we call it Blue Skies, which is actually autonomous monitoring to detect flares and smoke in degassing stations.
Speaker Change: In fact, even Capco has a decent presence. That's something that gives us...
Speaker Change: A lot of, and you know, Capco is doing pretty well in that space. And especially in the, you know, America, so we are seeing some bounce back there on that count. But we have, you know, some work to do, we've got a good set of
Speaker Change: Service offerings that you know we need to win at the marketplace.
Srinivas Pallia: Thanks up on now. See, oil and gas, you know, is one of the areas where Capco actually has the conferencing capabilities. That's number one. Second, we are also building generic powered solutions. For example, we call it as blue skies, which is actually autonomous monitoring to detect flare and smoke in degassing stations. And we are getting good traction in some of the clients because we want to actually, you know, lead through a specific business problem that our clients are facing. And in fact, this particular one, you know, there was an 80% reduction in efforts response time to some of the two, you know, events.
Speaker Change: Thanks Aparna. See oil and gas you know is one of the areas where CAPCO actually has the consulting capabilities that's number one.
Speaker Change: Second, we are also building JNI-powered solutions. For example, we call it as Blue Skies.
Speaker Change: which is actually autonomous monitoring to detect flare and smoke in degassing stations and we are getting good traction in some of the clients because we want to actually
Srinivas Pallia: We are getting good traction with some of the clients because we want to actually lead through specific business problems that our clients are facing. In fact, this particular one, there was an 80% reduction in effort and response time to some of the two events. And what our strategy will be going forward in the context of oil and gas. Like Aparna said, energy and utilities for us, because of some of the large projects coming down, have been soft in quarter one. And that's why you've seen the sequential decline. Okay, great. Thank you and good luck!
Srinivas Pallia: and Srinivas Pallia.
Srinivas Pallia: And so this is what our strategy will be going forward in the context of oil and gas. Like upon us said, an engine utility is for us because of some of the large projects coming down has been solved in quarter one. And that's why you're seeing the sequential digs.
Speaker Change: What our strategy will be going forward in the context of oil and gas, like Aparna said energy and utilities for us because of some of the large projects coming down has been soft in quarter one and that's why you've seen the sequential degrowth.
Unknown Executive: Great, thank you, and good luck. Thank you.
Speaker Change: Okay, great. Thank you and good luck.
Sandeep Shah: Next question is from the line of Sandeep Shah from Echurra Securities. Please go ahead. Yeah, thanks. Thanks for the opportunity.
Operator: Thank you. The next question is from the line of Sandeep Shah from Equus Securities. Please go ahead.
Speaker Change: Thank you. Thank you.
Speaker Change: Next question is from the line of Sandeep Shah from Equus Securities. Please go ahead.
Sandeep Shah: Thanks for the opportunity. The first question Srini, Wipro being the first one to call out green shoots, especially selectively in Capco, financial services, healthcare, and directionally, the growth is expected to improve versus the fourth quarter being a flattish growth versus this quarter, at least it should have shown the trend of an upward trajectory, was actually a minus 1% kind of growth. So what is it?
Sandeep Shah: The first question to be me, before being the first one to call out green tubes, especially selectively in gap co-financial services health care. And, directionally, the growth is expected to improve versus fourth quarter being a flat edge growth versus this quarter; at least it should have shown the trend of upward trajectory versus actually a minus 1 person kind of a growth. So, what is it? Is it surprised you negatively, or is it more with pro-specific rather than external factors, and which you believe can be rectified going forward?
Sandeep Shah: Thanks for the opportunity.
Speaker Change: The first question Srini, Wipro being the first one to call out green shoots especially selectively in Capco, financial services, healthcare and directionally the growth is expected to improve versus fourth quarter being a flattish growth versus this quarter at least it should have
Aparna Iyer: Is it surprising you negatively, or is it more Wipro-specific rather than external factors and which you believe can be rectified going forward? Sandeep, I'll go first and of course, Srini will add, you know, we guide based on the visibility that we have, there are puts and takes, there are parts of the businesses where we are seeing momentum, and, like you rightly said, we remain authentic and true, and we share with you proactively where we're seeing some of the discretionary spends come back. True to that, I think Capco is one place where we' We've spoken about how Americas 1 has had continued growth momentum. We spoke of healthcare doing well, and this quarter, we've seen acceleration of momentum in consumer and telecom in Americas 1.
Speaker Change: This is a graph that shows the trend of upward trajectory versus actually a minus one percent kind of a growth. So, what is it? Is it surprised you negatively or is it more Wipro specific rather than external factors which you believe can be rectified going forward?
Srinivas Pallia: So, Sandeep, I will go first, and of course, Srini, we will add, you know, we guide based on a visibility that we have. There are putsintakes, there are parts of the businesses where we are seeing momentum and, like you rightly said, we remain authentic and true and we share with you proactively where we are seeing some of the discretionary spends come back and true to that, I think upco is one place where we have seen now three quarters. It is bouncing back quite broad based. We have spoken about how America's one has had a continued growth momentum.
Speaker Change: Sandeep, I'll go first and of course Srini will add, you know, we guide based on a visibility that we have.
Speaker Change: there are percentage
Srini: There are parts of the businesses where we are seeing momentum, and like you rightly said,
Srini: we remain authentic and true and we share with you
Srini: Proactively where we're seeing some of the discretionary spends come back and and true to that I think APCO is one place where we've seen now three quarters it is bouncing back quite broad-based
Srini: We've spoken about how America's one has had
Srinivas Pallia: We spoke of health care doing well, and this quarter we seeing accelerated acceleration of momentum in consumer and telecom in America's one. If you look at America's two, we have said that, you know, BFSI or BFSS have done well in America's two as a sector, and we are seeing a sequential growth there of 1.4 percent, and you know, the bookings have been strong. And you know, those are things that we have shared with you very clearly. The places where we see softness is Europe and up near, and guidance is actually a combination of both the pluses and minus that we are seeing at the moment.
Srini: A continued
Srini: Growth Momentum. We spoke of
Srini: Healthcare Doing Well
Srini: and this quarter we are seeing acceleration of momentum in consumer and
Sandeep Shah: If you look at Americas 2, we've said that, you know, BFSI or BFS has done well in Americas 2 as a sector, and we're seeing a sequential growth there of 1.4%. And, you know, the bookings have been strong, and you know those are things that we've shared with you very clearly the places where we see softness is Europe and apnea and guidance is actually a combination of both the pluses and minuses that we are seeing at the moment Gini also said that you know we're entering Q2 with a little bit more confidence than what we did at the start of Q1 right so you'll have to take all that into you know consideration Sandeep, Yeah, fair enough.
Srini: Telecom in Americas 1. If you look at Americas 2, we've said that you know BFSI or BFS has done well in Americas 2 as a sector and we're seeing a sequential growth there of 1.4% and you know the bookings have been strong.
Srini: and you know those are things that we have shared with you very clearly
Srini: The places where we see softness
Srinivas Pallia: Sheenie also said that, you know, we entering Q2 with a little bit more confidence than what we did at the start of Q1, right? So, you will have to take all that into, you know, consideration, Sunday.
Shini: Ginny also said that you know we're entering Q2 with a little bit more confidence than what we did at the start of Q1 right so you'll have to take all that into you know consideration Sandeep
Sandeep Shah: Yeah, fair enough, fair enough. And she just wanted to understand, is there any timeline which you believe by that time, we could be enough full execution more and the structuring changes will start delivering the results which have been aspired to under your statically direction?
Sandeep Shah: And Srini, just wanted to understand, is there any timeline by which you believe by that time, we could be in full execution mode, and restructuring changes will start delivering the results which are being aspired to under your strategic direction? Sandeep, at this point in time, I am not calling out the timeline, our focus is to execute our quarter 2 guidance. Having said that, Sandeep, we have called out 5 strategic priorities, and I did talk about the progress we made on each of the strategic priorities. I think what we need to do is to bring in that execution rigor with speed.
Sandeep Shah: Yeah, fair enough. And Srin, just wanted to understand, is there any timeline which you believe by that time we could be in a full execution mode and the restructuring changes will start delivering the results which are being aspired to under your strategic direction?
Srinivas Pallia: Sunday, at this point in time, I am not calling out the timeline. Our focus is to execute our quarter-to guidance. Having said that Sunday, we have called out five strategic priorities. I did talk about the progress we made in each of the strategic priorities. I think what we need to do is to bring in that execution rigor with speed. We need to delight our customers, focus on delivery excellence, and all the operational metrics that Aparna talked about. We need to continue to focus on building large deals, growing our large clients, continue to build or invest into our, you know, building skills within the pro.
Srin: Sandeep, at this point in time, I'm not calling out the timeline, our focus is to execute our quarter 2 guidance, having said that Sandeep, we have called out 5 strategic priorities,
Sandeep Shah: I did talk about the progress.
Srin: We made in each of the strategic priorities. I think what we need to do.
Srinivas Pallia: We need to delight our customers, focus on delivery excellence, and all the operational metrics that Aparna talked about. We need to continue to focus on building large deals, growing our large clients, and continue to build or invest in building skills within Wipro. I talked about iAspire, which is very exciting for the employees as we speak, and we will continue to invest in industry-specific solutions, which are powered by AI, consulting-led, and also cross-industry solutions that are horizontal. I did talk about four wins in this segment.
Srin: is to bring in that execution rigor with speed.
Srin: We need to delight our customers, focus on delivery excellence and all the operational metrics that Aparna talked about. We need to continue to focus on building large deals.
Aparna Iyer: We are now growing our large clients.
Speaker Change: continue to build or invest into or you know building skills within Wipro. I talked about I aspire which is very exciting for the employees as we speak.
Srinivas Pallia: I talked about ISPAR, which is very exciting for the employees as we speak. And we will continue to invest in industry specific solutions which are powered by AI, consulting late and also cross industry solutions that are horizontal. I did talk about four wins in this segment. One was in telecom, one was in manufacturing, one was in health care, or the one more on the wealth management within banking and financial services. That gives me comfort on two areas. One, I think our, you know, initial strategies picking up momentum with our clients. Second, these things can be replicated across as well Sunday.
Speaker Change: and we will continue to invest.
Speaker Change: and Industry Specific Solutions.
Speaker Change: which are powered by AI, consulting-led and also cross-industry solutions that are horizontal. I did talk about...
Srinivas Pallia: One was in telecom. One was in manufacturing. And one was in health care.
Speaker Change: 4 wins
Speaker Change: In this segment, one was in telecom, one was in manufacturing, one was in healthcare, other one more on the wealth management within banking and financial services.
Srinivas Pallia: Another one more on wealth management within banking and financial services. That gives me comfort on two areas. One, I think our initial strategy is picking up momentum with our clients. Second, these things can be replicated across as well. And the skill sets we are building are someone with people who can execute on this as well. Okay, fair enough. And last question, Aparna.
Speaker Change: [inaudible]
Srinivas Pallia: And the skill sets we are building is someone, you know, with people who can execute to this as well.
Aparna Iyer: This quarter, there has been a significant shift towards onsite, which has increased by 250 bps, versus that minus 1% revenue growth. Is it fair to assume the volume growth or volume decline could be even higher than the headline revenue decline? And in that scenario, even the margin has actually been very good in terms of execution, and employee cost has gone down despite the onsite effort, which could be because of rationalization and the decline in the number of employees is happening.
Speaker Change: Okay, fair enough. And last question, Aparna?
Speaker Change: This quarter, there has been a significant shift towards the onsite, which has increased by 250 bps.
Speaker Change: Is it fair to assume that the volume growth or volume decline could be even higher than the headline revenue decline?
Unknown Executive: Srinivas Pallia, Srinivas Pallia, Amit Choudhary, Srinivas Pallia, Srinivas Pallia, Amit Choudhary, Srinivas Pallia, Srinivas Pallia, Amit Choudhary, Srinivas Pallia, Amit Choudhary, Srinivas Pallia, Amit Choudhary, Srinivas Pallia. We wanted to ask you about how you're thinking about improving the growth momentum. We want to take an approach where you invest upfront, and one of your peers, whether it's been a senior change. They've taken an approach to completely disregard, I think, near-term margins, and try to focus on growth first, and then thinking that margins will come later. Do you agree with that?
Speaker Change: And in that scenario, even the margin has actually been very good in terms of execution and employee cost has gone down despite the onsite effort, which could be because of the rationalization and the decline in the employee is happening. So just wanted some clarity on this.
Aparna Iyer: So just wanted some clarity on, Thank you for the question Sandeep. You know I want to bring to attention that you know we've integrated a few of our entities as a result which were more onsite specific so you know I don't know if they are directly comparable between a Q1 and a last Q4 in terms of the onsite mix but everything else that you've said is also true that our employee compensation cost continues to go down because of a focus and a concerted action around productivity and making sure you're able to deliver to a cost that you would like to given where our revenues are so there is a lot of focus around it and all levers are being flexed on that count so we are not becoming more onsite centric it's a metric which may not be directly comparable but going forward now that it's in the base it will be a couple of our onsite centric subsidiaries have now got integrated that's one of the reasons why you're seeing it but costs are of course comparable and you know everything else that you said is true. Okay, thanks and all the best. Thank you Thank you, Next question is from the line of Ravi Menon from Macquarie. Please go ahead.
Speaker Change: Thank you for the question Sandeep. I want to bring to attention that you know...
Speaker Change: We have integrated a few of our entities.
Speaker Change: As a result, which were more on-site specific, so, you know, I don't know if they are...
Speaker Change: All these people are directly comparable between a Q1 and a last Q4 in terms of the on-site mix, but everything else that you have said is also true.
Speaker Change: There are employee compensation costs continues to go down.
Speaker Change: Because of a focus and a concerted action around productivity and making sure you're able to deliver to a cost that you would like to, given where our revenues are, there is a lot of focus around it and all levers are being flexed on that count.
Speaker Change: So, we are not...
Speaker Change: Becoming more on-site centric, it's...
Speaker Change: It's a metric, which may not be directly comparable, but going forward, now that it's in the base, it will be. A couple of our onsite centric subsidiaries have now got integrated.
Speaker Change: One of the reasons why you're seeing it.
Speaker Change: But costs are of course comparable and you know, everything else that you set up stays good.
Speaker Change: Okay, thanks and all the best.
Speaker Change: Thank you.
Speaker Change: Next question is from the line of Ravi Menon from Macquarie. Please go ahead.
Ravi Menon: Hi, thank you for the opportunity and congrats on good execution on the margin side. So yeah, I wanted to ask you about how are you thinking about improving the growth momentum? Do you want to take an approach where you invest upfront and one of your peers...
Ravi Menon: So yeah, I wanted to ask you about, you know, how are you thinking about improving the growth momentum? You want to take an approach where you invest upfront, and one of your peers, whether it's been a senior change, you know, they've taken an approach to completely disregard, I think, near-term margins and try to focus on growth first and then think that margins will come later. Do you agree with that? Or do you think we need to do something else to accelerate the process?
Ravi Menon: [inaudible]
Aparna Iyer: Or what do you think we need to do to action-write the process? We've spoken about profitable growth as being our focus. Srinivas has spoken about it, and that remains. Our margin has continued to expand because of the operational rigor. This is something that we've been doing over the last six quarters, and we continue to march on on that. Of course, one of the reasons why we believe that we will hold margins in an arrow band with an upward bias is also because we want to make sure that we have enough room for us to invest for growth.
Aparna Iyer: You know, we've spoken about profitable growth as being our focus, Srini has spoken about it, and that remains. Our margin has continued to expand because of operational rigor. This is something that we've been doing over the last six quarters, and we continue to march on with that. Of course, one of the reasons why we believe that, you know, we will hold margins in a narrow band with an upward bias is also because we want to make sure that we have enough room for us to invest for growth, and you can be assured we won't hold back on our investments for growth. That remains our number one priority.
Ravi Menon: You know, we've spoken about profitable growth as being our focus, Srini has spoken about it and that remains.
Speaker Change: you know our margin have continued to expand because of the operational rigor this is something that we've been doing over the last six quarters
Speaker Change: and we continue to march on on that.
Speaker Change: Of course, one of the reasons why we believe that we will hold margins in a narrow band with an upward bias is also because we want to make sure that we are having enough room for us to invest for growth and you can be assured we won't.
Aparna Iyer: You can be assured we won't hold back on our investments for growth. That remains the number one priority. I've also said that in Q1, we invested in our employees as well. We covered a few of our employees under the long term incentive stock options. We continue to invest in our people, in our employees, in our associates, and we will continue to invest for growth. Everything that Srinivas has spoken about, we will continue to invest.
Aparna Iyer: I've also said that in Q1, we invested in our employees as well. You know, we covered a few of our employees under the long-term incentive stock options. So that's also coming.
Speaker Change: hold back on our investments for growth that remains the number one priority
Speaker Change: I've also said that in Q1, we invested in our employees as well, you know, we covered, you know, a few of our employees.
Aparna Iyer: So we continue to invest in our people, in our employees, in our associates, and we will continue to invest for growth. Everything that Srini has spoken about, we will continue to invest in them. Great. Thank you very much, Arvind. And a question on this, the customer tiers. We've seen that in the 75 million plus tiers, there has been a drop of three customers from Kotor, but you don't hear it's still up by one.
Speaker Change: Under the long term incentive stock options so that's also coming so we continue to invest in our people in our employees in our associates and we will continue to invest for growth everything that Srini has spoken about we will continue to invest in them
Ravi Menon: Thank you very much, and you will question those customer peers. You know, we've seen that in the Sandy family and plus peer, there has been a drop of three customers. Kotwanko, you're only at still up by one, but just wanted to understand. And if I look at, it's not even dropped onto the 50 million plus tier, but that is down by two. So, are we still seeing some pressure, even the largest clients, in terms of spending? Are there still cutbacks and projects? So, Ravi, if we look at our client base, the top 10 clients have grown, top 25 clients have grown, and there are certain clients where, you know, you're seen a little bit of a shrink. It's also to do with the discretionary spends, which have been a little bit slow incoming.
Ravi Menon: But just wanted to understand, if I look at it, it's not even dropped down to the 50 million plus tier, and that is down by two. So are we still seeing some pressure with even the largest clients in terms of spending? Are they still cutting back on projects? So, Ravi, if we look at our client base, the top 10 clients have grown, the top 25 clients have, and there are certain clients where you know you've seen a little bit of a shrink. It's also to do with the discretionary spends which have been a little bit slow in coming. Having said that, Ravi, the strategy for us is that we want to invest in our top accounts.
Speaker Change: Great, thank you very much Arvind. And a question on this, the customer tiers, we have seen that in the 75 million plus tiers there has been a drop-off.
Speaker Change: Aparna Iyer, Srinivas Pallia, Dipak Bohra, Unknown Executive
Speaker Change: Are we still seeing some pressure with even the largest clients in terms of spending, are there still cutbacks in projects?
Speaker Change: So Ravi, if we look at our client base, the top 10 clients have grown, top 25 clients have grown.
Speaker Change: and there are certain clients where you know you've seen a little bit of a shrink it's also to do with the discretionary spends which have been a little bit slow in coming
Srinivas Pallia: Having said that, Ravi, the strategy for us is we want to invest in our top accounts; we also want to invest in the future top accounts, and then I clearly called out the investment will be at an account level, where you actually bring in the right solutions, right delivery, and the consulting rate aspects of it, and with that will be the journey for us. A few here and there, I'm not too worried, Ravi, but what's important is how our top clients are marching forward in terms of growth for us.
Speaker Change: Having said that, Ravi, the strategy for us is...
Ravi Menon: We want to invest.
Ravi Menon: In our top accounts, we also want to invest in the future top accounts.
Ravi Menon: We also want to invest in future top accounts. And then I clearly said the investment would be at an account level where you actually bring in the right solutions, right delivery, and the consulting-led aspects of it. And that will be the journey for us. A few here and there, I'm not too worried, Ravi.
Ravi Menon: and then I clearly called out the investment will be at an account level
Ravi Menon: Bringing the right solutions, right delivery and the consulting led aspects of it and with that will be the journey for us
Ravi Menon: [inaudible]
Unknown Executive: Thank you for being here, and have better luck.
Unknown Executive: Thank you.
Speaker Change: Thank you for your time and best of luck.
Nitin Padmanaban: We have an next question from the line of Niten Padmanaban from Investek. Please go ahead. Yeah, hi, good evening. I think we had mentioned that the top 10 have grown around 1.3 percent; top 20 or 25 are grown around 1 percent. So obviously, looks like the drag has been from these smaller customers.
Nitin Padmanabhan: But what's important is how our top clients are marching forward in terms of growth for us. Thank you. We have a next question from the line of Nitin Padmanabhan from Investec. Please go ahead.
Speaker Change: Thank you.
Speaker Change: We have a next question from the line of Nitin Padmanabhan from Investec. Please go ahead.
Nitin Padmanabhan: Yeah, hi, good evening. Aparna and Srini, I think you had mentioned that the top 10 have grown around 1.3%, and the top 20 to 25 have grown around 1%. So obviously, it looks like the drag has been from the smaller customers. But are we still cutting off tail accounts? Or is this just a broad-based kind of decline that we're seeing? Or any color that you could give us in terms of what you're seeing on that side of things?
Nitin Padmanabhan: Yeah, hi, good evening. Aparna and Srini, I think you had mentioned that the top 10 have grown around 1.3%, top 28 or 25 have grown around 1%,
Speaker Change: So, obviously looks like the drag has been from the smaller customers.
Nitin Padmanaban: Are we still cutting tail accounts, or is this just a broad base kind of decline that they're seeing, or any color that you could give us in terms of what you'll see on that side of things, and what do you think will be the drivers for improvement there? I think our strategy on tail accounts consolidation is nearly towards the end, and I, you know, at least this quarter, I don't think that's the compelling reason for the decline. It was more specific to Amia, more specific to sectors like India, Middle East, where we had a long tail of clients, and we felt it was important for us to, you know, make the clients fewer, but go deeper.
Nitin Padmanabhan: Are we still cutting tail accounts or is this just a broad based kind of decline that we are seeing or any color that you could give us in terms of what you are seeing on that side of things and what do you think will be the drivers for improvement there?
Aparna Iyer: And what do you think will be the drivers for improvement there? I think our strategy for tail accounts consolidation is nearly towards the end, and I, you know, at least this quarter, I don't think that's the compelling reason for the decline. It was more specific to APMEA, more specific to sectors like India and the Middle East, where we had a long tail of clients, and we felt it was important for us to, you know, make the clients fewer, but go deeper. We are happy with the place where we are.
Speaker Change: I think our strategy on tail accounts consolidation is nearly towards the end and I you know at least this quarter I don't think that's the compelling
Speaker Change: It was more specific to APMEA, more specific to sectors like India, Middle East where we had a long tail of clients.
Speaker Change: We felt it was important for us to, you know, make the clients fewer but go deeper.
Aparna Iyer: We are happy with the place where we are. We have executed on that. You know, the decline that you're also seeing is also a reflection of the lower discretion spends, and the decline that the company is seeing overall, and therefore reflects in a few client buckets, like you mentioned. You know, we remain committed to growing our top 100 clients, and you should take assurance on the growth that you're seeing from our top 25, like Shini said. There's nothing more that I need to add on that.
Nitin Padmanabhan: We have executed on that. You know, the decline that you're also seeing is also a reflection of the lower discretionary expense and the decline that the company has seen overall, and therefore it reflects in a few client buckets, like you mentioned. You know, we remain committed to growing our top 100 clients, and you should take assurance on the growth that you're seeing from our top 25, like Srini said. There's nothing more that I need to add to that.
Speaker Change: We are happy with the place where we are. We have executed on that.
Speaker Change: The decline that you are also seeing is also a reflection of the lower discretionary spend and the decline that the company has seen overall and therefore it reflects in a few client buckets like you mentioned.
Speaker Change: You know we remain committed to growing our top 100 clients and you should take assurance on the growth that you're seeing from our top 25 like Srini said. There's nothing more that I need to add on that.
Nitin Padmanaban: Sure, perfect. And lastly, on the BFFI side, so well, we have been very early in calling this out, and it worked out pretty well. What exactly is the current drag that you're seeing? Any specific subsegments where you're seeing a little more pain, because it's relative to the others, although we called it out earlier, the relative growth is slightly softer. So, is there any specific subsegments, which is called this terminal, a little more pain for us? Yes, so I think PFSI America is generally doing better compared to Europe; Asia Pacific is also done well. So that's the color from a market standpoint.
Nitin Padmanabhan: Sure, perfect. And lastly, on the BFSI side, so well, we've been very early in calling this out, and it's worked out pretty well. What exactly is the current drag that you're seeing? Any specific subsegments where you're seeing a little more pain?
Srini: Sure, perfect. And lastly, on the BFSI side, so well, we have been very early in calling this out and it's worked out pretty well.
Speaker Change: What exactly is the current drag that you are seeing in any specific sub-segments where you are seeing a little more pain because relative to the others, although we called it out earlier, the relative growth is slightly softer.
Speaker Change: So, is there any specific sub-segments which is causing a little more pain for us?
Aparna Iyer: Because relative to the others, although we called it out earlier, the relative growth is slightly softer. So are there any specific subsegments which are causing a little more pain for us? Yeah, so I think BFSI Americas is generally doing better compared to Europe, and Asia Pacific has also done well. So that's the picture from a market standpoint. You know, I think Europe is being slightly softer. So Nitin, and Srini, just to add a little bit more color to what Aparna said, in the context of BFSI, I think you know we are seeing secular growth both in Europe and, you are in America at that time; I talked about both in quarter one and quarter two.
Speaker Change: Yeah, so I think BFSI Americas is generally doing better compared to Europe . Asia-Pacific has also done well. So that's the color from a market standpoint. You know, I think Europe has been slightly softer from a market standpoint.
Srinivas Pallia: You know I think Europe has been slightly softer for me. America is that I talked about both in quarter one and quarter two. And since you asked the specific where we are seeing that with Capco being the tip of the spear in some of the aspects of the clients across the risk and compliance across cost optimization and of course some of the business transformation the clients are doing it. Capco is actually leading the charge for us, and Wipro is actually becoming more on the implementation side, and that's also coming together, Nathan.
Speaker Change: So Nitin and Srini just add a little bit more color to what...
Speaker Change: Aparna said, in the context of BFSI, I think, you know, we are seeing a secular growth both in Europe and
Speaker Change: U.S. and America that I know I talked about both in quarter one and quarter two.
Aparna Iyer: And since you asked the specific areas where we have seen Capco being the tip of the spear in some of the aspects of the clients across risk and compliance, across cost optimization, and, of course, some of the business transformation, the clients are doing it, you know, Capco is actually leading the charge for us. And, you know, and Wipro is actually becoming more on the implementation side. And that's also coming together.
Srinivas Pallia: and Srinivas Pallia.
Srinivas Pallia: of Vipro.
Nitin Padmanaban: Super and the way you see things today, just my final question: the way you see things today and the way things are sort of evolving, and you look at the environment in terms of elections maybe in the second half. Are you seeing clients basically sort of talking of trying to close in some execution early on, considering there could be some level of uncertainty in the end, or that's not a right character is not what you're saying. Now, I like the word Nathan uncertainty, right. The macro environment today is, you know, definitely not really as predictable. The political situations various, but also there are certain good news from the Fed in terms of the rates and also the inflation aspects of it.
Aparna Iyer: And the way you see things today, just my final question, the way you see things today and the way things are sort of evolving, and you look at the environment in terms of elections maybe in the second half, Are you seeing clients basically sort of talking about trying to close in on some execution early on considering there could be some level of uncertainty in the end, or is that not a good characterization of what you're saying? Now, I like the word, Nitin, uncertainty, right? The macro environment today is, you know, definitely not really as predictable. The political situations vary.
Speaker Change: And the way you see things today, just my final question, the way you see things today and the way things are sort of evolving,
Amit Choudhary: Amit Choudhary
Amit Choudhary: and you look at the environment in terms of elections maybe in the second half
Speaker Change: Are you seeing clients basically sort of talking of trying to close in some execution early on considering there could be some level of uncertainty in the end or that's not a right characterization of what you're seeing?
Nitin: I like the word, Nitin, uncertainty. The macro environment today is definitely not really as...
Nitin Padmanabhan: But also, there are certain good news from the Fed, in terms of, you know, could be good news from the Fed, in terms of rates and also the inflation aspects of it. So it's kind of a mixed bag, Nitin, as we speak. But where we are focused is on how we execute a quarter two, especially in the context of the range that we gave you, and also the deals that we have in the pipeline, how do we convert them? I think that's the focus we're going to, you know, we're going to drive. Sure, thank you so much, and all the very best.
Nitin: Predictable, the political situations varies.
Nitin: But also there are certain good news from the Fed in terms of, you know, could be good news from the Fed in terms of the rates and also the inflation aspects of it. So it's kind of a mixed bag, Nitin, as we speak, but where we are focused is in how do we execute a quarter two, especially in the context of...
Srinivas Pallia: So it's kind of a mixture bag, Nathan, as we speak, but where we are focused is in a how do we execute a quarter to, especially in the context of the range that we gave you and also the deals that we have in the pipeline, how do we convert them. I think that's the focus we're going to, you know, we're going to drive on it and.
Nitin: The range that we gave you and also the deals that we have in the pipeline, how do we convert them? I think that's the focus we're going to drive, Nitin.
Sudeer Guntapalli: So thank you so much, and all the very best. Thank you.
Nitin: Thank you so much and all the very best.
Kumar Rakesh: Next question is from the line of Kumar Rakesh from BNP Paribas, please go ahead. Hi, good evening. Thank you for taking my question.
Operator: Thank you. The next question is from the line of Kumar Rakesh from BNP Paribas. Please go ahead.
Nathan: Thank you.
Speaker Change: Next question is from the line of Kumar Rakesh from BNP Paribas. Please go ahead.
Kumar Rakesh: Hi, good evening. Thank you for taking my question. Singh, my first question was, for the last four quarters, the magnitude of the QoQ revenue decline was coming down, and then in this quarter, we have seen the decline increased again. This was despite the strength in BFSI that the industry has seen, and you have relatively similar or higher exposure in that vertical. It shakes the confidence in the recovery that we were hoping that, at some stage, should start kicking in.
Kumar Rakesh: Scheme, my first question was for the last four quarters; the magnitude of QOQ revenue decline was coming down, and then in this quarter we have seen the decline has increased again. This was despite the strength and BFSI that the industry has seen, and you have relatively similar or higher exposure in that vertical at shake the confidence in the recovery that we were hoping that at some stage should start kicking in. Now, from your commentary that you have made about the large deal wins that you are winning, some of the larger ones are actually met new and the strong deal pipe, and you have some of your peers have also spoken about how the deal to revenue conversion now is improving.
Kumar Rakesh: Hi, good evening. Thank you for taking my question.
Kumar Rakesh: [inaudible]
Speaker Change: This was despite the strength in BFSI that the industry has seen and you have relatively similar or higher exposure in that vertical.
Speaker Change #100: Let's shake the confidence in the recovery that we were hoping that at some stage should start kicking in.
Srinivas Pallia: Now, from your commentary that you have made about the large deal wins that you have been in, some of the larger ones are actually net new, and the strong deal pipeline you have, some of your peers have also spoken about how the deal-to-revenue conversion now is improving. Do you think you have reached a stage where you can at least say that, sequentially from here on, Wipro should start seeing improving revenue growth? And if not, then what is holding you back?
Speaker Change #101: So from your commentary that you have made about the large dealings that you have been in.
Amit Choudhary: and Amit Choudhary.
Srinivas Pallia: Do you think you have reached a stage that you can at least say that sequentially from here on the approach should start seeing improving revenue growth. And if not, then what is holding you back?
Speaker Change #102: The Deal to Revenue Conversion now is improving. Do you think you have reached a stage where you can at least say that sequentially from here on, Wipro should start seeing improving revenue growth? And if not, then what is holding you back?
Srinivas Pallia: Hi, Kumar. I will not comment how our growth will be beyond quarter to the guidance that we've given, but having said that, you know, Kumar, I want to call out few things right. We're not still seeing a significant change in the demand environment. There is caution from the clients and discretionary spend is low. However, like I called out, we are seeing an uptick in Capco, we are seeing an uptick in BFSI, and also talked about consumer business in the US. The sectors like A&U and manufacturing specifically for us has been soft. And if you look at outside of America's one in America's two, while they are building the momentum, the other two market units which are specifically Europe and Apnea, we have seen a sequential declared.
Srinivas Pallia: Hi, Kumar. I will not comment on how our growth will be beyond quarter two, the guidance that we're given. But having said that, you know, Kumar, I want to call out a few things, right? We're not still seeing a significant change in the demand environment. There is caution from our clients, and discretionary spend is low.
Speaker Change #103: Hi Kumar, I will not comment on how our growth will be beyond Q2, the guidance that we are given. But having said that, Kumar, I want to call out a few things. We are not still seeing a significant change in the demand environment. There is caution from our clients and discretionary spend is low.
Kumar Rakesh: However, like I called out, we are seeing an uptick in Capco, and we are seeing an uptick in BFSI, and we also talked about consumer business in the US. The sectors like E&U and manufacturing, specifically for us, have been solved, and if you look outside of America's one and America's, while they are building the momentum, the other two market units, which are specifically Europe and APMEA, we have seen a sequential decline and, in the context of large deals, some of the deals we are in the early stage, some of them are net new, are in the early stage, we have signed, I would say that would be my summary answer to your question, Kumar. Thanks for that! My second question was more of a clarification.
Speaker Change #103: However, like I called out, we are seeing an uptick in Capco, we are seeing an uptick in BFSI, and also talked about consumer business in the US.
Speaker Change #103: But the sectors like E&U and manufacturing specifically for us has been soft.
Speaker Change #103: and if you look at outside of Americas 1 and Americas 2
Speaker Change #103: The other two market units, which are specifically Europe and APMEA, we have seen a sequential decline.
Srinivas Pallia: And the in the context of large deals, some of the deals we are in the early stage, some of them are net new, are in the early stage, we have signed. And I presume that it will take few quarters for us. And Apnea did talk about some component being taken in quarter two and quarters ahead. I would say that would be my summary for your question, Kumar.
Speaker Change #103: and in the context of large deals.
Speaker Change #103: Some of the deals we are in the early stage, some of them are net new, are in the early stage, we have signed.
Aparna Iyer: And I presume that it will take few quarters for us and Aparna did talk about some component being taken in quarter 2 and quarters ahead. I would say that would be my summary for your question Kumar.
Kumar Rakesh: Thanks for that.
Srinivas Pallia: So last month Airbus came out with a profit warning. And since then, we have seen a couple of Europe-based ID services, some of the services companies issuing their own profit warnings as well, cutting their guidance. Does that have anything to do with our manufacturing weakness? Or do you think any of that has any implication for Wipro? No, not really.
Kumar Rakesh: My second question was more of clarification. So, last month the Airbus came out with a profit warning. And since then we have seen a couple of Europe-based ID services, some of the services companies issuing their own profit warning as well, cutting their identity. Does our manufacturing weakness have anything to do with that? Or do you think any of that has any implication for the two?
Speaker Change #104: Thanks for that. My second question was more of a clarification. So last month Airbus came out with a profit warning and since then we have seen a couple of Europe-based IT services, some of the services companies issuing their own profit warning as well, cutting their guidance. Does our manufacturing weakness has anything to do with that or you think any of that has any implication for Wipro?
Srinivas Pallia: No, not really. I, you know, all what you mentioned really is not impacting us. In fact, like Shini mentioned, we have a good pipeline; we have a good deal for us. You know, this is about our own conversion of the pipeline that we have. And I don't think you know the companies you mentioned or their profit warnings; there have had anything to do with the softness that we've experienced.
Kumar Rakesh: I, you know, all what you mentioned really is not impacting us. In fact, like Srini mentioned, we've, we have a good pipeline, we won a good deal for us. You know, this is about our own conversion of the pipeline that we have.
Speaker Change #105: No, not really. I, you know, all what you mentioned really is not impacting us. In fact, like Srini mentioned, we've
Speaker Change #106: We have a good pipeline. We won a good deal. For us, you know, this is about our own conversion of the pipeline that we have. And I don't think, you know, the companies you mentioned or their profit warnings there have had anything to do with the softness that we've experienced.
Speaker Change #107: Thanks for clarifying that Aparna.
Sudeer Guntapalli: We have an next question from the line of Sudeer Guntapalli from Kotak Mahindra, AMC. Please go ahead. Yeah, hi, Shini. Thanks for the opportunity. And just a flexed with a set of comments from your side would seem to be contributing to each other. On one side, we are seeing that for the last three quarters, we are seeing an uptick in Capco, which is consulting flash with Krishna Rihavi. And that is not necessarily translating into a very strong growth at the BFSI level or the overall company level, which I think some of our competitors have reported almost 7.5% to 8% sort of sequential revenue growth in BFSI in this quarter.
Aparna Iyer: And I don't think, you know, the companies you mentioned or their profit warnings there have had anything to do with the softness that we've experienced. Thanks for clarifying that, Aparna. Thank you. We have a next question from the line of Sudhir Guntapalli from Kotak Mahindra, India. Hi Srini, thanks for the opportunity. I was just perplexed with a set of comments from your side, which seem to be contradicting each other.
Aparna Iyer: Thank you.
Speaker Change #108: We have a next question from the line of Sudhir Guntapalli from Kotak Mahindra AMC, please go ahead.
Sudheer Guntupalli: Hi Srini, thanks for the opportunity. Just perplexed with a set of comments from your side, which seem to be contradicting each other. On one side, we are seeing that for the last three quarters, we are seeing an uptick in Capco, which is consulting slash discretionary heavy. And that is not necessarily translating into a very strong growth at the BFSI level or the overall company level.
Sudheer Guntupalli: On the one hand, we are seeing that for the last three quarters, we are seeing an uptick in Capco, which is consulting-discretionary heavy, and that is not necessarily translating into very strong growth at the BFSI level or the overall company level, which I think some of our competitors have reported almost 7.5% to 8% sort of sequential revenue growth in BFSI this quarter. So if you were to give us a cut on whether Capco within BFSI is doing well, what is not doing well? I understand the geographical slicing and dicing you gave earlier, but any specific color on whether you are facing any client-specific issues or any corporate action-related impact, so on and so forth, that would be helpful.
Speaker Change #110: which I think some of our competitors have reported almost seven and a half percent to eight percent sort of sequential revenue growth in BFSI in this quarter. So if you were to give us a cut on if Capco within BFSI is doing well, what is not doing well? I understand the geographical slicing and dicing you gave earlier but any specific color on if you're facing any client specific issues or any corporate action related impact so on and so forth that would be helpful.
Srinivas Pallia: So, if you were to give us a cut on if Capco within BFSI is doing well, what is not doing well? I understand the geographical slicing and icing you gave earlier, but any specific color on if you are facing any client-specific issues or any corporate action-related impacts on and so forth, that would be nice.
Srinivas Pallia: You know, Sudeed, I think let me summarize all the comments that we made. For us, we were the first to call out the momentum coming back in Capco in Q3. Q3, Q4, Q1, I think we have three dots of Capco doing well both on bookings and a revenue standpoint. I think they've grown 3 upwards of 3% sequentially. The momentum looks good for Q2. And within Capco, we have a secular growth. Maybe there are some pockets of continental Europe that are weak, but other than that, they have a broad-based, you know, bounce back. BFSI outside of Capco, America's 2 certainly is bouncing back.
Aparna Iyer: You know, Sudhir, I think, you know, let me summarize all the comments that we made. For us, we were the first to call out the momentum coming back in Capco in Q3. Q3, Q4, Q1, I think we have three dots of Capco doing well, both on bookings and a revenue standpoint. I think they've grown upwards of 3% sequentially.
Speaker Change #110: You know, Sudhir, I think, you know, let me summarize all the comments that we made.
Sudheer Guntupalli: For us, we were the first to call out the momentum coming back in Capco in Q3. Q3, Q4, Q1, I think we have three dots of Capco doing.
Speaker Change #111: Well, both on bookings and a revenue standpoint, I think they've grown upwards of 3% sequentially. The momentum looks good for Q2, and within Capco, we have a secular growth.
Aparna Iyer: The momentum looks good for Q2. And within Capco, we have secular growth. Maybe there are some pockets of continental Europe that are weak, but other than that, they have a broad base.
Speaker Change #112: Maybe there are some pockets of continental Europe that are weak, but other than that, they have a broad-based
Aparna Iyer: BFSI outside of Capco, America, too, is bouncing back; we have had some good winds with a few large regional banks, and we are accelerating momentum, and things look to be in better shape there. On the European BFSI outside of Capco, we are seeing some softness, which we have shared with you. It is a combination of a lot of things you have said along with the macroeconomic environment being weak and less discretionary.
Speaker Change #112: I'm
Speaker Change #113: You know bonk back
Speaker Change #113: [inaudible]
Speaker Change #113: BFSI outside of Capco, America too certainly is bouncing back. We've had some good wins with a few large regional banks and you know we are accelerating momentum and you know things look to be in a better shape there right. On the Europe BFSI outside of Capco we are seeing
Srinivas Pallia: We've had some good wins with a few large regional banks, and you know, we are accelerating momentum, and you know, things look to be in a better shape there, right? On the Europe BFSI outside of Capco, we're seeing some softness, which we've shared with you. It's a combination of a lot of things you've said, along with the macroeconomic environment being weak and lower discretion.
Speaker Change #114: Some softness which we have shared with you. It's a combination of a lot of things you have said along with the macroeconomic environment being weak and lower discretionary spend
Aparna Iyer: Thanks Aparna and Srini. Is that in any way related to the corporate action that's going on between a couple of large European banks by any chance? No, I don't want to call out anything specific. It's a combination of multiple factors.
Speaker Change #115: Thanks Aparna and Srini. Is that in any way related to the corporate action that's going on between a couple of large European banks by any chance? No, I don't want to call out anything specific. It's a combination of multiple factors. It's not really just one client or two.
Sudheer Guntupalli: It's not really just one client or two. Sure. And the other question is, it looks like we are now completely integrating Capcom Rising into our books, if I were to understand one of the prior responses that we had given. Is that correct in the sense? No, it's not. They always integrated; they fully consolidated.
Srinivas Pallia: Srinivas Pallia, we are now completely integrating the Capcom Rising on our books, if ever to understand one of the prior responses that we had given. Is that correct in the science? No, they always integrated; they fully consolidated. That's not what I meant. I meant in terms of just the bringing together the larger, perhaps the functions and the facilities and the optimization that you have by bringing perhaps to organizations closer, that's what I meant, including maybe integration of the systems and the IT systems and the people cross-pollination of talent, things like that. But they fully integrated, they fully consolidated, yes.
Speaker Change #116: Sure. And the other question is, it looks like we are now completely integrating Capcom Rising on our books, if I were to understand one of the prior responses that we had given. Is that correct in the sense?
Aparna Iyer: That's not what I meant. I meant, in terms of just bringing together the larger, perhaps the functions and, you know, the facilities and the optimization that you have, by bringing perhaps the organizations closer, you know, that's what I meant, including maybe, you know, integration of like, you know, the systems and the IT, and the people, cross-pollination of talent, things like that, but they are fully integrated, they are fully consolidated. Yes,
Speaker Change #117: No, it's not. They always integrate it. They fully consolidate it. That's not what I meant. I meant...
Speaker Change #118: In terms of just the bringing together the larger perhaps the functions and you know the facilities and the optimization that you have by bringing perhaps to organizations closer
Speaker Change #118: You know, that's what I meant, including maybe, you know, integration of like, you know, the systems and the IT systems.
Speaker Change #118: and the people, cross-pollination of talent, things like that.
Aparna Iyer: Yeah, no, I was asking because earlier one of the concerns a few quarters back was that if they are deeply integrated, then probably the go-to-market positioning of then Capcom Rising will have to see a bit of a reset. So I'm just thinking as to whether that concern got completely addressed now. So, one of the things that we see is both teams are actually leveraging complementary capability. Especially, you know, in the context of transformation deals.
Srinivas Pallia: I was asking because earlier one of the concerns of the Quattas back was that if they are deeply integrated then probably the go-to-market positioning of the Capcom Rising will have to see a bit of a reset. So I'm just thinking as to whether that concerns were completely addressed now. So one of the things, one of the things that we see is both the teams are actually leveraging the complementary capabilities, especially in the context of transformation deals. So I think the collaboration between both Capcom and Wipro's business have yielded strong origination and also significant number of synergy deals.
Speaker Change #118: But they are fully integrated, they are fully consolidated, yes.
Speaker Change #119: Yeah, no, I was asking because earlier one of the concerns a few quarters back was that if they are deeply integrated, then probably the go to market positioning of the then Capcom rising will have to see a bit of a reset. So I'm just thinking as to whether that concerns got completely addressed now.
Speaker Change #120: So, one of the things that we see is both the teams are actually leveraging the complementary capabilities, especially in the context of transformation deals.
Srinivas Pallia: So I think the collaboration between both Capco and Wipro's business has yielded strong origination and also a significant number of synergy deals. This is also evident where we are jointly entering some of the new financial services market, especially in the APNIC region specific to the Middle East and India and domestic, and the advantage we have here is, like I said, CAPCO is the tip of the spear, right, and the areas that I called out, whether risk and compliance, whether it's to do cost optimization or the transformation of the bank or the customer experience, right, you know. I think it's Thanks. Okay, sorry, I forgot to mention Rising. As far as Rising is concerned, so if you look at the Rising, they are very strong and dominant in certain industry sectors. For example, fashion retail. Right?
Speaker Change #121: So I think the collaboration between both Capco and Wipro's business have yielded strong origination and also significant number of synergy deals.
Srinivas Pallia: This is also evident where we are jointly entering some of the new financial services market, especially in the appear reasons specific to Middle East and India and domestic. And the advantage we have here is, like I said, Capcom is the tip of the spear, right? And the areas that I've called out, whether risk and compliance, whether it's to do cost optimization or the transformation of the bank or the customer experience, right? So I think it's a very good partnership between Capcom and Wipro.
Speaker Change #121: This is also you know evident where we are jointly entering some of the new financial services market especially in the APMEA region specific to Middle East and India domestic.
Amit Choudhary: And the advantage we have here is, like I said, Capco is the tip of the spear, right, I know, and the areas that I called out, whether risk and compliance, whether it's to do cost optimization, or the transformation of the bank or the customer experience, right, you know, I think it's a very good partnership between Capco and Wipro.
Srinivas Pallia: Thanks, Daniel. Thanks. Sorry, I forgot to mention Rising. As far as Rising is concerned, so if you look at the Rising, they are very strong and dominant on certain industry segments. For example, fashion retail, right? So the way we are doing it here is that, or SAP HANA. So whenever there's a large transformation program, the clients are looking at us as sort of bringing the consulting capabilities of Rising, along with the delivery and execution capabilities of Wipro together. And that's why we're able to win some of the transmission deals specifically in SAP, and we're seeing a good traction there.
Amit Choudhary: Sorry, I forgot to mention Rising.
Amit Choudhary: So if you look at the rising, they are very strong and dominant on certain industry segments.
Srinivas Pallia: So the way we are doing it here is that, or SAP HANA. So whenever there's a large transformation program, the clients are looking at us sort of bringing the consulting capabilities of Rising, along with the delivery and execution capabilities of Wipro together. And that's where we're able to win some of the transmission deals, specifically in SAP. And we are seeing good traction. Thanks to you, all the very best.
Amit Choudhary: For example, fashion retail, right? So the way we are doing it here is that or SAP HANA
Operator: Thank you. We have another question from the line of Manik Taneja from Axis Capital. Please go ahead.
Amit Choudhary: So whenever there's a large transformation program...
Amit Choudhary: The clients are looking at us sort of bringing the consulting capabilities of RISING along with the delivery and execution capabilities of Wipro together and that's why we're able to win some of the transmission deals specifically in SAP and we're seeing a good traction there.
Unknown Executive: Thank you.
Unknown Executive: All the very best. Thank you.
Amit Choudhary: Thanks to you. All the very best. Thank you.
Manik Taneja: We have an next question from the line of Manik Taneja from Axis Capital. Please go ahead. Hi. Thank you for the opportunity. Why are some of my questions have already been answered.
Speaker Change #122: Thank you.
Speaker Change #122: We have our next question from the line of Manik Taneja from AXIS Capital. Please go ahead. Hi, thank you for the opportunity. While some of my questions have already been answered, I just wanted to quiz you on the segmental margin performance, especially with regards to Europe and AP EMEA.
Manik Taneja: Hi, thank you for the opportunity. While some of my questions have already been answered, I just wanted to quiz you on the segmental margin performance, especially with regard to Europe and APMIA margins. While you've spoken about some of the revenue challenges in that geography, if you could help us understand what's driving the margin decline in those geographies, that's question number one.
Manik Taneja: I just wanted to quiz you on the segment to margin performance, especially with regards to Europe and AP etemia margins. While you've spoken about some of the revenue challenges in that geography, if you could help us understand what's driven the margin decline in those geography. That's question number one.
Speaker Change #123: Margins. While you've spoken about some of the revenue challenges in that geography, if you could help us understand what's driven the margin decline in those geographies, that's question number one.
Manik Taneja: And the second question was with regard to the financial services performance in Europe, with some of the leadership changes in Capco and even at the company-wide level, is that also creating some drag on the flanking services business in Europe for you? Okay, so I'll take your second question first. I want to, you know, fully allay your fears fully. The Capco leadership is really stable, and it's doing really well.
Aparna Iyer: And the second question was with regards to the financial services performance in Europe, with some of the leadership changes in Capco and even at the company-wide level. Is that also creating some drag for the financial services business in Europe for you?
Speaker Change #123: And the second question was with regards to the financial services performance in Europe with some of the leadership changes in Capco and even at the company wide level, is that also creating some drag for the financial services business in Europe for you?
Aparna Iyer: Okay, so I'll take your second question first. I want to like, you know, a lay of years, fully, you know, the Kapko leadership is stable and it's doing really well, you know, she knew it to it where he said, you know, the collaboration is deeper, better and, you know, the secular growth is back, so I don't think there is so little anything to do with that, you know, the softness in Europe is actually a side of Kapko and actually, even though we were doing well on synergy deals, there are some, you know, softness that is coming both due to the macroeconomic environment, lower discretionary spend and a few, you know, client specific issues as well, right?
Aparna Iyer: You know, Srini alluded to it where he said, you know, the collaboration is deeper, better, and we, the secular growth is back. So I don't think there is absolutely anything to do with that. You know, the softness in Europe is actually outside of Capco.
Speaker Change #124: Okay, so I'll take your second question first. I want to like, you know, allay your fears fully, you know, the CAPCO leadership is
Speaker Change #124: you know the collaboration is deeper better and you know we the secular growth is back so I don't think there is absolutely anything to do with that
Speaker Change #124: The softness in Europe is actually outside of Capco and actually even though we were doing well on Synergy Deals, there are some
Aparna Iyer: And actually, even though we were doing well on synergies deals, there are some, you know, softness that is coming both due to the macroeconomic environment, the lower discretionary spending, and a few, you know, client-specific issues as well, right. So it's a combination, and I'll leave it at that. The first question on segment margins, you know, yes, there is a decline in both Europe and APMEA. Actually, APMEA has improved year on year, but Europe has actually declined year on year.
Speaker Change #125: So, this is a combination of the softness which is coming due to the macroeconomic environment, low discretionary spends, and a few client-specific issues as well. So it's a combination.
Aparna Iyer: So it's a combination, and I'll leave it at that. The first question on segment margin, you know, yes, there is a decline in both Europe and Apnea. Actually, Apnea has improved year on year, but Europe has actually declined year on year. And, you know, the what you will see in the segment is that our unannocated costs have come down substantially between Q4 and Q1. They change the methodology in which we observe some of these group costs and, you know, therefore, the costs have been straight to the market units, so therefore, you're seeing a decline to be a little bit more accessible, you know, more deeper and it should be. But Europe, the weakness in margins is again linked back to our revenue performance and nothing more to add on that.
Speaker Change #126: and I'll leave it at that. The first question on segment margins...
Speaker Change #127: Yes, there is a decline in both Europe and APME. Actually, APME has improved year-on-year, but Europe has actually declined year-on-year.
Speaker Change #127: and you know the what you will see in the segment
Speaker Change #127: is that our unallocated costs have come down substantially.
Speaker Change #127: between Q4 and Q1.
Speaker Change #127: We've changed the methodology in which we absorb some of these group costs and you know therefore the costs are being spread to the market units so therefore you're seeing a decline to be a little bit more accessible you know more deeper than it should be but
Aparna Iyer: And, you know, therefore, the costs have been spread to the market units. So, therefore, you're seeing a decline that is a little bit more accessible, you know, deeper than it should be. But Europe, the weakness in margins is again linked back to our revenue performance, and... Nothing more to add to that. We are actually doing better, you know, and perhaps someone in the IRs can give you more details.
Speaker Change #127: Europe , the weakness in margins is again linked back to our revenue performance.
Speaker Change #127: and
Aparna Iyer: Apnea actually is doing better year on year, and perhaps someone in the IR can, you know, give you more details.
Speaker Change #127: Nothing more to add on that. We are actually doing better here on.
Speaker Change #128: and perhaps someone in the IR can you know give you more details
Aparna Iyer: Sure. Thank you, Aparna. Operator Yashashree, we have a few minutes left. Let us take one last question. Sure, sir. We will take the last question from the line of Girish Pai from BOB Capital Markets. Please go ahead.
Aparna Iyer: Sure, thank you, Pana.
Unknown Executive: Sure.
Unknown Executive: Operator Yashishri, we are having a few minutes left. Let us take one last question.
Aparna Iyer: Sure, thank you Aparna.
Speaker Change #129: Operator Yashashree, we are having few minutes left, let us take one last question. Sure sir, we will take a last question from the line of Girish Pai from BOB Capital Markets.
Kirish Pai: Sure, sir.
Aparna Iyer: We'll take a last question from the line of Kirish Pai from BOB Capital Markets. Please go ahead. Yeah, thanks for the opportunity. Apnea, the commentary on margins, it's moved from a narrow band to a narrow band with an upward bias. I'm seeing that being introduced for the first time. So, what's leading to that? You know, I think we've been able to execute on, you know, a bit-by-bit improvement over the last six quarters. The event of the operational record gives us the confidence as we get into Q2. There is also, you must know that the guidance that we've given for quarter two is also perhaps amongst the better guidance range that we've given in the last six quarters.
Girish Pai: Yeah, thanks for the opportunity. Aparna, the commentary on margins, it's moved from a narrow band to a narrow band with an upward bias. I'm seeing that being introduced for the first time. So what's leading to that?
Speaker Change #130: Please go ahead.
Girish Pai: Yeah, thanks for the opportunity. Aparna, the commentary on margins, it's moved from a narrow band to a narrow band with an upward bias. I'm seeing that being introduced for the first time. So what's leading to that?
Aparna Iyer: You know, I think we've been able to execute on, you know, a bit by bit improvement over the last six quarters. The tailwind of the operational rigger gives us confidence as we get into Q2. There is also, you must know that the guidance that we have given for quarter 2 is also perhaps among the better guidance range that we have given in the last quarter. So all of that adds to the confidence as we look at quarter two and beyond.
Aparna Iyer: you know I think we've been able to execute on you know
Speaker Change #132: A bit by bit improvement over the last six quarters.
Speaker Change #133: The tailwind of the operational rigger gives us the confidence as we get into Q2.
Speaker Change #133: There is also, you must know that the guidance that we have given for quarter 2 is also perhaps among the better guidance range that we have given in the last six quarters.
Aparna Iyer: So, all of that adds to the confidence as we look at quarter two and beyond. And an upward bias could be in a 50 to 100 basis point upward bias? You know, I think it's very that's why you should read it along with narrow band and with an upward bias.
Speaker Change #133: So all of that adds to the confidence as we look at quarter 2 and beyond.
Aparna Iyer: An upward bias could mean a 50 to 100 basis point upward bias. You know, I think it's very important, that's why you should read it along with Narrow Back and with an upward bias. Okay, last year you pushed the wage hike by about three months. Would we see the same cycle this year, and the quantum would it be pretty similar? Salary hikes, last year we did it in December; we have not decided when to give the salary hikes; we will decide in this quarter.
Speaker Change #133: An upward bias could mean a 50 to 100 basis point upward bias.
Speaker Change #134: you know I think it's very that's why you should read it along with Narrowback
Aparna Iyer: Okay, last year you pushed the wage hike, I think, by about three months. Would we see the same cycle this year, and the quantum would it be very similar? Saldi Hikes, last year we had done it in December, we have not decided when to give the halry eggs. We decided in this quarter, it will be live in the market whenever we decide.
Speaker Change #134: and we're going to upload back.
Speaker Change #135: Okay, last year you pushed the wage hike I think by about three months, would we see the same cycle this year and the quantum would it be pretty similar?
Speaker Change #136: Salary hikes, last year we have done it in December , we have not decided when to give the salary hikes, we will decide in this quarter, but we will be in line with the market whenever we decide.
Aparna Iyer: It will be live in the market whenever we do it. Okay, my last question has to do with competitive intensity, and one of your larger peers was discussing that they were giving out fairly large productivity gains back to customers in areas like BPO and testing and stuff like that because of generative AI. Is that what you're seeing in the market?
Srinivas Pallia: Okay, my last question is to do with competitive intensity, and one of your larger peers is discussing that it was giving out fairly large productivity gains back to customers in areas like BPU and testing and stuff like that because of generative AI. Is that what you are seeing in the market: heightened competitive intensity because of Genie AI? So, Girish, like I said, clearly we have a strategy for Genie AI, and I talked about the three places where we are doing it. So whenever we put a solution to the client, all the deals that we have, we leverage Genie AI.
Speaker Change #138: Okay, my last question is to do with competitive intensity and one of your larger peers is...
Speaker Change #137: Discussing that it was giving out fairly large productivity gains back to customers in areas like BPO and testing and stuff like that because of generative AI. Is that what you're seeing in the market?
Speaker Change #137: heightened competitive intensity because of Gen AI.
Girish Pai: Increasing competitive intensity because of Gen AI? So Girish, like I said, clearly, we have a strategy for Gen-AI, and I talked about the three places where we're doing it. So whenever we put a solution to the client, all the deals that we have, we leverage Gen-AI. So what goes to the client is, you know, Gen-AI powered solutions, if you will. And we're also infusing, like I said, Gen-AI into some of the engagements that we have with our clients. So that would be the combination of the two.
Speaker Change #137: So Girish, like I said, clearly we have a...
Girish Pai: Strategy for Chennai and I talked about the three places where we're doing it so
Girish Pai: Whenever we put a solution to the client, all the deals that we have, we leverage NAI. So what goes to the client is, you know, NAI-powered solutions, if you will. And we're also infusing, like I said, NAI into some of the engagements that we have with our clients. So that would be the combination of the two.
Srinivas Pallia: So, what goes to the client is Genie AI-powered solutions, if you will, and we are also infusing, like I said, Genie AI into some of the engagements that we have with our clients. So, that would be the combination of the two. So, Genie AI does help, you know, help us in terms of productivity. Some of, you know, so to me this kind of trend is not new. There will be always, in the context of bidding and risk details, there will be some companies who will try to pick up deals at an extremely low margin or extremely high risk.
Srinivas Pallia: So Gen-AI does help, you know, help us in terms of productivity. Some of us, you know, so to me, this kind of trend is not new. There will always be, in the context of bidding and risky deals, there will be some companies who will try to pick up deals at an extremely low margin or extremely high risk.
Girish Pai: So, JNI does help, you know, help us in terms of productivity.
Srinivas Pallia: and Srinivas Pallia.
Srinivas Pallia: But, you know, those trends do not last for long as such. This approach is not, you know, clearly not sustainable in the longer term, Girish. However, we are not worried about this trend, and neither does it require any changes to our strategy.
Srinivas Pallia: But, you know, those trends do not last for long, as such approach is not clearly not sustainable in the longer term of Girish. However, we are not worried about this trend, and another does it require any changes to our strategy.
Srinivas Pallia: But you know, those trends do not last for long as such approach is not, clearly is not sustainable in the longer term, Girish.
Speaker Change #139: However, we are not worried about this trend and neither does it require any changes to our strategy.
Unknown Executive: Okay, thank you very much.
Unknown Executive: Thank you.
Deepak Bohra: Ladies and gentlemen, that was the last question for today.
Girish Pai: Okay, thank you very much. Thank you. Ladies and gentlemen, that was the last question for today. I would now like to hand the conference back to Mr. Deepak Bohra for closing comments. Over to you. Thanks. Thank you all for joining the call. In case we could not take any questions due to time constraints, please feel free to reach out to the Investor Relations team. Have a nice evening. Thank you so much. Thank you, Members of the Management Board. On behalf of Wipro, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.
Speaker Change #140: Thank you very much.
Speaker Change #141: Thank you.
Deepak Bohra: I would now like to hand the conference back to Mr. Deepak Bora for closing comments. Over to you, sir. Yeah, thanks. Thank you all for joining the call.
Speaker Change #141: Ladies and gentlemen, that was the last question for today. I would now like to hand the conference back to Mr. Deepak Bohra for closing comments. Over to you, sir.
Deepak Bohra: In case we could not take any questions due to time constraints, please feel free to reach out to the Investor Relations team.
Dipak Bohra: Thank you all for joining the call. In case we could not take any questions due to time constraints, please feel free to reach out to the Investor Relations team. Have a nice evening. Thank you so much.
Unknown Executive: Have a nice evening. Thank you so much.
Unknown Executive: Thank you, members of the management team. On behalf of the Pro, that concludes this conference.
Speaker Change #142: Thank you members of the management team. On behalf of Wipro that concludes this conference. Thank you for joining us and you may now disconnect your lines.
Unknown Executive: Thank you for joining us, and you may not disconnect your lines.
Operator: Hello? Hello? Let Gaurav speak. Hello? Hello?
Speaker Change #143: Thank you.
Speaker Change #144: Let go out of the room.