Wipro Q3 2026 Wipro Ltd Earnings Call | AllMind AI Earnings | AllMind AI
Q3 2026 Wipro Ltd Earnings Call
Speaker #1: 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, and then zero on your touch-tone phone.
Speaker #1: Please note that this conference is being recorded, and the duration for today's call will be 45 minutes. I now hand the conference over to Mr. Abhishek Jain, Vice President, Corporate Treasurer and Head of Investor Relations.
Speaker #1: Thank you, and over to you, sir.
Speaker #2: Thank you, Yashasini. A warm welcome to our Q3 FY26 earnings call. We'll begin the call with the business highlights and overview by Srinivas Pallia, our Chief Executive Officer and Managing Director.
Operator: We'll 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. We also have our CHRO, Saurabh Govil, and our Chief Strategist and Technology Officer, Hari Shetty, on this call. Afterwards, the operator will open the bridge for Q&A with our management team. Before Srini 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 Securities Litigation Reform Act of 1995. These statements are based on management's current expectations and are associated with uncertainties and risks, which may cause the actual results to differ materially from those expected. The uncertainties and risk factors are explained in our detailed filings with the SEC.
Abhishek Jain: We'll 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. We also have our CHRO, Saurabh Govil, and our Chief Strategist and Technology Officer, Hari Shetty, on this call. Afterwards, the operator will open the bridge for Q&A with our management team. Before Srini 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 Securities Litigation Reform Act of 1995. These statements are based on management's current expectations and are associated with uncertainties and risks, which may cause the actual results to differ materially from those expected. The uncertainties and risk factors are explained in our detailed filings with the SEC.
Speaker #2: Following the updates on the financial overview by our CFO, Aparna Iyer, we also have our CHRO, Saurabh Govil, and our Chief Strategist and Technology Officer, Hari Shetty, on this call.
Speaker #2: Afterwards, the operator will open the bridge for Q&A with our management team. Before Srini 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 Securities Litigation Reform Act of 1995.
Speaker #2: These statements are based on management's current expectations and are associated with uncertainties and risks. They may cause the actual results to differ materially from those expected.
Speaker #2: The uncertainties and risk factors are explained in our detailed filings 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.
Operator: Wipro does not undertake any obligation to update the forward-looking statements to reflect events and circumstances after the date of filing. 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. Thank you, Abhishek. Good evening, and thank you for joining us today. A very happy New Year to you. Let me start with the broader environment before walking you through our quarterly performance and how we are positioning Wipro for an AI-first world. Across our client landscape, one thing is clear: organizations are reshaping priorities as AI influences how they plan, invest, and operate. In fact, AI is now a standing board-level mandate led by CEOs who recognize its ability to transform business models, unlock productivity, and create lasting competitive advantage.
Abhishek Jain: Wipro does not undertake any obligation to update the forward-looking statements to reflect events and circumstances after the date of filing. 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.
Speaker #2: 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
Speaker #2: Srini. Thank
Srinivas Pallia: Thank you, Abhishek. Good evening, and thank you for joining us today. A very happy New Year to you. Let me start with the broader environment before walking you through our quarterly performance and how we are positioning Wipro for an AI-first world. Across our client landscape, one thing is clear: organizations are reshaping priorities as AI influences how they plan, invest, and operate. In fact, AI is now a standing board-level mandate led by CEOs who recognize its ability to transform business models, unlock productivity, and create lasting competitive advantage.
Speaker #3: You, Abhishek. Good evening, and thank you for joining us today. A very happy New Year to you. Let me start with the broader environment.
Speaker #3: Before walking you through our quarterly performance, and how we are positioning Wipro for an AI-first world, across our client landscape, one thing is clear.
Speaker #3: Organizations are reshaping priorities as AI influences how they plan, invest, and operate. In fact, AI is now a standing board-level mandate led by CEOs who recognize its ability to transform business models, unlock productivity, and create lasting competitive advantage.
Speaker #3: We are also seeing the same themes continue from past quarters in our deal pipeline: cost optimization, vendor consolidation, and a clear shift towards AI-led transformation.
Operator: We are also seeing the same themes continue from past quarters in our deal pipeline: cost optimization, vendor consolidation, and a clear shift towards AI-led transformation. In Q3, we also marked two important milestones for Wipro. In December, we completed 80 years as a company, and in October, we celebrated 25 years of being listed on the New York Stock Exchange. These milestones reflect a legacy of strong governance, values, and integrity, a foundation of trust that continues to differentiate us with our clients, partners, and investors. Turning to Q3 performance, our IT services' sequential revenue at $2.64 billion grew 1.4% on a constant currency basis. Excluding Harman DTS acquisition, revenue grew 0.6% in constant currency terms. Growth was broad-based, with three of our four markets and four of our five sectors reporting sequential gains.
Srinivas Pallia: We are also seeing the same themes continue from past quarters in our deal pipeline: cost optimization, vendor consolidation, and a clear shift towards AI-led transformation. In Q3, we also marked two important milestones for Wipro. In December, we completed 80 years as a company, and in October, we celebrated 25 years of being listed on the New York Stock Exchange. These milestones reflect a legacy of strong governance, values, and integrity, a foundation of trust that continues to differentiate us with our clients, partners, and investors. Turning to Q3 performance, our IT services' sequential revenue at $2.64 billion grew 1.4% on a constant currency basis. Excluding Harman DTS acquisition, revenue grew 0.6% in constant currency terms. Growth was broad-based, with three of our four markets and four of our five sectors reporting sequential gains.
Speaker #3: In Q3, we also marked two important milestones for Wipro. In December, we completed 80 years as a company. And in October, we celebrated 25 years of being listed on the New York Stock Exchange.
Speaker #3: These milestones reflect a legacy of strong governance, values, and integrity—a foundation of trust that continues to differentiate us with our clients, partners, and investors.
Speaker #3: Turning to Q3 performance, our IT services sequential revenue at $2.64 billion grew 1.4% on a constant currency basis. Excluding the Harman DTS acquisition, revenue grew 0.6% in constant currency terms.
Speaker #3: Growth was broad-based, with three of our core markets and four of our five sectors reporting sequential gains. Americas 1 delivered sequential and year-on-year growth, driven by strong performance.
Operator: Americas 1 delivered sequential and year-on-year growth driven by strong performance in healthcare, consumer, and LATAM. Americas 2 saw a sequential decline. Europe grew sequentially in Q3, led by ramp-up of the earlier announced Mega Deal. We are also seeing good traction in the UK and Western Europe. APMEA grew sequentially and year-on-year, led by India, Middle East, and Southeast Asia. PSSI continues to show strong traction with ramp-ups and new wins. Capco revenue was impacted by furloughs and remained flat year-on-year. Our operating margins at 17.6% expanded 0.4% over adjusted Q2 margin and 0.1% year-on-year. We closed $3.3 billion in total contract value and $871 million in large deal bookings. Last quarter, I introduced Wipro Intelligence. It's a unified approach to delivering AI-powered transformation across industries. This approach is anchored on three strategic pillars. First, industry platforms and solutions. We are building consulting-led AI solutions across sectors.
Srinivas Pallia: Americas 1 delivered sequential and year-on-year growth driven by strong performance in healthcare, consumer, and LATAM. Americas 2 saw a sequential decline. Europe grew sequentially in Q3, led by ramp-up of the earlier announced Mega Deal. We are also seeing good traction in the UK and Western Europe. APMEA grew sequentially and year-on-year, led by India, Middle East, and Southeast Asia. PSSI continues to show strong traction with ramp-ups and new wins. Capco revenue was impacted by furloughs and remained flat year-on-year. Our operating margins at 17.6% expanded 0.4% over adjusted Q2 margin and 0.1% year-on-year. We closed $3.3 billion in total contract value and $871 million in large deal bookings. Last quarter, I introduced Wipro Intelligence. It's a unified approach to delivering AI-powered transformation across industries. This approach is anchored on three strategic pillars. First, industry platforms and solutions. We are building consulting-led AI solutions across sectors.
Speaker #3: In healthcare, consumer, and LATAM, Americas 2 saw a sequential decline. Europe grew sequentially in Q3, led by ramp-up of the earlier announced mega deal.
Speaker #3: We are also seeing good traction in the UK and Western Europe. Apnea grew sequentially and year-on-year, led by India, the Middle East, and Southeast Asia.
Speaker #3: BFSI continues to show strong traction with ramp-ups and new wins. Capco revenue was impacted by furloughs and remained flat year-on-year. Our operating margins at 17.6% expanded 0.4% over adjusted quarter-to-margin and 0.1% year-on-year.
Speaker #3: We closed $3.3 billion in total contract value, and $871 million in large deal bookings. Last quarter, I introduced Vipro Intelligence. It's a unified approach to delivering AI-powered transformation across industries.
Speaker #3: This approach is anchored on three strategic pillars: first, industry platforms and solutions; we are building consulting-led AI solutions across sectors. For example, platforms like Payer AI in healthcare, Net Oxygen for lending, and Auto Cortex for automotive.
Operator: For example, platforms like Payer AI in healthcare, NetOxygen for lending, and AutoCortex for automotive. These solutions help streamline operations, improve customer outcomes, and open up new avenues for growth. Second, our delivery platforms accelerate AI adoption at scale. Wings, part of our Wipro Intelligence, brings AI into the heart of operations, from application management to infrastructure support, and business process operations. Vega adds AI-driven capabilities across the development lifecycle, from wipe coding to model tuning and data pipelines. Together, these platforms help our clients modernize faster and operate smarter. Third, the Wipro Innovation Network. This connects our labs with partners, startups, universities, and deep tech talent around the world. This ecosystem helps us explore new technologies and build solutions for the future.
Srinivas Pallia: For example, platforms like Payer AI in healthcare, NetOxygen for lending, and AutoCortex for automotive. These solutions help streamline operations, improve customer outcomes, and open up new avenues for growth. Second, our delivery platforms accelerate AI adoption at scale. Wings, part of our Wipro Intelligence, brings AI into the heart of operations, from application management to infrastructure support, and business process operations. Vega adds AI-driven capabilities across the development lifecycle, from wipe coding to model tuning and data pipelines. Together, these platforms help our clients modernize faster and operate smarter. Third, the Wipro Innovation Network. This connects our labs with partners, startups, universities, and deep tech talent around the world. This ecosystem helps us explore new technologies and build solutions for the future.
Speaker #3: These solutions help streamline operations, improve customer outcomes, and open up new avenues for growth. Second, our delivery platforms accelerate AI adoption at scale. Wings, part of our Wipro Intelligence, brings AI into the heart of operations.
Speaker #3: From application management to infrastructure support and business process operations, Vega adds AI-driven capabilities across the development lifecycle. From white coding to model tuning and data pipelines.
Speaker #3: Together, these platforms help our clients modernize faster and operate smarter. Third, the Wipro Innovation Network: this connects our labs with partners, startups, universities, and deep tech talent around the world.
Speaker #3: This ecosystem helps us explore new technologies and build solutions for the future. We launched Innovation Labs in three cities in the US, Australia, and the Middle East.
Operator: We launched innovation labs in three cities in the US, Australia, and the Middle East, expanding our network, growing our global footprint, and strengthening our role as a trusted innovation partner. We are also partnering with client GCCs to drive transformation and turn their cost centers into high-impact innovation labs. Let me now share two examples of large deal wins that we had leveraging Wipro Intelligence. First, a leading global education provider in the UK, which is expanding rapidly across markets, has chosen us as its strategic partner for a multi-year transformation. The goal is to build a single, secure, intelligent operating model that can scale with their growth and improve stakeholder experience. Using Wings, we will standardize core processes, embed automation and AI-driven insights, and optimize costs through a global delivery model.
Saurabh Govil: We launched innovation labs in three cities in the US, Australia, and the Middle East, expanding our network, growing our global footprint, and strengthening our role as a trusted innovation partner. We are also partnering with client GCCs to drive transformation and turn their cost centers into high-impact innovation labs. Let me now share two examples of large deal wins that we had leveraging Wipro Intelligence. First, a leading global education provider in the UK, which is expanding rapidly across markets, has chosen us as its strategic partner for a multi-year transformation. The goal is to build a single, secure, intelligent operating model that can scale with their growth and improve stakeholder experience. Using Wings, we will standardize core processes, embed automation and AI-driven insights, and optimize costs through a global delivery model.
Speaker #3: Expanding our network, growing our global footprint, and strengthening our role as a trusted innovation partner. We are also partnering with client GCCs to drive transformation and turn their cost centers into high-impact innovation labs.
Speaker #3: Let me now share two examples of large deal wins that we had, leveraging Wipro Intelligence. First, a leading global education provider in the UK, which is expanding rapidly across markets, has chosen us as its strategic partner for a multi-year transformation.
Speaker #3: The goal is to build a single, secure, intelligent operating model that can scale with their growth and improve stakeholder experience. Using Wings, we will standardize core processes, embed automation and AI-driven insights, and optimize costs through a global delivery model.
Speaker #3: Second, a leading US-based fitness technology company has selected Wipro for a multi-year transformation, to accelerate its shift to a subscription-based wellness model and support global expansion.
Operator: Second, a leading US-based fitness technology company has selected Wipro for a multi-year transformation to accelerate its shift to a subscription-based wellness model and support global expansion. We will use both Wings and Vega to embed AI and automation across IT infrastructure and core functions, driving efficiency, productivity, growth, and better customer experiences. These engagements highlight a clear trend. Clients are bringing us in much earlier and recognizing the step change in the way we deliver and innovate. I would now like to update you on Harman DTS. First, a warm welcome to all Harman DTS employees joining us. With the acquisition now complete, we have added engineering and AI capabilities that truly complement what we do. This strengthens our engineering global business line and helps us accelerate AI-driven product innovation for clients.
Srinivas Pallia: Second, a leading US-based fitness technology company has selected Wipro for a multi-year transformation to accelerate its shift to a subscription-based wellness model and support global expansion. We will use both Wings and Vega to embed AI and automation across IT infrastructure and core functions, driving efficiency, productivity, growth, and better customer experiences. These engagements highlight a clear trend. Clients are bringing us in much earlier and recognizing the step change in the way we deliver and innovate. I would now like to update you on Harman DTS. First, a warm welcome to all Harman DTS employees joining us. With the acquisition now complete, we have added engineering and AI capabilities that truly complement what we do. This strengthens our engineering global business line and helps us accelerate AI-driven product innovation for clients.
Speaker #3: We will use both Wings and Vega to embed AI and automation across IT infrastructure and core functions, driving efficiency, productivity, growth, and better customer experiences.
Speaker #3: These engagements highlight a clear trend. Clients are bringing us in much earlier, and recognizing the step change in the way we deliver and innovate.
Speaker #3: I would now like to update you on Harman DTS. First, a warm welcome to all Harman DTS employees joining us. With the acquisition now complete, we have added engineering and AI capabilities that truly complement what we do.
Speaker #3: This strengthens our engineering global business line and helps us accelerate AI-driven product innovation for clients. The integration also opens new regions and high-growth industries, and allows us to take on larger, more complex transformation programs.
Operator: The integration also opens new regions and high-growth industries and allows us to take on larger, more complex transformation programs. As our teams come together, we look forward to entering new markets, building deeper client relationships, and turning innovation into long-term value. Finally, guidance for Q4. In Q4, we are projecting sequential IT services revenue growth of 0% to 2.0% in constant currency. With that, I will hand it over to Aparna for the detailed financials. Thank you. Over to you, Aparna. Thank you, Srini. Good evening, ladies and gentlemen. I wish you all a very, very happy New Year. Let me share a quick update on the financial performance. Our IT services revenue for Q3 grew 1.4% sequentially in constant currency terms and 1.2% sequentially in reported currency. Revenue grew 0.2% year-on-year in reported terms while declining 1.2% year-on-year in constant currency terms.
Srinivas Pallia: The integration also opens new regions and high-growth industries and allows us to take on larger, more complex transformation programs. As our teams come together, we look forward to entering new markets, building deeper client relationships, and turning innovation into long-term value. Finally, guidance for Q4. In Q4, we are projecting sequential IT services revenue growth of 0% to 2.0% in constant currency. With that, I will hand it over to Aparna for the detailed financials. Thank you. Over to you, Aparna.
Speaker #3: As our teams come together, we look forward to entering new markets, building deeper client relationships, and turning innovation into long-term value. Finally, guidance for Q4.
Speaker #3: In quarter four, we are projecting sequential IT services revenue growth of 0% to 2.0% in constant currency. With that, I will hand it over to Aparna for the detailed financials.
Speaker #3: Thank you. Over to you, Aparna.
Aparna Iyer: Thank you, Srini. Good evening, ladies and gentlemen. I wish you all a very, very happy New Year. Let me share a quick update on the financial performance. Our IT services revenue for Q3 grew 1.4% sequentially in constant currency terms and 1.2% sequentially in reported currency. Revenue grew 0.2% year-on-year in reported terms while declining 1.2% year-on-year in constant currency terms.
Speaker #2: Thank you, Srini. Good evening, ladies and gentlemen. I wish you all a very, very happy New Year. Let me share a quick update on the financial performance.
Speaker #2: Our IT services revenue for quarter three grew 1.4% sequentially in constant currency terms and 1.2% sequentially in reported currency. Revenue grew 0.2% year on year.
Speaker #2: In reported terms, while declining 1.2% year on year in constant currency terms. Our constant currency revenue growth numbers included 0.8% as contribution from the Harman DTS acquisition that was closed in quarter three '26.
Operator: Our constant currency revenue growth numbers included 0.8% as contribution from the Harman DTS acquisition that was closed in Q3 2026. Our operating margins for the quarter were 17.6%, an expansion of 40 basis points over the adjusted operating margins for Q2, and 10 basis points improvement on a year-on-year basis. I would also like to highlight that this is one of our best margin performances in the last several quarters. As we move to Q4, we will need to factor for incremental dilution of Harman DTS. That said, our endeavor, as always, will be to maintain the margins in a similar band as in the last few quarters. Adjusted net income for the quarter was INR 33.6 billion, and adjusted EPS for the quarter was at INR 3.21, an increase of 3.5% quarter-on-quarter and flat year-on-year.
Aparna Iyer: Our constant currency revenue growth numbers included 0.8% as contribution from the Harman DTS acquisition that was closed in Q3 2026. Our operating margins for the quarter were 17.6%, an expansion of 40 basis points over the adjusted operating margins for Q2, and 10 basis points improvement on a year-on-year basis. I would also like to highlight that this is one of our best margin performances in the last several quarters. As we move to Q4, we will need to factor for incremental dilution of Harman DTS. That said, our endeavor, as always, will be to maintain the margins in a similar band as in the last few quarters. Adjusted net income for the quarter was INR 33.6 billion, and adjusted EPS for the quarter was at INR 3.21, an increase of 3.5% quarter-on-quarter and flat year-on-year.
Speaker #2: Our operating margins for the quarter were 17.6%, an expansion of 40 basis points over the adjusted operating margins for Q2, and a 10 basis point improvement on a year-on-year basis.
Speaker #2: I would also like to highlight that this is one of our best margin performances in the last several quarters. As we move to Q4, we will need to factor in the incremental dilution of Harman DTS.
Speaker #2: That said, our endeavor, as always, will be to maintain the margins in a similar band as in the last few quarters. Adjusted net income for the quarter was Rs.
Speaker #2: 33.6 billion, and adjusted EPS for the quarter was at 3.21 rupees. An increase of 3.5% quarter on quarter and flat year on year. Moving on to our strategic market unit and sector performance, all the numbers I will share will be in constant currency.
Operator: Moving on to our strategic market unit and sector performance, all the numbers I will share will be in constant currency. Americas 1 grew 1.8% sequentially and grew 2.8% on a year-on-year basis. Americas 2 declined 0.8% sequentially and 5.2% on a year-on-year basis. Europe grew 3.3% sequentially and declined 4.6% on a year-on-year basis. APMEA grew 1.7% sequentially and 6.6% on a year-on-year basis. From a sector standpoint, BFSI grew 2.6% sequentially and 0.4% year-on-year. Health grew 4.2% sequentially and 1% year-on-year. Consumer grew 0.7% sequentially while declining 5.7% year-on-year. Tech and Com grew 4.2% sequentially and 3.5% year-on-year. EMR declined 4.9% sequentially and 5.8% year-on-year. To give an added color, Capco was flat on a year-on-year basis in Q3.
Aparna Iyer: Moving on to our strategic market unit and sector performance, all the numbers I will share will be in constant currency. Americas 1 grew 1.8% sequentially and grew 2.8% on a year-on-year basis. Americas 2 declined 0.8% sequentially and 5.2% on a year-on-year basis. Europe grew 3.3% sequentially and declined 4.6% on a year-on-year basis. APMEA grew 1.7% sequentially and 6.6% on a year-on-year basis. From a sector standpoint, BFSI grew 2.6% sequentially and 0.4% year-on-year. Health grew 4.2% sequentially and 1% year-on-year. Consumer grew 0.7% sequentially while declining 5.7% year-on-year. Tech and Com grew 4.2% sequentially and 3.5% year-on-year. EMR declined 4.9% sequentially and 5.8% year-on-year. To give an added color, Capco was flat on a year-on-year basis in Q3.
Speaker #2: Americas grew 1.8% sequentially and grew 2.8% on a year-on-year basis. Americas 2 declined 0.8% sequentially and 5.2% on a year-on-year basis.
Speaker #2: Europe grew 3.3% sequentially and declined 4.6% on a year-on-year basis. Apnea grew 1.7% sequentially and 6.6% on a year-on-year basis.
Speaker #2: From a sector standpoint, BFSI grew 2.6% sequentially and 0.4% year on year. Health grew 4.2% sequentially and 1% year on year. Consumer grew 0.7% sequentially while declining 5.7% year on year.
Speaker #2: Tech and comm grew 4.2% sequentially and 3.5% on year on year term. EMR declined 4.9% sequentially and 5.8% year on year. To give an added color, Capco was flat on a year on year basis in Q3.
Speaker #2: Before I move on to other financial parameters, I would like to draw your attention to two specific one-off charges that we took in our P&L.
Operator: Before I move on to other financial parameters, I'd like to draw your attention to two specific one-off charges that we took in our P&L that also impacted our net income. These charges are not included in our IT services segment margins. First is an increase of INR 302 crores towards gratuity expenses due to implementation of the new labor code. Second is regarding the restructuring exercise that was completed during the quarter, and its impact is about INR 263 crores. I'd like to confirm that we've now completed the restructuring we wanted to do and do not anticipate any further charges. Our operating cash flows continue to be higher than the net income and stood at 135% of net income for Q3. Our gross cash, including investments, is now at $6.5 billion. Our net other income in Q3 grew 15% sequentially.
Aparna Iyer: Before I move on to other financial parameters, I'd like to draw your attention to two specific one-off charges that we took in our P&L that also impacted our net income. These charges are not included in our IT services segment margins. First is an increase of INR 302 crores towards gratuity expenses due to implementation of the new labor code. Second is regarding the restructuring exercise that was completed during the quarter, and its impact is about INR 263 crores. I'd like to confirm that we've now completed the restructuring we wanted to do and do not anticipate any further charges. Our operating cash flows continue to be higher than the net income and stood at 135% of net income for Q3. Our gross cash, including investments, is now at $6.5 billion. Our net other income in Q3 grew 15% sequentially.
Speaker #2: They've also impacted our net income. These changes are not included in our—these charges are not included in our IT services segment margins. First is an increase of ?302 crores towards gratuity expenses due to implementation of the new labor code.
Speaker #2: Second is regarding the restructuring exercise that was completed during the quarter, and its impact is about ?263 crore. I'd like to confirm that we've now completed the restructuring we wanted to do and do not anticipate any further charges.
Speaker #2: Our operating cash flow continued to be higher than the net income and stood at 135% of net income for Q3. Our gross cash, including investments, is now at $6.5 billion.
Speaker #2: Our net other income in Q3 grew 15% sequentially. Accounting yield for the average investments held in India was at 7.2%. Our effective tax rate at 23.9% for Q3 '26 was better than the same quarter last year, which was 24.4%.
Operator: Accounting yield for the average investments held in India was at 7.2%. Our effective tax rate at 23.9% for Q3 2026 was better than the same quarter last year of 24.4%. In terms of our guidance, we would like to reiterate what was stated by Srini. We expect our revenue from the IT services business segment to be in the range of $2.635 billion to $2.688 billion. This translates to a sequential guidance of 0 to 2% in constant currency terms. Our guidance includes the incremental two months of revenue from Harman DTS. It is impacted by fewer working days in Q4, and certain delayed ramp-ups in some of the large deals that we won earlier in the year. Lastly, I'd like to share with you that in our recently concluded board meeting, the board of directors has declared an interim dividend of Rs 6 per share.
Aparna Iyer: Accounting yield for the average investments held in India was at 7.2%. Our effective tax rate at 23.9% for Q3 2026 was better than the same quarter last year of 24.4%. In terms of our guidance, we would like to reiterate what was stated by Srini. We expect our revenue from the IT services business segment to be in the range of $2.635 billion to $2.688 billion. This translates to a sequential guidance of 0 to 2% in constant currency terms. Our guidance includes the incremental two months of revenue from Harman DTS. It is impacted by fewer working days in Q4, and certain delayed ramp-ups in some of the large deals that we won earlier in the year. Lastly, I'd like to share with you that in our recently concluded board meeting, the board of directors has declared an interim dividend of Rs 6 per share.
Speaker #2: In terms of our guidance, we would like to reiterate what was stated by Srini. We expect our revenue from the IT services business segment to be in the range of $2.635 billion to $2.688 billion.
Speaker #2: This translates to a sequential guidance of 0 to 2% in constant currency terms. Our guidance includes the incremental two months of revenue from Harman DTS.
Speaker #2: It is impacted by fewer working days in Q4 and certain delayed ramp-ups in some of the large deals that we've won earlier in the year.
Speaker #2: Lastly, I’d like to share with you that, in our recently concluded board meeting, the Board of Directors have declared an interim dividend of Rs.
Speaker #2: $6 per share. With this payout, the cash distributed to our shareholders during the current financial year will be in excess of $1.3 billion.
Operator: With this payout, the cash distributed to our shareholders during the current financial year will be in excess of $1.3 billion, and we will be able to significantly exceed the minimum threshold that we had laid out in our capital allocation policy for the block-ending financial year 2026. With that, I'm going to ask Yashasri to open it up for Q&A. Thank you very much. Ladies and gentlemen, we will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touch-tone telephone. 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 assembles. We'll take our first question from the line of Nitin Padmanabhan from Investec. Please go ahead.
Aparna Iyer: With this payout, the cash distributed to our shareholders during the current financial year will be in excess of $1.3 billion, and we will be able to significantly exceed the minimum threshold that we had laid out in our capital allocation policy for the block-ending financial year 2026. With that, I'm going to ask Yashasri to open it up for Q&A.
Speaker #2: And we will be able to significantly exceed the minimum threshold that we had laid out in our capital allocation policy for the block ending financial year 2026.
Speaker #2: With that, I'm going to ask Yashasvi to open it up for questions.
Speaker #2: Q&A. Thank you very
Operator: Thank you very much. Ladies and gentlemen, we will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touch-tone telephone. 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 assembles. We'll take our first question from the line of Nitin Padmanabhan from Investec. Please go ahead.
Speaker #3: Thank you very much. Ladies and gentlemen, we will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touch-tone telephone.
Speaker #3: 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.
Speaker #3: Ladies and gentlemen, we will wait for a moment while the question queue assembles. We'll take our first question from the line of Nitin Padmanabhan from Investech.
Speaker #3: Please go ahead.
Speaker #4: Hello, good evening. Wishing you a very happy New Year. I had a couple of questions. So one is, I think this quarter we lost almost $24 million of revenue in Energy, Manufacturing, Resources.
Operator: Hello, good evening. Wishing you a very happy New Year. I had a couple of questions. So one is, I think this quarter we lost almost $24 million of revenue in energy manufacturing resources. I just wanted your thoughts on that vertical and how do you see the deal pipeline there? When do you think this can sort of turn around? The second is you alluded to some delays in ramp-ups impacting growth for next quarter. If you could give some color there, I presume this is related to the last deals. By when do you see this sort of beginning to ramp going forward? And third, when are we expecting to have the wage hike cycle? Yeah, those are the three. Thank you. Nitin, I'll take your second question, and then on EMR, I'll ask Srini to answer, and on attrition, we have Saurabh here. He can take that.
Nitin Padmanabhan: Hello, good evening. Wishing you a very happy New Year. I had a couple of questions. So one is, I think this quarter we lost almost $24 million of revenue in energy manufacturing resources. I just wanted your thoughts on that vertical and how do you see the deal pipeline there? When do you think this can sort of turn around? The second is you alluded to some delays in ramp-ups impacting growth for next quarter. If you could give some color there, I presume this is related to the last deals. By when do you see this sort of beginning to ramp going forward? And third, when are we expecting to have the wage hike cycle? Yeah, those are the three. Thank you.
Speaker #4: I just wanted your thoughts on that vertical, and how do you see the deal pipeline there. When do you think this can sort of turn around?
Speaker #4: The second is you alluded to some delays in ramp-ups impacting growth for next quarter. If you give some if you could give some color there, I presume this is related to the last deals.
Speaker #4: By when do you see this sort of beginning to ramp going forward? And third, when are we expecting to have the wage hike cycle?
Speaker #4: Yeah, those are the three. Thank you.
Aparna Iyer: Nitin, I'll take your second question, and then on EMR, I'll ask Srini to answer, and on attrition, we have Saurabh here. He can take that.
Speaker #1: So, Nitin, I'll take your second question. And then on EMR, I'll ask Srini to answer, and on attrition, we have Saurabh here—he can take that.
Speaker #1: On hike, salary hike, sorry. You know, Nitin, in terms of our large deal conversion, you know, each deal is different. One of the significant deal wins we had in Q4 of the last financial year, Phoenix, is now fully ramped up and its revenues have fully realized, and it's part of our Q3 performance.
Operator: On hike, salary hike, sorry. Nitin, in terms of our large deal conversion, each deal is different. One of the significant deal wins we had in Q4 of the last financial year, Phoenix has now fully ramped up, and its revenue has fully realized, and it's part of our quarterly performance. So that's on track. Some of the other deals, given the nature of the deals that we won, we've earlier also highlighted that these deals will take a few quarters to ramp up. So it's a question of it coming in through the course of the next few quarters, and therefore we have called it out saying that in Q4 we may not be able to realize the full impact, and therefore we're calling it out.
Aparna Iyer: On hike, salary hike, sorry. Nitin, in terms of our large deal conversion, each deal is different. One of the significant deal wins we had in Q4 of the last financial year, Phoenix has now fully ramped up, and its revenue has fully realized, and it's part of our quarterly performance. So that's on track. Some of the other deals, given the nature of the deals that we won, we've earlier also highlighted that these deals will take a few quarters to ramp up. So it's a question of it coming in through the course of the next few quarters, and therefore we have called it out saying that in Q4 we may not be able to realize the full impact, and therefore we're calling it out.
Speaker #1: So that's on track. Some of the other deals, given the nature of the deals that we've won, we've earlier also highlighted that these deals will take a few quarters to ramp up.
Speaker #1: So it's a question of it coming in through the course of the next few quarters, and therefore we've called it out, saying that in Q4 we may not be able to realize the full impact, and therefore we're calling it out.
Speaker #1: The other lever that is playing out is typically for those who come back, but Q4 continues to have lower working days, which is not really—this is in some sense offsetting for those furloughs.
Operator: The other lever that is playing out is typically furloughs do come back, but Q4 continues to have lower working days, which is not really. This is in some sense offsetting for those furloughs, and therefore we've given you the guidance we have. But these deals should continue to convert. Each deal is different. We are confident it will take some time, but it will ramp up. Srini, you want to talk on EMR, and then Saurabh can talk. Sure. Thanks, Aparna. Happy New Year, Nitin. As far as EMR is concerned, our performance in this sector clearly has been impacted based on the macroeconomic uncertainty we have seen, some during tariff-related, and also some disrupted supply chain issues that we faced. However, our pipeline continues to remain strong in this sector, and essentially the significant pipeline is around either vendor consolidation or cost takeout.
Aparna Iyer: The other lever that is playing out is typically furloughs do come back, but Q4 continues to have lower working days, which is not really. This is in some sense offsetting for those furloughs, and therefore we've given you the guidance we have. But these deals should continue to convert. Each deal is different. We are confident it will take some time, but it will ramp up. Srini, you want to talk on EMR, and then Saurabh can talk.
Speaker #1: And therefore, we've given you the guidance we have. But these deals should continue to convert. Each deal is different. We're confident it'll take some time, but it will ramp up.
Speaker #1: Srini, you want to talk on EMR, and then Saurabh can talk.
Speaker #2: Sure. Thanks, Aparna. Happy New Year, Nitin. As far as EMR is concerned, our performance in this sector clearly has been impacted based on the macroeconomic uncertainty we have seen.
Saurabh Govil: Sure. Thanks, Aparna. Happy New Year, Nitin. As far as EMR is concerned, our performance in this sector clearly has been impacted based on the macroeconomic uncertainty we have seen, some during tariff-related, and also some disrupted supply chain issues that we faced. However, our pipeline continues to remain strong in this sector, and essentially the significant pipeline is around either vendor consolidation or cost takeout.
Speaker #2: Some during tariff-related and also some disrupted supply chain issues that we faced. However, our pipeline continues to remain strong in this sector. And essentially, the significant pipeline is around either vendor consolidation or cost takeout.
Speaker #2: And if I were to give a little bit of color to your specific segments, we have VC good momentum in energy in both Americas and Europe.
Operator: And if I were to give you a little bit of color to specific segments, we have really good momentum in energy in both Americas and Europe, and as far as manufacturing is concerned, we are seeing that in Europe. Also, our Capco business, which is doing some, is also seeing some traction on the energy consulting side. So net-net, that's the situation that we have right now with EMR, Nitin. Over to you, Saurabh. Salary hikes, we will take a call in the next few weeks in terms of when should we be doing it. Our intention is to look at it this quarter, but we'll confirm it during the next couple of weeks. Perfect. Perfect. That's helpful. Just one clarification. Do you think EMR should start getting back to growth sometime next year? That's the last question from me. Thank you.
Saurabh Govil: And if I were to give you a little bit of color to specific segments, we have really good momentum in energy in both Americas and Europe, and as far as manufacturing is concerned, we are seeing that in Europe. Also, our Capco business, which is doing some, is also seeing some traction on the energy consulting side. So net-net, that's the situation that we have right now with EMR, Nitin. Over to you, Saurabh.
Speaker #2: And as far as manufacturing is concerned, we are seeing that in Europe. Also, our Capco business, which is doing some, is also seeing some traction on the energy consulting side.
Speaker #2: So, net-net, that's the situation that we have right now with EMR. Nitin, over to you.
Speaker #2: Saurabh. In
Saurabh Govil: Salary hikes, we will take a call in the next few weeks in terms of when should we be doing it. Our intention is to look at it this quarter, but we'll confirm it during the next couple of weeks. Perfect. Perfect. That's helpful. Just one clarification. Do you think EMR should start getting back to growth sometime next year? That's the last question from me. Thank you.
Speaker #5: Salary hikes—we will take a call in the next few weeks in terms of when we should be doing it. Our intention is to look at it this quarter, but we'll confirm it during the next couple of weeks.
Speaker #4: Perfect. Perfect. That's helpful. Just one clarification. Do you think EMR should start getting back to growth sometime next year? That's the last question from my side.
Speaker #4: Thank you.
Speaker #2: So as far as EMR is concerned, Nitin, I'll just repeat that. One is the pipeline. Like I said, specifically, we have good momentum on the pipeline in energy in both Americas and Europe.
Operator: So as far as EMR is concerned, Nitin, I'll just repeat that. One is the pipeline. Like I said, specifically, we have good momentum on the pipeline in energy in both Americas and Europe, and as far as manufacturing is concerned, it's in Europe. I think our focus right now is to convert these deals, and then that should drive the revenue growth for us, and we are just staying focused on winning some of those deals, Nitin. Perfect. That's very helpful. Thank you so much, and all the very best. Thank you. Thank you. Next question is from the line of Vibhor Singhal from Nuvama Equities. Please go ahead. Yeah. Hi. Thanks for taking my question and congrats on a solid performance. So actually, my question was mainly on basically the consumer vertical. You mentioned about the challenges in the EMR vertical. Banking has been doing well for us.
Operator: So as far as EMR is concerned, Nitin, I'll just repeat that. One is the pipeline. Like I said, specifically, we have good momentum on the pipeline in energy in both Americas and Europe, and as far as manufacturing is concerned, it's in Europe. I think our focus right now is to convert these deals, and then that should drive the revenue growth for us, and we are just staying focused on winning some of those deals, Nitin. Perfect. That's very helpful. Thank you so much, and all the very best. Thank you. Thank you. Next question is from the line of Vibhor Singhal from Nuvama Equities. Please go ahead. Yeah. Hi. Thanks for taking my question and congrats on a solid performance. So actually, my question was mainly on basically the consumer vertical. You mentioned about the challenges in the EMR vertical. Banking has been doing well for us.
Speaker #2: And as far as manufacturing is concerned, it's in Europe. I think our focus right now is to convert these deals, and then that should drive the revenue growth for us.
Speaker #2: And we are just staying focused on winning some of those deals.
Speaker #2: Nitin. Perfect.
Speaker #4: Very helpful. Thank you so much, and all the very best.
Speaker #2: Thank
Speaker #2: Thank you. And thank
Speaker #1: Thank you. Next question is from the line of Abhishek Jain.
Speaker #3: Vibhor Singal from Noama Equities. Please go ahead.
Speaker #3: ahead. Yeah, hi.
Speaker #6: Thanks for taking my question, and congrats on a solid performance. So, actually, my question was mainly on the consumer vertical. You mentioned the challenges in the EMR vertical; banking has been doing well for us.
Speaker #6: In the consumer vertical, the growth was kept in this quarter. We continue to decline on the by-and-buy basis. How do you see the outlook in this vertical?
Operator: In the consumer vertical, the growth was tepid in this quarter. We continued to decline on a Y-on-Y basis. How do you see the outlook in this vertical? We know this vertical also has been impacted a lot by the tariff uncertainty that has basically impacted the producers. But in your conversation with the clients in terms of our interactions in the pipeline, do you see it turning the corner in coming quarters, or do you think it will be sometime before some clarity emerges in this vertical? Thanks, Vibhor. If you look at our consumer sector, clearly, if you recollect, I talked about it before as well, that the tariffs had an impact on this, and that has reflected in our numbers.
Operator: In the consumer vertical, the growth was tepid in this quarter. We continued to decline on a Y-on-Y basis. How do you see the outlook in this vertical? We know this vertical also has been impacted a lot by the tariff uncertainty that has basically impacted the producers. But in your conversation with the clients in terms of our interactions in the pipeline, do you see it turning the corner in coming quarters, or do you think it will be sometime before some clarity emerges in this vertical? Thanks, Vibhor. If you look at our consumer sector, clearly, if you recollect, I talked about it before as well, that the tariffs had an impact on this, and that has reflected in our numbers.
Speaker #6: We know this vertical also has been impacted a lot by the tariff uncertainty that has basically impacted the producers. But in your conversations with the clients, in terms of our interactions and the pipeline, do you see it turning the corner in the coming quarters, or do you think it will be some time before some clarity emerges in this vertical?
Speaker #2: Thanks, Vibhar. If you look at our consumer sector, clearly, if you recollect, I talked about it before as well—that the tariffs had an impact on this and that has reflected in our numbers.
Speaker #2: And also, if you recollect, there was a large SAP program which was put on hold last year by our customers. And again, the client is yet to reinitiate.
Operator: And also, if you recollect, there was a large SAP program which was put on hold last year by our customers, and again, the client is yet to reinitiate, and that is one of the things that is impacting our year-on-year performance as well in this particular market sector. However, the overall trend that we see right now is mixed here for us in consumer. Some of the wins we had earlier this year is slowly ramping up, and that should support the growth in this sector. I do not have a, from a Q4 perspective, whatever growth we are seeing; that's baked into our forecast, Vibhor. Got it. Got it. Got it. And similar thing on the basically IT vertical. I know it's not that big a vertical, but I think both tech and health vertical appear to be doing good.
Operator: And also, if you recollect, there was a large SAP program which was put on hold last year by our customers, and again, the client is yet to reinitiate, and that is one of the things that is impacting our year-on-year performance as well in this particular market sector. However, the overall trend that we see right now is mixed here for us in consumer. Some of the wins we had earlier this year is slowly ramping up, and that should support the growth in this sector. I do not have a, from a Q4 perspective, whatever growth we are seeing; that's baked into our forecast, Vibhor. Got it. Got it. Got it. And similar thing on the basically IT vertical. I know it's not that big a vertical, but I think both tech and health vertical appear to be doing good.
Speaker #2: And that is one of the things that is impacting our year-on-year performance as well, in this particular thing, in this particular market sector. However, the overall trend that we see right now is mixed here for us in consumer.
Speaker #2: Some of the wins we had earlier this year are slowly ramping up, and that should support the growth in this sector. I do not have, from a Q4 perspective, whatever growth we are seeing—that's baked into our forecast.
Speaker #2: Vibhar. Got
Speaker #6: It. Got it. Got it. And similar thing on the—basically, I think vertical—I know it's not that big a vertical, but I think both tech and health verticals appear to be doing good.
Speaker #6: Any specific project wrap-up that we saw in this quarter which led to this growth, or do you think it's a growth which we can sustain in the coming quarters as well?
Operator: Any specific project ramp-up that we saw in this quarter which led to this growth, or do you think it's a growth which we can sustain in the coming quarters as well? Sorry, which sector did you refer to, Vibhor? Aparna, Tech and the healthcare verticals. Both of them, separately. In some sense, in healthcare, we've been consistently doing good and looked at both in our year-on-year performance. Seasonally, obviously, we have the open enrollment season that really does improve our health performance in Q3. So that has also added to the performance. In terms of our Tech and Com, we've continued to do well in some of our large technology players, and there is a little bit of the Harman acquisition numbers which has also reflected in the overall sector's performance. And I think communications in general have been better for Europe and APMEA.
Operator: Any specific project ramp-up that we saw in this quarter which led to this growth, or do you think it's a growth which we can sustain in the coming quarters as well? Sorry, which sector did you refer to, Vibhor? Aparna, Tech and the healthcare verticals. Both of them, separately. In some sense, in healthcare, we've been consistently doing good and looked at both in our year-on-year performance. Seasonally, obviously, we have the open enrollment season that really does improve our health performance in Q3. So that has also added to the performance. In terms of our Tech and Com, we've continued to do well in some of our large technology players, and there is a little bit of the Harman acquisition numbers which has also reflected in the overall sector's performance. And I think communications in general have been better for Europe and APMEA.
Speaker #6: Well? Sorry, which sector did you refer to,
Speaker #6: Aparna, tech Vibhor? And the healthcare verticals. Both of them, separately.
Speaker #1: You know, in some sense in healthcare, we've been consistently doing well. And we had a sector, both in our year-on-year performance. Seasonally, obviously, we have the open enrollment season that really does improve our health performance in Q3.
Speaker #1: So that is also added to the performance. In terms of our tech and com, we've continued to do well in some of our large technology players.
Speaker #1: And there is a little bit of the Harmon acquisition numbers that has also reflected in the overall sector's performance. And I think communications in general have done—has been better for Europe and APAC.
Speaker #1: That's the color I can give you.
Operator: That's the color I can give you. Perfect. Perfect. That's really helpful. Aparna, just one last question from my side. You mentioned about the few headwinds in Q4 that you would be facing. And if I look at our guidance, which is 0% to 2% at the constant currency level, and if we were to, let's say, extrapolate the two-month incremental impact of the Harman acquisition, the organic growth will probably fall somewhere between -1.5% to +0.5%. Is that the right understanding? And is the reason for that very much as you mentioned in your opening remarks as well? Vibhor, for some reason, we're not able to hear it clearly. Can you just elaborate on your question? I'm so sorry. Just give me a second. Very sorry. Yeah. Hi. Can you hear me? Yes. I'm sorry. His line is disconnected. We'll move on to the next question.
Operator: That's the color I can give you. Perfect. Perfect. That's really helpful. Aparna, just one last question from my side. You mentioned about the few headwinds in Q4 that you would be facing. And if I look at our guidance, which is 0% to 2% at the constant currency level, and if we were to, let's say, extrapolate the two-month incremental impact of the Harman acquisition, the organic growth will probably fall somewhere between -1.5% to +0.5%. Is that the right understanding? And is the reason for that very much as you mentioned in your opening remarks as well? Vibhor, for some reason, we're not able to hear it clearly. Can you just elaborate on your question? I'm so sorry. Just give me a second. Very sorry. Yeah. Hi. Can you hear me? Yes. I'm sorry. His line is disconnected. We'll move on to the next question.
Speaker #6: Perfect. Perfect. That's really helpful. Aparna, just one last question from my side. You mentioned about the few headwinds in Q4 that you would be facing.
Speaker #6: And if I look at our guidance, which is 0 to 2% at the console level, and if we were to, let's say, extrapolate the two-month incremental impact of the Harman acquisition, the organic growth will probably fall somewhere between minus 1.5% to plus 0.5%.
Speaker #6: Is that the right understanding? And is the reason for that very much as you mentioned in your opening remarks, as
Speaker #6: Well? You know, Vibhor, for some reason, we're
Speaker #1: Not able to hear it clearly. Can you just load on your...
Speaker #1: question? I'm so sorry.
Speaker #6: Just give me a second. Very sorry. Yeah, hi. Can you hear me?
Speaker #3: I'm sorry. His line is, yes, disconnected. We'll move on to the next question. Before we do that, ladies and gentlemen, to ask a question, please press star and one on your phone.
Operator: Before we do that, ladies and gentlemen, to ask a question, please press star and one on your phone. Next question is from the line of Ravi Menon from Macquarie. Please go ahead. Hi. Thanks for the opportunity. And congrats on a really strong margin performance this quarter. Now that you've come to sequential growth, you know, as seasonally we caught a surprise that organically we seem to be hinting at a slight decline, possibly at the lower end of our guidance next quarter. And Capco should also be coming out of the furloughs that it's had this quarter, right? So could you talk a bit about that? And beyond that, do you think that sequential growth is possible looking at the pipeline and the slight improvement possibly if we have on the demand environment? So I will ask Srini to talk through the demand environment.
Operator: Before we do that, ladies and gentlemen, to ask a question, please press star and one on your phone. Next question is from the line of Ravi Menon from Macquarie. Please go ahead. Hi. Thanks for the opportunity. And congrats on a really strong margin performance this quarter. Now that you've come to sequential growth, you know, as seasonally we caught a surprise that organically we seem to be hinting at a slight decline, possibly at the lower end of our guidance next quarter. And Capco should also be coming out of the furloughs that it's had this quarter, right? So could you talk a bit about that? And beyond that, do you think that sequential growth is possible looking at the pipeline and the slight improvement possibly if we have on the demand environment? So I will ask Srini to talk through the demand environment.
Speaker #3: Next question is from the line of Ravi Menon from Macquarie.
Speaker #4: Hi. Thanks for the opportunity, and congrats on a really strong margin performance this quarter. Now that you've come to sequential growth, you're in a seasonally weak quarter.
Speaker #4: My surprise that, organically, we seem to be hinting at a slight decline, possibly at the lower end of our guidance next quarter. And Capco should also be coming out of the furloughs that it has had this quarter, right?
Speaker #4: So, could you talk a bit about that? And beyond that, do you think that sequential growth is possible, looking at the pipeline and the slight improvement, possibly, if we have on the demand?
Speaker #4: Environment? So, I will ask Srini.
Speaker #1: To talk through the demand environment: you know we guide based on the visibility that we have at the start of the quarter. I've shared with you that some of the furloughs that typically do come back have been partially offset by the lower working days that we are also seeing this year.
Operator: We guide based on the visibility that we have at the start of the quarter. I've shared with you that some of the furloughs that typically do come back have been partially offset by the lower working days that we are also seeing this year. And to that extent, we are seeing some softness continue, right? But that said, our endeavor would be to obviously execute the quarter better through the next 90 days, right? You want to talk? Thanks, Aparna. So Navin, if we look at it, there is no significant change in the demand environment, specifically the discretionary spend as the uncertainty continues. Second, January is the time when many of our customers will finalize their budgeting process. We'll have a much better understanding and view of where they are going to spend.
Operator: We guide based on the visibility that we have at the start of the quarter. I've shared with you that some of the furloughs that typically do come back have been partially offset by the lower working days that we are also seeing this year. And to that extent, we are seeing some softness continue, right? But that said, our endeavor would be to obviously execute the quarter better through the next 90 days, right? You want to talk? Thanks, Aparna. So Navin, if we look at it, there is no significant change in the demand environment, specifically the discretionary spend as the uncertainty continues. Second, January is the time when many of our customers will finalize their budgeting process. We'll have a much better understanding and view of where they are going to spend.
Speaker #1: And to that extent, we are seeing some softness continue, right? But that said, our endeavor would be to obviously execute the quarter better through these next 90 days.
Speaker #1: Right?
Speaker #1: You want to talk? Thanks, Aparna.
Speaker #2: So, Navin, if we look at it, there is no significant change in the demand environment, specifically the discretionary spend, as the uncertainty continues. Second, January is the time when many of our customers will finalize their budgeting process.
Speaker #2: We'll have a much better understanding and view of where they are going to spend. But having said that, if I look at the current pipeline that we have, a significant piece of this pipeline is around cost optimization and vendor consolidation, which are the key levers for our clients.
Operator: But having said that, if I look at the current pipeline that we have, a significant piece of this pipeline is around cost optimization and vendor consolidation, which are the key levers for our clients. And they are using this as a lever for savings, and they want to reinvest these savings into AI capabilities and also some of the advanced transformation projects that they want to do. For us, we believe this is an opportunity for us to capitalize on this, and we'll make strategic bets in each of these sectors and markets, and continue to invest in our clients to do this. From a full year visibility, like Aparna said, there is uncertainty in the market, and customers continue to remain in wait and watch mode. At this stage, our guidance represents best visibility we have. And if there are any further updates, we will definitely share, Navin.
Operator: But having said that, if I look at the current pipeline that we have, a significant piece of this pipeline is around cost optimization and vendor consolidation, which are the key levers for our clients. And they are using this as a lever for savings, and they want to reinvest these savings into AI capabilities and also some of the advanced transformation projects that they want to do. For us, we believe this is an opportunity for us to capitalize on this, and we'll make strategic bets in each of these sectors and markets, and continue to invest in our clients to do this. From a full year visibility, like Aparna said, there is uncertainty in the market, and customers continue to remain in wait and watch mode. At this stage, our guidance represents best visibility we have. And if there are any further updates, we will definitely share, Navin.
Speaker #2: And they are using this as a lever for savings, and they want to reinvest these savings into AI capabilities and also some of the advanced transformation projects that they want to do.
Speaker #2: At Wipro, we believe this is an opportunity for us to capitalize on this. And we'll make strategic bets in each of these sectors and markets, and continue to invest in our clients to do this.
Speaker #2: From a full-year visibility, like Aparna said, there is uncertainty in the market and customers continue to remain in wait-and-watch mode. At this stage, our guidance represents the best visibility we have.
Speaker #2: And if there are any further updates, we will definitely share, Navin.
Speaker #4: Thanks, Srini. And Srini, when you talked about vendor consolidation and cost takeout, and clients actually using those savings for transformation, are they actually giving both to the same vendor, or do they prefer to split that out?
Operator: Thanks for that, Srini. And Srini, when you talked about vendor consolidation and cost takeout and clients actually using those savings for transformation, are they actually giving both to the same vendor, or do they prefer to split that out? What's that you're seeing, at least in the wins that you have? So Navin, it's mixed. There are certain clients who are doing that and continuing with their current partners, and there are certain clients who are changing, and there are certain clients who are increasing the scope and using multiple partners as well. So it clearly varies from client to client, Navin. All right. Thanks. And one last question on the Harman DTS. Which segments do you think this really improves your possibility of win rates? So Navin, if I understand the question, how the Harman DTS acquisition will help us, right? Correct. Yeah.
Operator: Thanks for that, Srini. And Srini, when you talked about vendor consolidation and cost takeout and clients actually using those savings for transformation, are they actually giving both to the same vendor, or do they prefer to split that out? What's that you're seeing, at least in the wins that you have? So Navin, it's mixed. There are certain clients who are doing that and continuing with their current partners, and there are certain clients who are changing, and there are certain clients who are increasing the scope and using multiple partners as well. So it clearly varies from client to client, Navin. All right. Thanks. And one last question on the Harman DTS. Which segments do you think this really improves your possibility of win rates? So Navin, if I understand the question, how the Harman DTS acquisition will help us, right? Correct. Yeah.
Speaker #4: What's that you're seeing, at least in the winds that you have?
Speaker #2: So, Navin, it's mixed. There are certain clients who are doing that and continuing with their current partners, and there are certain clients who are changing.
Speaker #2: And there are certain clients who are increasing the scope and using multiple partners as well. So it clearly varies from client to client.
Speaker #2: client, Navin. All right.
Speaker #4: Thanks, Srini. And one last question on the Harmon DTS. Which segments do you think this really improves your possibility of win rates?
Speaker #2: So Navin, if I understand the question, how the Harman DTS acquisition will help us,
Speaker #2: right? Correct.
Speaker #4: Yeah. Which sectors do you expect the win rates to improve?
Operator: Which sectors do you expect the win rates to improve? So clearly, Harman brings in both design-to-manufacturing capabilities and AI-powered product innovation. In that context, clearly, the sweet spot for a combined unit, especially the engineering global business line that we have, is the Tech and Com sector. That's, I think, primarily the one where we see a significant opportunity. And the other three sectors I would pick are Health, Consumer, and EMR, Navin. Thanks so much. That's all. Thank you. We'll take our next question from the line of Sandeep Shah from Equirus Securities. Please go ahead. Yeah. Thanks. Thanks for the opportunity.
Operator: Which sectors do you expect the win rates to improve? So clearly, Harman brings in both design-to-manufacturing capabilities and AI-powered product innovation. In that context, clearly, the sweet spot for a combined unit, especially the engineering global business line that we have, is the Tech and Com sector. That's, I think, primarily the one where we see a significant opportunity. And the other three sectors I would pick are Health, Consumer, and EMR, Navin. Thanks so much. That's all. Thank you. We'll take our next question from the line of Sandeep Shah from Equirus Securities. Please go ahead. Yeah. Thanks. Thanks for the opportunity.
Speaker #2: Yeah. So, clearly, Harman brings in both design-to-manufacturing capabilities and AI-powered product innovation. In that context, clearly, the sweet spot for a combined unit—especially the engineering global business line that we have—is the tech and communications sector.
Speaker #2: That's, I think, primarily the one where we see a significant opportunity. And the other three sectors I would pick are Health, Consumer, and EMR, Navin.
Speaker #4: Okay. Thanks so
Speaker #4: much.
Speaker #3: Thank
Speaker #3: We'll take our next question from the line of Sandeep Shah from Equira Securities. Please go ahead.
Speaker #1: Yeah, thanks for the opportunity. Just the first question: because of the delay in ramp-up of deal wins in the last two, three quarters, is it fair to assume if those ramp up in the first quarter next year, then the seasonal softness, which generally comes in the first quarter, may not be true next year?
Operator: Just the first question is, because of delay in ramp-up of deal wins of the last two, three quarters, is it fair to assume if those ramp up in the first quarter next year, then the seasonal softness which generally comes in the first quarter may not be true next year? So Sandeep, yes, in some sense, that will be the objective that we ramp up enough so that we can offset for some of the weakness that could arise. That said, we don't guide for Q1, but we would like to clarify that it's just delayed, and some of those do take time to ramp up. And confident that it will ramp up, and we will keep you posted. Okay. Okay. Just Aparna, I wanted to understand the guidance on the margins, which you said narrow band. Narrow band compared to Q3 margins or earlier range?
Operator: Just the first question is, because of delay in ramp-up of deal wins of the last two, three quarters, is it fair to assume if those ramp up in the first quarter next year, then the seasonal softness which generally comes in the first quarter may not be true next year? So Sandeep, yes, in some sense, that will be the objective that we ramp up enough so that we can offset for some of the weakness that could arise. That said, we don't guide for Q1, but we would like to clarify that it's just delayed, and some of those do take time to ramp up. And confident that it will ramp up, and we will keep you posted. Okay. Okay. Just Aparna, I wanted to understand the guidance on the margins, which you said narrow band. Narrow band compared to Q3 margins or earlier range?
Speaker #1: So Sandeep, yes. In some sense, that will be the objective—that we ramp up enough so that we can offset for some of the weakness that could arise.
Speaker #1: That said, we don't guide for Q1. But we would like to clarify that it's just delayed, and some of this does take time to ramp up.
Speaker #1: And confident that it will ramp up, and we will keep you posted.
Speaker #3: Okay, okay. Just Aparna, I wanted to understand the guidance on the margins, which you said is narrow-band compared to Q3 margins or earlier range?
Speaker #1: So, you know again, we don't guide for margins. You've seen our performance over the last eight quarters—we've consistently improved, right? I think all credit to the team.
Operator: So again, no, we don't guide for margins. You've seen our performance over the last eight quarters. We've consistently improved, right? I think all credit to the team. We have been fairly resilient on margins, and we will continue our endeavor to keep it. But that said, we will have to invest for growth, and that's the number one priority, right? We've acquired Harman DTS, and that will mean an incremental dilution to our margins that we will have to absorb. Two, we continue to chase and win large deals, and they come with a different margin profile. And these are very important investments we'll have to make. And there will also be decisions that will have to be made on wage increases that Saurabh spoke of. A lot of moving parts.
Operator: So again, no, we don't guide for margins. You've seen our performance over the last eight quarters. We've consistently improved, right? I think all credit to the team. We have been fairly resilient on margins, and we will continue our endeavor to keep it. But that said, we will have to invest for growth, and that's the number one priority, right? We've acquired Harman DTS, and that will mean an incremental dilution to our margins that we will have to absorb. Two, we continue to chase and win large deals, and they come with a different margin profile. And these are very important investments we'll have to make. And there will also be decisions that will have to be made on wage increases that Saurabh spoke of. A lot of moving parts.
Speaker #1: We have been fairly resilient on margin, and we will continue our endeavor to keep it. But that said, we will have to invest for growth.
Speaker #1: And that's the number one priority, right? We've acquired DTS Harmon, and that will mean an incremental dilution to our margins that we will have to absorb.
Speaker #1: Two, we continue to chase and win last deals. And they come with a different margin profile. And these are very important investments we'll have to make.
Speaker #1: And there will also be decisions that will have to be made on wage increases—that sort of spoke off. A lot of moving parts; our endeavor is going to be to make sure that we keep it in that band of 17 to 17.5 percent.
Operator: Our endeavor is going to be to make sure that we keep it in that band of 17% to 17.5%. If you recall, we had said that while we stated that band with the acquisition, we will see pressure to that. Right now, we are continuing to hold that band, which itself is a positive. But like I said, we will have to take it quarter to quarter. There will be some quarters where we will have to invest in our people, in our deals, in our clients, and for growth. So we will make those trade-offs. Yeah. This last couple of questions, the deal TCV in this quarter, both on large deal and total, has been slightly softer versus very strong momentum in the earlier three quarters.
Operator: Our endeavor is going to be to make sure that we keep it in that band of 17% to 17.5%. If you recall, we had said that while we stated that band with the acquisition, we will see pressure to that. Right now, we are continuing to hold that band, which itself is a positive. But like I said, we will have to take it quarter to quarter. There will be some quarters where we will have to invest in our people, in our deals, in our clients, and for growth. So we will make those trade-offs. Yeah. This last couple of questions, the deal TCV in this quarter, both on large deal and total, has been slightly softer versus very strong momentum in the earlier three quarters.
Speaker #1: If you recall, we had said that, while we stated that band with the acquisition, we will see pressure to that. Right now, we are continuing to hold that band, which itself is a positive.
Speaker #1: But, like I said, we will have to take it quarter to quarter. There will be some quarters where we will have to invest in our people, in our deals, in our clients.
Speaker #1: And for growth, so we will make those.
Speaker #1: trade-offs. Yeah.
Speaker #3: These last couple of questions—the deal TCV in this quarter, both on large deals and total—has been slightly softer versus very strong momentum in the earlier three quarters.
Speaker #3: So, is there any reason—where is it, is the client decision-making being slowed down, or is it the intense competitive pressure which has led to some decline in the win ratio?
Operator: So, any reason? Is it the client decision-making being slowed down, or it's the intense competitive pressure which has led to some decline in the win ratio? And the last question. Yeah. Typically, like I said, some of these deals, they tend to clump, right? We are contesting a lot of large deals. They are in the cycle. We are hopeful of closing them. You will continue to see the momentum on large deal wins at a billion dollars, or maybe we are just shy of $1 billion by $100 million. That's been the normal trajectory. Obviously, in the first half, we had a few mega deal wins, four to be specific. We hope to win more, right? So, I wouldn't read into it in terms of slower decision-making cycle or competitive pressure. I would just say that they tend to clump up.
Operator: So, any reason? Is it the client decision-making being slowed down, or it's the intense competitive pressure which has led to some decline in the win ratio? And the last question. Yeah. Typically, like I said, some of these deals, they tend to clump, right? We are contesting a lot of large deals. They are in the cycle. We are hopeful of closing them. You will continue to see the momentum on large deal wins at a billion dollars, or maybe we are just shy of $1 billion by $100 million. That's been the normal trajectory. Obviously, in the first half, we had a few mega deal wins, four to be specific. We hope to win more, right? So, I wouldn't read into it in terms of slower decision-making cycle or competitive pressure. I would just say that they tend to clump up.
Speaker #3: And the last question
Speaker #1: Yeah. Typically, like I said, some of these deals, they tend to club, right? We are contesting a lot of large deals. They are in the cycle.
Speaker #1: We are hopeful of closing them. You will continue to see the momentum on large deal wins. At a billion dollars, or maybe we are just shy of $1 billion by $100 million.
Speaker #1: That's been the normal trajectory. Obviously, in the first half, we had a few mega deal wins. So, to be specific, we hope to win more.
Speaker #1: Right? So I wouldn't read into it in terms of a slower decision-making cycle or competitive pressure. I would just say that they tend to lump up.
Speaker #1: We have a lot of good deals, and we will see the momentum pick.
Operator: We have a lot of good deals, and we will see the momentum pick up. Okay. And just the last question, Aparna, with the war chest of $6.1 billion, though we are distributing dividend, but is it fair to assume that buyback continues to remain one of the options in the mind to give this excess cash back to the shareholders? We have said that buyback will continue to be a means by which we will return cash to our shareholders. It's certainly an option on the table, and we will consider it at an appropriate time. Okay. Thanks, and all the best. Thank you. Thank you. Next question is from the line of Kumar Rakesh from BNP Paribas. Please go ahead. Hi. Good evening, and thank you for taking my question. I had just one question.
Operator: We have a lot of good deals, and we will see the momentum pick up. Okay. And just the last question, Aparna, with the war chest of $6.1 billion, though we are distributing dividend, but is it fair to assume that buyback continues to remain one of the options in the mind to give this excess cash back to the shareholders? We have said that buyback will continue to be a means by which we will return cash to our shareholders. It's certainly an option on the table, and we will consider it at an appropriate time. Okay. Thanks, and all the best. Thank you. Thank you. Next question is from the line of Kumar Rakesh from BNP Paribas. Please go ahead. Hi. Good evening, and thank you for taking my question. I had just one question.
Speaker #1: up.
Speaker #3: Okay. And just
Speaker #3: The last question, Aparna: with the war chest of $6.1 billion, though we are distributing dividends, is it fair to assume that buyback continues to remain one of the options in mind to give this excess cash back to the shareholders?
Speaker #1: We have said that buyback will continue to be a means by which we will return cash to our shareholders. It's certainly an option on the table.
Speaker #1: And we will consider it at an appropriate time.
Speaker #1: time. Okay.
Speaker #3: Thanks and all the
Speaker #3: Best. Thank you. Next question is from the line of Kumar Rakesh from BNP Paribas. Please go ahead.
Speaker #1: Thank you.
Speaker #3: ahead. Hi.
Speaker #4: Good evening, and thank you for taking my question. I had just one question. Do you think, given the kind of mix which you have—both of vertical and the capability at Wipro—you would be able to get back in line with the industry average revenue growth?
Operator: Do you think, given the kind of mix which you have, both of verticals and the capability at Equirus, you would be able to get back in line with the industry average revenue growth, or would it make sense to just slow down your margin, get to mid-teens sort of a margin, be able to better compete with some of your peers, maybe with your peers as well, or maybe acquire some of the companies to reset the mix? What's your thought on that? So Kumar. Kumar, clearly, first, if you look at our inorganic strategy, it's very clearly aligned to the strategic priorities we called out. We constantly look for sectors and the markets combination in terms of where we need to invest, where we need to acquire new capabilities.
Operator: Do you think, given the kind of mix which you have, both of verticals and the capability at Equirus, you would be able to get back in line with the industry average revenue growth, or would it make sense to just slow down your margin, get to mid-teens sort of a margin, be able to better compete with some of your peers, maybe with your peers as well, or maybe acquire some of the companies to reset the mix? What's your thought on that? So Kumar. Kumar, clearly, first, if you look at our inorganic strategy, it's very clearly aligned to the strategic priorities we called out. We constantly look for sectors and the markets combination in terms of where we need to invest, where we need to acquire new capabilities.
Speaker #4: Or would it make sense to just slow down your margin, get to mid-teens—sort of a margin—be able to better compete with some of your peers, maybe with top peers as well?
Speaker #4: Or maybe acquire some of the companies to reset the mix? What's your thought on that?
Speaker #5: So
Speaker #5: So Kumar, Kumar,
Speaker #2: Clearly, first, if you look at our inorganic strategy, it's very clearly aligned to the strategic priorities we called out. We constantly look for sectors in the markets, combinations in terms of where we need to invest, where we need to acquire new capabilities.
Speaker #2: And if you look at specifically Harmon DTS, clearly, it's giving us a combination of both what I would call capabilities and also a few new markets that they're already in.
Operator: If you look at specifically Harman DTS, clearly, it's giving us a combination of both what I would call as capabilities and also a few new markets that they're already in. So we continue to look at opportunities for us, Kumar, as we continue to move forward. Our strategy is both growing our organic and inorganic and continue to invest in our inorganic. And you are right, we do have cash, and as far as that is concerned, it's an opportunity for us to look at the market, scan the market, and do the right investment that makes it a win-win for us. Got it. Thanks a lot for that. Thank you. Next question is from the line of Rishi Jhunjhunwala from IIFL. Please go ahead. Yeah. Thanks for the opportunity.
Operator: If you look at specifically Harman DTS, clearly, it's giving us a combination of both what I would call as capabilities and also a few new markets that they're already in. So we continue to look at opportunities for us, Kumar, as we continue to move forward. Our strategy is both growing our organic and inorganic and continue to invest in our inorganic. And you are right, we do have cash, and as far as that is concerned, it's an opportunity for us to look at the market, scan the market, and do the right investment that makes it a win-win for us. Got it. Thanks a lot for that. Thank you. Next question is from the line of Rishi Jhunjhunwala from IIFL. Please go ahead. Yeah. Thanks for the opportunity.
Speaker #2: So, we continue to look at opportunities for us, Kumar, as we move forward. Our strategy is both growing our organic and inorganic, and we continue to invest in our inorganics.
Speaker #2: And you are right. We do have cash. And as far as that is concerned, it's an opportunity for us to look at the markets, scan the market, and do the right investment that makes it a win-win for
Speaker #2: us. Got it.
Speaker #4: Thanks a lot for
Speaker #4: that.
Speaker #3: Thank
Speaker #3: You. Next question is from the line of Rishi Junjunwala from IIFL. Please go ahead.
Speaker #3: ahead. Yeah.
Speaker #4: Thanks for the opportunity. Just wanted to understand, X of Harmon—doesn't look like there would be much of a sequential growth in Q4. And Q1, as we were discussing earlier in the call, historically has had some weak seasonality.
Operator: Just wanted to understand, DTS of Harman doesn't look like there would be much of a sequential growth in Q4 and Q1, as we were discussing earlier in the call. Historically, it has had some weak seasonality. I noticed a pretty sharp increase in our overall headcount in this quarter. So just wanted to understand, given the outlook for the next couple of quarters, what is driving this and how do we read that? The headcount for this quarter is primarily driven from two things. One is the DTS acquisition. Second is one of the large deals in Phoenix we had done. There was rebadging of people, so I think when we ramped up the deal. So that's been the reason for seeing the ramp-up in this quarter. Otherwise, from a hiring standpoint and supply side, I don't see a challenge.
Operator: Just wanted to understand, DTS of Harman doesn't look like there would be much of a sequential growth in Q4 and Q1, as we were discussing earlier in the call. Historically, it has had some weak seasonality. I noticed a pretty sharp increase in our overall headcount in this quarter. So just wanted to understand, given the outlook for the next couple of quarters, what is driving this and how do we read that? The headcount for this quarter is primarily driven from two things. One is the DTS acquisition. Second is one of the large deals in Phoenix we had done. There was rebadging of people, so I think when we ramped up the deal. So that's been the reason for seeing the ramp-up in this quarter. Otherwise, from a hiring standpoint and supply side, I don't see a challenge.
Speaker #4: I noticed a pretty sharp increase in our overall headcount in this quarter, so just wanted to understand, given the outlook for the next couple of quarters, what is driving this?
Speaker #4: And how do we read that?
Speaker #2: The headcount for this quarter is primarily driven by two things. One is the DTS acquisition. And second is one of the large deals in Phoenix we had done.
Speaker #2: They were rebadging of people. So, I think when we ramped up the deal, that's been the reason for seeing the ramp-up in this quarter.
Speaker #2: Otherwise, from a hiring standpoint and supply side, I don't see a challenge. Attrition has been at 2%—low for the quarter. Trending the same in the next quarter.
Operator: Attrition has been at 2% low for the quarter. Trending the same in the next quarter. We are going to go to the campuses again. We had taken a bit of a hit in this quarter, next quarter. So from a supply side, utilization is looking up in light of the furloughs, the amount of the leave which people have taken. So we are fairly confident in the headcount, supply side to manage the demand. Understood, sir. The second question is just wanted to understand this restructuring cost that we have booked in our financials. Is it in the same nature as what we did in Q1? And if not, if you can give some color around that. The restructuring basically has pivoted on obsolete skill sets and primarily in two areas. One is in Europe, where we have tough labor laws, and second is in Capco.
Operator: Attrition has been at 2% low for the quarter. Trending the same in the next quarter. We are going to go to the campuses again. We had taken a bit of a hit in this quarter, next quarter. So from a supply side, utilization is looking up in light of the furloughs, the amount of the leave which people have taken. So we are fairly confident in the headcount, supply side to manage the demand. Understood, sir. The second question is just wanted to understand this restructuring cost that we have booked in our financials. Is it in the same nature as what we did in Q1? And if not, if you can give some color around that. The restructuring basically has pivoted on obsolete skill sets and primarily in two areas. One is in Europe, where we have tough labor laws, and second is in Capco.
Speaker #2: We are going to go to the campuses again. We had taken a bit of a hiatus in this quarter. Next quarter, so from a supply side, utilization is looking up.
Speaker #2: Net of the furloughs, which we are net of the leave which people have taken, so we are fairly confident in the headcount supply side to manage the
Speaker #2: demand. Understood, sir.
Speaker #4: The second question is, I just wanted to understand this restructuring cost that we have booked in our financials. Is it of the same nature as what we did in Q1?
Speaker #4: And if not, if you can give some color around that.
Speaker #4: that. The
Speaker #2: Restructuring, basically, is pivoted on obsolete skill sets and primarily in two areas. One is in Europe, where we have tough labor laws, and second is in CapCo.
Speaker #2: These are the two big areas where we did that, similar to what we had done in Q2.
Speaker #2: These are the two big areas where we did that, similar to what we had done in Q1. Understood.
Operator: Those are the two big areas where we did that, similar to what we had done in Q1. Understood. And just last thing, there was a bookkeeping question. There is a spike in D&A in this quarter. Any particular reason, and is that a normalized level going forward as well? Thank you. We have taken a provision for bad and doubtful charge, and I think that's the line item that will show an increase. That's been the usual course of business. You should see that go off starting next quarter. Aparna, I was asking about depreciation and amortization. Okay. And typically, we do assess the intangibles every year. And based on the expected forecast, etc., sometimes we tend to accelerate such amortization. In this quarter, we did accelerate some amortization towards one of the earlier acquisitions, and that's reflected. And that should also normalize.
Operator: Those are the two big areas where we did that, similar to what we had done in Q1. Understood. And just last thing, there was a bookkeeping question. There is a spike in D&A in this quarter. Any particular reason, and is that a normalized level going forward as well? Thank you. We have taken a provision for bad and doubtful charge, and I think that's the line item that will show an increase. That's been the usual course of business. You should see that go off starting next quarter. Aparna, I was asking about depreciation and amortization. Okay. And typically, we do assess the intangibles every year. And based on the expected forecast, etc., sometimes we tend to accelerate such amortization. In this quarter, we did accelerate some amortization towards one of the earlier acquisitions, and that's reflected. And that should also normalize.
Speaker #4: And just one last thing, there was a bookkeeping question. There is a spike in DNA in this quarter. Any particular reason? And is that a normalized level going forward as well?
Speaker #4: Thank
Speaker #4: you. We have
Speaker #1: Taken a provision for that in the full day charge. And I think that's the line item that will show an increase. But that's been the usual course of business.
Speaker #1: You should see that go off starting next.
Speaker #1: quarter. Aparna, I was asking
Speaker #4: about depreciation and amortization.
Speaker #1: Okay. And typically, we do assess the intangibles every year. And if, based on the expected forecast, etc., sometimes we tend to accelerate such amortization.
Speaker #1: In this quarter, we did accelerate some amortization towards one of the earlier acquisitions, and that's reflected. And that should also normalize. However, we will have an increased amortization charge coming in for the DTS Harmon.
Operator: However, we will have an increased amortization charge coming in for the Harman DTS. So yeah. So you should wait for the next quarter to get the more normalized then. Sure. Sure. Got it. Thank you so much. Thank you. Thank you. Next question is from the line of Kawaljeet Saluja from Kotak Securities. Please go ahead. Yeah. Hi. Kawaljeet, can you use your handset with me, please? Your audio is not very clear. Yeah. Is it better now? Yes. Please go ahead. Yeah. Hi. Hi, Aparna. Just a couple of questions for you. First is that at $6.5 billion, it seems that you have plenty of excess cash. So how do you intend to flush this excess cash out? Would it be through dividends, or is buyback on the cards? If buyback is on the cards, then what are the considerations set required to move towards that path? Yeah.
Operator: However, we will have an increased amortization charge coming in for the Harman DTS. So yeah. So you should wait for the next quarter to get the more normalized then. Sure. Sure. Got it. Thank you so much. Thank you. Thank you. Next question is from the line of Kawaljeet Saluja from Kotak Securities. Please go ahead. Yeah. Hi. Kawaljeet, can you use your handset with me, please? Your audio is not very clear. Yeah. Is it better now? Yes. Please go ahead. Yeah. Hi. Hi, Aparna. Just a couple of questions for you. First is that at $6.5 billion, it seems that you have plenty of excess cash. So how do you intend to flush this excess cash out? Would it be through dividends, or is buyback on the cards? If buyback is on the cards, then what are the considerations set required to move towards that path? Yeah.
Speaker #1: So yeah, so you should wait for the next quarter to get that more normalized.
Speaker #1: then. Sure, sure.
Speaker #4: Got it. Thank you so
Speaker #4: much. Thank you.
Speaker #2: Thanks. Thank you.
Speaker #3: Next question is from the line of Kawaljeet Saluja from Kotak Securities. Please go ahead.
Speaker #2: Yeah. Hi.
Speaker #3: Kawaljeet, can you raise your hand? Sit mode, please. Your audio is not very...
Speaker #3: clear. Yes. Yeah.
Speaker #4: Is it better now? Yeah.
Speaker #3: Please go ahead.
Speaker #4: Hi. Hi, Aparna. Just a couple of questions for you. First is that at $6.5 billion, it seems that you have plenty of excess cash.
Speaker #4: So, how do you intend to flush this excess cash out? Would it be through dividends? Or is buyback on the cards? And if buyback is on the cards, then what are the considerations set or required to move towards that path here?
Speaker #4: That's the first question.
Operator: That's the first question. Okay. You're right. We did note that we've been having excess cash, and as a result of that, last year, we had increased our capital allocation, and we had said that we would start increasing our dividend payouts. We did that. We paid out INR 6 in the last financial year. This year, we've almost paid INR 11 per share, which is about $1.3 billion, which should nearly account for if I had to just analyze our YTD EPS; this is about 88% or 89% of that. So at least what the increased dividend is doing is we're not adding to the excess cash and leaving enough for a war chest for whatever acquisitions and organic investments we need to make. Is buyback an option to still consider in terms of returning excess cash to shareholders? Indeed, it is. And what are the considerations for that?
Operator: That's the first question. Okay. You're right. We did note that we've been having excess cash, and as a result of that, last year, we had increased our capital allocation, and we had said that we would start increasing our dividend payouts. We did that. We paid out INR 6 in the last financial year. This year, we've almost paid INR 11 per share, which is about $1.3 billion, which should nearly account for if I had to just analyze our YTD EPS; this is about 88% or 89% of that. So at least what the increased dividend is doing is we're not adding to the excess cash and leaving enough for a war chest for whatever acquisitions and organic investments we need to make. Is buyback an option to still consider in terms of returning excess cash to shareholders? Indeed, it is. And what are the considerations for that?
Speaker #1: Okay. You're right. We did note that we've been having excess cash. And as a result of that, last year, we increased our capital allocation, and we said that we would start increasing our dividend payouts.
Speaker #1: We did that. We paid out Rs. 6 in the last financial year. This year, we've almost paid Rs. 11 per share, which is about $1.3 billion.
Speaker #1: We should nearly account for, like, if I had to just analyze our YTD EPS, this is about 88, 89 percent of that. So at least what the increased dividend is doing is we're not adding to the excess cash.
Speaker #1: And leaving enough for a board chair for whatever acquisitions and organic investments we need to make. Buyback is an option to still consider in terms of returning excess cash to shareholders.
Speaker #1: Indeed, it is. And what are the considerations for that? We will have a discussion with the board on that. And we will come back. Typically, considerations include whether we have enough net cash available in order to pursue the investments we need.
Operator: We will have a discussion with the board on that, and we will come back. Typically, considerations include whether we have enough net cash available in order to pursue the investments we need. We will keep the market posted, Kawaljeet. But other statutory considerations are quite in place for buyback. Sorry. Can you just repeat that last part again? I missed it. Yeah. Oh, I said there are some statutory considerations that you can't do a buyback within 12 months. You can't do it if there is a merger pending for NCLT, etc. None of that is. I mean, all of that is conducive, Kawaljeet. Okay. So let's say if you had to theoretically decide to do a buyback today, you can do that. Whereas in the past, there was an NCLT process, a merger, which would have acted as an impediment. There is no such impediment.
Operator: We will have a discussion with the board on that, and we will come back. Typically, considerations include whether we have enough net cash available in order to pursue the investments we need. We will keep the market posted, Kawaljeet. But other statutory considerations are quite in place for buyback. Sorry. Can you just repeat that last part again? I missed it. Yeah. Oh, I said there are some statutory considerations that you can't do a buyback within 12 months. You can't do it if there is a merger pending for NCLT, etc. None of that is. I mean, all of that is conducive, Kawaljeet. Okay. So let's say if you had to theoretically decide to do a buyback today, you can do that. Whereas in the past, there was an NCLT process, a merger, which would have acted as an impediment. There is no such impediment.
Speaker #1: And we will keep the market posted. But other statutory considerations are quite in place for—
Speaker #1: buyback.
Speaker #4: That's
Speaker #4: Right. Just—can you repeat that last part again? I missed it. Yeah.
Speaker #1: Oh, I said there are some statutory considerations—that you can't do a buyback within 12 months. You can't do it if there is a merger pending for NCLT, etc.
Speaker #1: None of that is—I mean, all of that is covered, conducive covered.
Speaker #4: Okay. So, let's say if you had to theoretically decide to do a buyback today, you can do that. Whereas in the past, there was an NCLT process, a merger, which would have acted as an impediment.
Speaker #4: There is no such impediment. I mean, you can do that as and when you feel it's the right time. Yeah. Is that the way to look at it?
Operator: I mean, you can do that as and when you feel it's the right time. Yeah. Is that the way to look at it? Yes. Absolutely. Absolutely. Noted. The second question is for you and Srini. Let's say if those two mega deals ramp up were not delayed, then what would the guidance have been for the March quarter? Any way to detail it out either quantitatively, which may be difficult, or even qualitatively? That would be very helpful to understand the growth trajectory. Yeah. Obviously, we can't talk about it quantitatively, Kawaljeet. And qualitatively, like I've said, it's only delayed. These ramp-ups should happen. And each deal is different in its nature, right? For example, something like Phoenix, which was entirely net new and fully where there was a clear go-live date and readiness, we've been able to do that, and that's fully into our revenue starting Q3.
Operator: I mean, you can do that as and when you feel it's the right time. Yeah. Is that the way to look at it? Yes. Absolutely. Absolutely. Noted. The second question is for you and Srini. Let's say if those two mega deals ramp up were not delayed, then what would the guidance have been for the March quarter? Any way to detail it out either quantitatively, which may be difficult, or even qualitatively? That would be very helpful to understand the growth trajectory. Yeah. Obviously, we can't talk about it quantitatively, Kawaljeet. And qualitatively, like I've said, it's only delayed. These ramp-ups should happen. And each deal is different in its nature, right? For example, something like Phoenix, which was entirely net new and fully where there was a clear go-live date and readiness, we've been able to do that, and that's fully into our revenue starting Q3.
Speaker #1: Yes. Absolutely.
Speaker #1: Absolutely. Noted.
Speaker #4: The second question is for you and Srini. Let's say if those two mega deals ramp up, so not delayed, then what would the guidance have been for the to-the-March quarter?
Speaker #4: Any way to detail it out either quantitatively, which may be difficult, or even qualitatively? That would be very helpful to understand the growth trajectory.
Speaker #1: Obviously, we can't talk about it quantitatively covered. And qualitatively, like I've said, it's only delayed. These ramp-ups should happen. And each deal is different in its nature.
Speaker #1: Right? For example, something like Phoenix, which was entirely net new and fully—where there was a clear go-live date and readiness—we've been able to do that.
Speaker #1: And that's fully into our revenue starting Q3. So that played out perfectly to plan. Right now, in some of the other larger deals—the mega deals that we could be winning in terms of vendor consolidation—these deals typically have both an element of renewal and new.
Operator: So that's played out perfectly to plan. Right now, in some of the other larger deals, those mega deals that we could be winning in terms of vendor consolidation, these deals typically have both an element of renewal and new. Obviously, the renewal is fully in, and that continues, and we're not seeing any changes in terms of the expectation. In case of the new, the element of new, some of these things are taking longer, either due to client situations where there could be some changes in the client environment that they're going through, and therefore, there is a little bit of a delay in terms of the timing of the ramp-up. Or it could just be the nature of how it is going to play out, right? Because we will have it will take six quarters. That's what I had earlier alluded to.
Operator: So that's played out perfectly to plan. Right now, in some of the other larger deals, those mega deals that we could be winning in terms of vendor consolidation, these deals typically have both an element of renewal and new. Obviously, the renewal is fully in, and that continues, and we're not seeing any changes in terms of the expectation. In case of the new, the element of new, some of these things are taking longer, either due to client situations where there could be some changes in the client environment that they're going through, and therefore, there is a little bit of a delay in terms of the timing of the ramp-up. Or it could just be the nature of how it is going to play out, right? Because we will have it will take six quarters. That's what I had earlier alluded to.
Speaker #1: Obviously, the renewal is fully in, and that continues. And we're not seeing any changes in terms of the expectations. In the case of the new, the element of new, some of these things are taking longer.
Speaker #1: Either due to client situations, where there could be some changes in the client environment that they're going through, and therefore there is a little bit of a delay in terms of the timing of the ramp-up.
Speaker #1: Or it could just be the nature of how it is going to play out, right? Because we will have—it will take six quarters.
Speaker #1: That's what I had earlier alluded to. So, it is going to take that time, and we're hopeful that this will flow through in the coming quarters.
Operator: So it is going to take that time. We're hopeful that this will flow through in the coming quarter. Noted. Thank you so much. All the best. Thank you. Thank you, Kawaljeet. Thank you. Ladies and gentlemen, that was the last question for today. I would now like to hand the conference back to Mr. Abhishek Jain for closing comments. Over to you, sir. Yeah. Thank you all for joining the call. Have a nice day. Thank you. Thank you, members of the management team. On behalf of Equirus Securities, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.
Operator: So it is going to take that time. We're hopeful that this will flow through in the coming quarter. Noted. Thank you so much. All the best. Thank you. Thank you, Kawaljeet. Thank you. Ladies and gentlemen, that was the last question for today. I would now like to hand the conference back to Mr. Abhishek Jain for closing comments. Over to you, sir. Yeah. Thank you all for joining the call. Have a nice day. Thank you. Thank you, members of the management team. On behalf of Equirus Securities, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.
Speaker #4: Noted. And thank you so much, all the
Speaker #4: best. Thank you.
Speaker #1: Thank you, Kawal.
Speaker #3: Thank you. Ladies and gentlemen, that was the last question for today. I would now like to hand the conference back to Mr. Abhishek Jain for closing comments.
Speaker #3: Over to you, sir.
Speaker #5: Yeah, thank you all for joining the call. Have a nice day. Thank you.
Speaker #3: Thank you, members of the management team. On behalf of Vipro Limited, that concludes this conference. Thank you for joining us. And you may now disconnect your lines.
