Infosys Q4 earnings lower-than-estimates

Infosys' operating performance misses expectations. While among the positives were -- moderation in LTM attrition by 340 bps QoQ, and steady deal intake.

Infosys' fourth-quarter earnings for FY23 came in more bitter than sweet. Overall, the operating performance of this IT giant was lower than the street's expectations.

A sharp decline in attrition rate & strong deals intake came as a + factor. Infosys posted a decline sequentially in both revenue & PAT, while it also carried about 3,611 job cuts in the quarter.

The company announced its Q4 results after market hours on Thursday. Before the Q4 earnings report, Infosys stock dipped by 2.8% to end at ₹1,388.60 apiece on BSE.

The stock dropped by over 3% on NSE. Infosys emerged as the top bear on both exchanges. It needs to be noted that trading in the stock market will be closed on Friday due to the Ambedkar Jayanti.

As a good news to its investors, Infosys declared a final dividend of ₹17.50 per share for FY23. The company had earlier paid a dividend of ₹16.50 per equity share.

Infosys paid a total of ₹34 per equity share in FY23 - rising by 9.7% from the previous fiscal FY22. In Q4FY23, the IT giant's PAT came in at ₹6,128 cr down by nearly 16% QoQ but up by nearly 6% YoY.

Similarly, revenue from operations dipped by 2.2% QoQ but was higher by 16% YoY to ₹37,441 crore in the quarter. Q4 YoY growth was 8.8% & the sequential decline was 3.2% in constant currency terms.

The operating margin for the quarter was 21.0%. Free cash flow conversion was 95.3% for Q4. Continuing the recent trend, attrition declined further in Q4 to 20.9%.

Infosys reduced its workforce by 3,611 employees to 3,43,234 headcount as of March 31, 2023. Emkay Global expects Infosys share price to react 'Negatively' on Monday to the Q4 prints.