Wipro Limited on Friday predicted a bleak outlook for the third quarter of the financial year, while announcing that its profits decreased by 7.6% in Q2, Reuters reported. The company cited increased staff costs as a reason for its drop in net profits to Rs 2,070 crore for the quarter that ended on September 30 from Rs 2,241 crore in 2015. Its second quarter performance, however, exceeded analysts' expectations of Rs 1,972 crore in profits, according to Reuters data.
India's third-largest software firm said the uncertainty triggered by the United States presidential elections, Brexit, furloughs and a decreased number of working days would hamper its revenue growth in the quarter that ends on December 31. According to Reuters, Chief Executive Abidali Z Neemuchwala said Wipro would be "cautiously optimistic about the next two to three quarters."
On October 10, a report said India’s information technology sector faced its worst second-quarter performance in eight years. The report said revenues at the country’s largest IT companies are expected to grow between 0.5%-3% during the quarter compared with the previous one (April-June). The report cited “broad-based” weaknesses in the banking, financial services and insurance industries as well as the economic fall-out of Britain’s decision to exit the European Union as reasons for the drop in performance.
Tata Consultancy Services had claimed weak revenue growth on October 13, while Infosys reduced its yearly revenue growth guidance twice in three months. TCS reported a net profit of Rs 6,586 crore with earnings of Rs 29,284 crore for the second quarter (July-September) of the financial year.