INFY - Earnings call transcript Q4 2022

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Operator

Ladies and gentlemen, good day, and welcome to Infosys Earnings Conference Call.

As a reminder, all participant lines will be in the listen-only mode and there will be an opportunity for you to ask questions after the presentation concludes. [Operator Instructions]. Please note that this conference is being recorded. I now hand the conference over to Mr. Mahindroo. Sandeep over and you, to you, sir. Thank

Sandeep Mahindroo

Hello, to discuss Margaret. the Relations everyone, I'm and call earnings Investor Bangalore. in this to team QX from welcome Sandeep Thanks, FYXX release. earnings

outlook open the CFO, Nilanjan. call today us we I'll and risks the the with Salil say that the that along up senior Salil. is of on now on filings other earnings with management available A Subsequently, www.sec.gov. full start which of refers to Mr. must to faces. Joining in with is that company is our which forward-looking team. in be some Roy; anything Nilanjan conjunction our questions. remarks be statement company We'll this for MD, the read found and SEC, on for statement, turn the Please CEO Mr. and members we'll these a by of can over the that Salil with Parekh; call risks the it the performance call note future explanation

Salil Parekh

which terms, exceptional segments a North region on seen joining revenue Services $X market share. Europe with in double looking $XX grew currency digital, digital across grew segments, crossed morning, X are us Good geographies. everyone in business evening in today. to we to a and part our U.S. you revenue, Each and the of had top programs the broad-based constant high call. while and grew was digits. more and Thank transformation. service Growth over clients in the XX%. years. more billion We've We're leadership our and business The America in We're at and The Financial that milestones. lines crossed are XX.X% billion of fastest growth teens. an good we've building is XX Sandeep. of in gaining in good for growth join cloud afternoon annual taking Thanks, on time year

Our digital year. and XX.X% XX.X% revenues for grew now at account for the

Within our digital, and cloud clients. Our billion digital with revenues work faster, $XX capabilities crossed cloud Cobalt significant our a run-rate have traction seen is basis. growing annualized on our

Our operating our increased We benefits. maintaining with robust compensation while by XX%. been growth margins margins these on employees delivered and focus has accompanied of

large at billion and were billion the Our full for deal QX. were wins $X.X year $X.X for

percentage helping Our a us QX, for strong year net and foundation financial for new for was year set XX% up XX% growth 'XX. the

and currency Our QX revenue XX.X% constant terms. year-on-year X.X% growth in was quarter-on-quarter

from 'XX employees. extraordinary our industry-leading delivering not well our in as have as been the Our grateful proud FY I'm for extremely relentless success performance would possible the clients. for commitment without in efforts

months' Our last attrition to increased XX.X%. XX

a attrition a graduates Our college approximately addition had employees. sequential the in X We fourth recruited net In quarter, declined by quarterly we this XX,XXX basis. of XX,XXX points year. financial annualized on

that so overall compensation initiated We strong support is while exercise agenda segments need attention we deep on that review look have a greater talent of financial solid exercise covering This various to capabilities, this plan can in group transformation We we We've recruitment comfort year. our for program. markets. brand and this increases. regular broader focus with ahead. as a penetration increases our an reflection This digital recruitment our their clients enhanced into employee also

the while benchmarks at in individual and look determining As we market past, skills performance, individual will increases. compensation

cutting-edge targeted globally. growth development digital career work opportunity accelerated on focus on innovation and to will We

ago X well. industry-leading has years strategy We've and Our launched delivered TSR. industry-leading us growth served

automation expanding relevance our and digital leadership proposition. our and cloud phase strengthen on ahead we to business, work to our Looking enhance to clients our capability, on also employee tech-related expanding and further the expand curve, plan large our increasing next capabilities in value innovation with the our scaling digital

our employees cost on the in a for give future. ahead strong staying confidence us on focus and and the Our our focus ecosystem, cloud digital

Our to confidence to comfort give for robust deal wins, XX% us XX% large and client sustained currency. deal momentum 'XX guide in pipeline FY constant growth in 'XX, in FY

as looking ecosystem, build our new look at to at our we strategy, our the Our to employees costs that guidance digital the XX% for is work and focus environment now cloud focus the to margin we and 'XX. post-COVID operating XX% result as in ahead related on be FY

segment U.S. currency, we segment. In large highlights grew Financial business business on deal go terms our let large the constant large by the work at wins and lead to XX.X% XX during deal continues programs. wins Services as growth FY 'XX the with me of as segment through X performance, quarter in in transformation

constant key customer enterprise emphasis XX over X increased currency. Energy, We wins around constant large quarter last the segment to for in a for large deals increased segment efficiency have experience, XX.X% integrated product to e-commerce, deal large in The large associated deal in programs Utilities, and XX as especially last segment to programs. vertical lean seeing in continued digital at and and Financial quarter deals legacy focus and XX% digital segment. in and XX clients is across was outsourcing the FY in healthy this further currency. experience, the cost life overall segment. We on continue growth customer pipeline Retail themes constant in the deals of cycle at simplification, revenue Services takeout year transformation. network growth We're see automated operational in transformation Communications digital regions. clients year. in X Manufacturing areas last grew and segment in won Our XX.X% market as and transformation, wins Services this time We chain, in integrated Resources management, on and segment were data deal and We in strongly There see from the operations, 'XX IT management. and deals supply the large currency pipeline. last currency. in for healthy from XX.X% won this the the constant to zero-touch increased growth Growth

by engagement XX.X% currency. in currency. areas total engineering, Ukraine. rated The an edge ratings a INR in driving clients discovery in reducing We year Europe. in seen the We've Infosys' clients between brand which has IoT the of increase artificial I in acquisition vertical for capital allocation, helping XX.X% Clients share, direct are focus a We cloud will marketing proposed we taking 'XX In final reduce accelerated and and strengthen of financial data peace areas. modernization the our computing, e-commerce of ERP engineering, Life grew are and for Sciences want dividend experience theft leader quarter, people of per together launched accelerate constant building, crisis past advocates XX costs. to in digital to a dividend increased commerce. digital capture, over through XX analytics, due were year. express digital as last XX to services, per the branding big the of to and patient and and by Germany-based transformation and drug and agency, supply times cycle an and respect transformation the intelligence. cloud of digital the for company trials area clinical data with to share, chain, creative further the design digital and Cybersecurity marketing based across Russia on Board deals constant to perception. for another XX.X% is humanitarian INR Hi-Tech oddity, increase capabilities. growth further support to impacted experience all With IoT,

Russian Our with relationships Infosys local does not enterprises. have any active

the has based in XXX small employees services transition a than global $X of our hand situation, prevailing our and his a in of these few Russia, is centers. to light made update. With million to less let towards of assistance the a team decision region, from have it over In individuals. humanitarian this Russia Nilanjan delivery Ukrainian to launching we global efforts committed We digitally to a service that, support which XX,XXX me other reskill Infosys To to clients. initiatives program for up relief

Nilanjan Roy

everyone, days. growth dollar X flow our 'XX. stood of Salil. XX% out by at back in fiscal continued fields across cash growth at quarter improved higher previous reduced of highest of robust at portfolio backed which interventions, increases, this for of X billion. midpoint you incremental XX.X% in to and and grew 'XX in as at by environment decade. et Revenues in band double evening, broad-based to and across XX%, years CapEx thank to Operating currency, by in cetera to measures million currency the higher various compensation revenue XX.X% higher for on XX.X% navigated side performance. This EPS the we percentage to broad-based net creation-related by FCF Growth days challenging backdrop X rolled year in constant constant XX.X% terms year. the the added year-on-year XX.X% than pressures, of XX.X% was $XXX on higher We in together. of over the with for digits. of added Return growth promotions, digital which the X.X% Thanks, and to reduce infra increased FY crossed was revenue in In guidance incremental the addition joining X.X% on Free grew was grown and equity a in 'XX year strong segments the supply INR. FY various by prior subcons. for were constant margin yet and profit sequentially. another Coming attrition, in XX verticals The Good currency. spend. a a the margins call. conversion is XXX% was our Consequently, optimizing $X DSO FY focus skill-based XX%.

early growth impact quarter impacted the impacted in contractual part the future. growth volume This to large large to client XXX slightly expect quarter healthy FY client strong Mining quarter during recover the in was to increased XX in related FY X also had XX remained extremely in X giving the provision, compared revenue to by million 'XX. which of QX margins. We user we million seasonality, in compared client FY annual of 'XX. deals and X, clients revenues COVID count XX 'XX. was $XXX in -- Although

up We attrition the environment history, demand headroom is employees, the XX%. ahead. XX,XXX effort capture ever in have robust LTM highest Consequently, while added quarter, in during trainees company's the X net quarter to increased to on-site to XX% we Voluntary utilization mix to as including XX.X%. declined made the

due attrition The increase a continues was above other and attrition flattening X a margins LTM impact points create X% were effect, XXX lower pricing benefit a we days, and rupee X.X% quarterly due and future; dollar follows: higher of salary-related previous components costs visa X.X% X.X% previous which due drop working terms by sequential Quarter days, client benefited Quarter quarter. approximately lead the in calendar we X% to decline of year-on-year offset terms after in impact XX.X%, on to of as X lower tail to annualized benefits, due saw by utilization third-party including lower a X.X% to at EPS quarter. for percentage; and due the to basis. [RPC] the explained approximately major XX.X% working versus to in one-offs, margin grew provision basis as costs, movement in and the contractual costs While capacity these others. other QX, stood

QX. stable has and years, returned to quarter. per Our share capital $XXX 'XX, was at at yield quarter cash increased recommended an INR for FY million, increase Free share, equivalents line per and Board XX the dividend total share in share to the will in versus XX% FCF for on of the of of a the balance allocation remained dividend year. remained dividend recently XX per 'XX have at INR concluded debt-free. final billion last Including policy, over X strong our for the Consolidated allocation of X.XX% capital final the $X.X and sheet of FY policy. with per flow and our under XX.X% for roughly a current cash buyback cash INR end In balance further shareholders result which the we XX

digital talent enabled to last years the building in in localization, investments capabilities, accelerated has systems, strengthening enhancing Our consistent market large our deal few share. gain us

closely activation market with digital more the capitalize engage across and industries, expanding With disruptions we on the further of see clients opportunities. step to

in We cleaning capabilities cloud our areas investments, down and digital enhancing offerings have portfolio, our on including doubling identified our further technologies. focus emerging of

margin a committed through remain value-led holistic of also proposition compelling growth. plan through some to to pricing value offer employees We incentivization to these and We cost a neutralize refilling optimization aggressive et driven and with and career XX%. service the travel differentiation. by guidance XX% some reflected to of revised facilities, in like brand along FY for expenses, cetera, of post-pandemic This, is normalization 'XX

we that, can you few behind open many pandemic months. person up next the With see for the of the hope hopefully call over in questions. to With us, we

Operator

[Operator Instructions].

line JPMorgan. of Rudra The first the question from Ankur is from

Ankur Rudra

The Last least at first revenue much the lower time, question year, the 'XX. And stronger, stronger. the is at on guidance the was the would would Salil, a this order time, -- a I F revenue lot at beginning say, had deal was you say at bit book guidance. I of

mega a perhaps and had rate. in stronger You deal order book the exit a

given So I'm the macro guidance a the beginning more higher curious giving this slightly what volatile maybe to situation? of year, confidence gives a at of

Salil Parekh

Ankur, client the we from is demand base environment is thanks see strong. see This today for Salil. is question. your we our for What what can

expansion new new net and related new of We quarter, for in net dimensions across the relating and work different year, or deals, a to expansion $X.X the expansion. plans XX% billion billion strata within basis XX% client have, in to actual strong client for $X.X large

came those this see view we financial Given growth year. all of factors, a to that the we XX% to for of could XX% range in

Ankur Rudra

this the from quarter? situation to client kind fourth bake that in Does of Understood. you alluded reversal any in

Salil Parekh

we the range a period some will in that of we we're client have market. that of huge existing expansion this that really seeing client time. seeing year this are case, We've within some coming of the not and over full The which that impact. of we new reverse also of the demand seeing in not any specified fourth see acquisitions make is From situation are witnessing. the base the when business the strong that within from was quarter is and the We it in in we what clients the that are --

came this So factors, view. putting to those all of we

Ankur Rudra

appreciate Okay. the I color.

Maybe baked went the quarter you question Just And a which sticky the to third-party level given of a the the been of sort -- last the up the 'XX wage could elaborate the connected sharply reversal deals question, into you new of inflation could including on -- the signing? or very margins. the have are levels, margins, cost extended we is on F pace normalization quarter? this of with, elaborate start that of costs, the costs guidance this and follow-up Is as nature base.

Nilanjan Roy

Yes.

in to new large that you've deal think last which the momentum get a years. bundling with effect like that our is -- and over us the one I and services the we and is gives client So of software the also landscape, services, multiplier seen that few

the and reasons impacts. year-on-year So we've From don't seen forward. we of FY 'XX, quarter cost perspective, us for that's call the and in going the year one helped also has increase the a these out in

it will competitive said, Salil be As hike. a compensation

in have optimization, we more differentiate of will some be will cost course, that, and which skilled We usually high we cases, around talent, lot broad-based. of do. it And a

But in for other following us on-site start subcon will year of some for mix. offshore it and them of a past a the the going way the the last became were Some way to in catering in year year. instance headwind

the us early well in Of as hikes quarter X the in wage will itself. course, on hit year

that but we So cost impact be initially have overall will we the seen the have of a seen -- our optimization. headwind, overall

and longer more which So it of started cetera, and the renewals, the have et of as All making talent, looking longer-term side I more course, have These front the FC on this supply on headway but in I the our at FC the also is the Salil much think started. actually et are started -- we than haul. the people said engaged demand a earlier, sales side, have our But cost. in clients on side -- cetera, this much have T&M on -- we this. overall discussions this -- business. are discussion more bid. think These discussions, happens, It's on competitively some

Operator

Securities. is question next Katri of Moshe from from Wedbush The the line

Moshe Katri

give specific us if great that provision be the more will on mentioned. clarity you can It you contractual some client

a think as impact just impact You're questions a And investors. margin from numbers is this the to helpful. How I a lot of be as well? then Was does going quarter? the there getting really for on clarity any revenue that follow-up.

X obviously, inflation margin months. we points. 'XX, assuming also wage the a for guidance got fiscal down at lower then Looking basis Are assuming you actually which about the to XXX here? of you’ve in are pricing power, the that significant lane something And past for did help XX is levers terms

Salil Parekh

I to clearly. question the first less percentage. numbers hear a are These we heard that just are contraction couldn’t mean Moshe, on the this, than I client very the provision. clarify Yes. you small. --

as So impact, It's What to really at out. overall just it's larger but to to not it people a I impact want not is out close revenue question? sequentially, out. a than if less are just it's we call and X%. that growth looking are making big But the big wanted it

Moshe Katri

The acceleration your factored we're question kind pricing had fiscal do and fiscal inflation in this And asking third 'XX actually margin 'XX. of those an wage a into also if guidance factors for to power with lower not numbers? into maybe

Nilanjan Roy

Okay.

So well. it again said lost something Moshe, you we’ve bit wage could I out about inflation make as but of

do So I compensation site. both will yes, said, offshore be And it quarter as a like and X, will well, on hike in we competitive.

And has is going highest some helped of of the working people course, and seeing well. is, one headwinds guidance normalization talked on So this, of that's benchmark benefit last The offshore, about margin year. of come terms that differentiating us, something that and of on-site course, will are we we're pandemic on right? the which us. the we the the of we overall benefit the we large in We of for got side seen secondly, think events, side, reflects are number towards talent as especially over we some we got a sales well. is as seeing back last have facilities, so to of travel some And have year

So hand, subcon year actually with But seen our quarter, we have the the have see result. recruitment has to over taken and and really opens as year. year. to how to we subcon I'm during the remains rest a this plateaued seen kicking rest Operation of other up in probably able cost have quarter on about. optimization the now, in to building automating this this of between costs people out should X,XXX fourth lines. on and be cost putting We've bots, We is pull very talking up core the us, back every X,XXX

I a So is well. very operate in year a have XX% comprehensive think we talked as comfortable reasonable we next and think And plan, about well. margin band we for are XX% we as to to pricing

If I'm pre-pandemic we We XX% before to ended year even you were a a if in not at recall, way which 'XX, pandemic at XX.X%, mistaken. was XX%. FY

XX% are we happy So And in are to range comfortable to the it's be we a XX%. in.

Operator

from The Nitin line Investec. next question is Padmanabhan the of from

Nitin Padmanabhan

from my side. Just X questions

guidance. one first was on the The

I at So year. typically, right, X high have last the prior visibility quarters. it's wins, actually And very look for new if next lower I than if understand the the deal you year net

numbers is of I the So second, mix smaller first And larger overall talking higher -- within reflect about pipeline is deals deal? much that how the don't confidence? we it that that's the the it that deal could -- it? through there about? was smaller is think a much question. Is a So Or about number? win was the of giving come deals should was wondering just you Is that are that large

Salil Parekh

question. is the for This Salil. Thanks

within give of We to specifying mix. it. different A on today the types some color points are not deals few the

see today First, large the terms is the in of deals. have we pipeline we largest pipeline that

confidence. So us that a gives good

the net Our is for new strong. year

exiting year. share. us momentum gaining financial have gives expanding, are We traction see year, And year good we're next consolidating we we're good foundation market continued clients a as 'XX, as this which we as for within

Hopefully, gives that. that a you gives little us added boost. color bit an that more So on

Nitin Padmanabhan

sure. Sure,

prior much terms I industry was question any you higher the And actually Sciences, thoughts the when you softer, are of -- you Financial we in wage broadly the and The compare saw on-site the relatively the sharp see just a in are the level drop on that year? a inflation Do U.S.? that. for at seeing how on quarter? for wanted space, Life your finally, specifics Services which second

Salil Parekh

come geographies, definitely how outside what were inflation, On quarter, the year were deal India year, our remain In the we segment. of onetime seeing Life numbers in conversely, Western and very for compensation for and what a last smaller will overall that pipeline that's there. become quarter the significant while the we in higher Financial months saw There see the deals was Services. unit we we than We wage demand in Those had and increase. previous than today large On the which the in several we quarter, of in, were most wins the remains is good higher growth have ago. overall us. strong lower, are us It's factor part large Sciences, confident in that inflation the with through. for environment Q-on-Q in Services, Financial XX the came in and they

in So that. there's volatility more much

the in shape. With the in looks underlying Life business still demand Sciences, good

Operator

of is Capital Keith question the Bachman Markets. next from BMO from The line

Keith Bachman

question guidance a terms trends FY that ask be of thinking on And your you and what over what attrition are both your assumptions about correlate specifically, you've what's margin we of to it, wanted How to 'XX? today could I -- XX%? if impact about provided should those here in XX% utilization? the

Nilanjan Roy

Yes.

think, firstly, down. are at still bring end XX.X. want I So to we We utilization, this on higher the

it’ll dollar the a end. in of profit. lower it's by margin lower having if the there's headwind. more utilization it, for because a terms that math that, it's not versus But be at impacting you're the still lot straight that cost behind correlation said sense for will a in one So at right? of will We freshers, no start dollar freshers, looking utilization, putting a this have wage not one The happen in right, sense. influx Now through for of the

yes, the now, The we freshers as it attrition, what So On that think but entire industry, only putting year. that's this because of of come should by thought. down by us impact churn not following industry impact across new source bit well, the supply we a in the of the across in, are the seeing doing freshers, finally, industry. are is the a the industry of now interventions, we rotational as puts is issue and well. And in course, as there which

factored XX%. So our that's all XX% to into

course, are also like Of capabilities, Salil and next investments, also that's at we looking year. said, around cloud, therefore, into around the in digital baked

Keith Bachman

Okay.

floor, Just clarify, then for both? to the attrition industry I and down see Infosys the will does or come or

Nilanjan Roy

It will be both.

are think we the are think silo in a I -- ecosystem. in we I don't

we And takes for production, I only freshers. of we're this, therefore, Volume somebody My in is interconnected. the through all volume, somebody in that is as come my more lapses. that to them then the training, has and seeing into all attrition fundamentally the still with probably into through the start -- to benefits fresher, of them else's with industry has only lapses, the industry and you're lead no pumping well. right? are be think long volume of to bench, the time, seeing source us, them is not out as put has And We if there therefore, in other it also send attrition this, run industry freshers, is else's be

Operator

line question AMC. from is Guntupalli Kotak Sudheer the from Mahindra The of next

Sudheer Guntupalli

our margin comment Nilanjan, were guidance plan and margin, is around that that. you also current at we XX.X% pre-pandemic, made somewhere a

we by should onetime profitability for as FY margin pressures? read of should this of company's going in structural margin more a a So we supply-side see downgrade the more pre-COVID downgrade back this levels? led aspirational 'XX to transient Or reset

Nilanjan Roy

Yes.

we 'XX know, FY have and you But margin XX% only as was the same XX.X%. of range. the give XX%, 'XX to -- the year, guidance for to FY So XX% guidance XX% course

up, to XX%. comfortable So range we're saying 'XX, XX% FY not for that it's but end in, we are going to

make going highly investments And is demand nothing skilled talked to the to This about are So don't I the that. than think not we've talent. environment. more want on only lose We a we talent. robust

are we interventions rolling So out there.

intervention side, rolling side, cloud. on out are marketing We the the the sales digital on on

we've that's interventions. seen X are and at last the results the multiple baked And which the next mean, front something I for success have we years, of year. the into you. So that And in of margin we've looked over

Sudheer Guntupalli

current downgrade March of extension margin 'XX gives exit margin exit FY and bit situation and 'XX, for ago rate margin Sure, March a in sir. the guidance X vu An a in déjà feel question, of it 'XX. exactly the this of years

fact, at like bit a admitted time. so barring margin are staring at we headwinds now, were In an attrition we not many that of

pattern 'XX, So my that the see will question FY any quarters? the growth the terms like delta fair current is, will likely is over out take next of you it a major divergences in where margin the play trajectory next quarters, do how for path X in during of may similar care of the to data assume in somewhat trade margin Or headwinds? X

Nilanjan Roy

think this. I of on me now ahead are you X steps

are side, here. shorter We is to we more we happen are like There impact, longer-term be think, I know I margin So said, there term will put. on know optimization a right? can quarter cost X there's the what going

helped And will seen be of it think impact you've I always all has a impact multiple So in the also leverage the growth of of past. growth on that this. the help. operating course, will And

a combination it's So this. of all

Operator

line next Diviya of question is from Nagarajan from The UBS. the

Diviya Nagarajan

my on Thanks and congrats been overall. year what's great for taking a question

on at how the full some both ways that for of look a has in demand there on the equation of enough are question terms and taken puts up you consistently earlier you delta that the feel think to push I that question. much questions on your in came by pretty the sides you your you've if is is you also what comfortable different guidance there think year been this attempted -- do any room you past times multiple I my forward, as if were have record, guidance about buffer revenue the I for think track Is first see kind during through. But in? Looking year. and of of takes might about think

Salil Parekh

Diviya, our have tried take growth way of deals, Hi, is thanks what for where we demand we accounts. what Salil. to seeing across are This The our question. -- guidance, really a done we large is today, look at many the where at is we with the look

the the XX over of seen example, if we movements we million XXX For last see XX XX, you of million, accounts share, XX, number have some over that or statistics big months.

-- year that then to coming we new the every approach we communicate the And things are in So and we account working the try as April we Those that's have ahead. same And on in on we the the in It's how some that move and of see demand environment. take how year approach view April are moves guidance. are information, to other in then then we'll and we build the built we follow. what to get best the will look acquisitions seeing how as year focus. as we

what the broad-based and the then share a we And what it's for demand Because growth. to every interactions example, with we difficult, is say does a will XX% continue what the cushion. see cushion it stage, sharing, with clients have with which to see this to at the are connections mean, across on XX% is quarter, it's not environment. to what So industry, or we we we respect

Diviya Nagarajan

that your other I growth. be investments? you've Could Could the of to all think about roughly margin, you And on and the likely spoken down X%. were is about talked metrics repeatedly split the what if margin guide investment -- it. the are you that of kind you've your taken contribution it Got you into the to And would split you future really by investments for Got side, what of reverse. contribution it.

Nilanjan Roy

Yes.

have lot we said we a the one. say, headwinds So have headwinds of, biggest -- I the year, we since every like on that's like I have past compensation, in

facility year now on side travel, headwinds have the on as things coming We first the the this up. open on

us. sales offshore, will the be And are other capabilities, going year, behind side. been people behind incentives during then we hand, will again, higher will will the will across the quite on behind has to be we cloud on which make, years, optimization which this we be this have against be the all this makers, all this side the we behind On sales investments and automation, running on-site program, the close subcon cost well start

not So combination all into so we're considerably well of that it's been all and this, separate sector. the a the of out really margin has calling impact,

Diviya Nagarajan

Got My may. last I question, it. if

some like the assume I that subcontracting the up visa visa market? impact the your now should X% to you've offset higher the kind pressures quarter, you've had opening had that that in costs traveling is So applications with of of almost in Russian increased

Nilanjan Roy

Yes.

X% as was X. one-offs walk I was That quarter a It impact walk costs So other in margin third-party combination we and of had… visa. mentioned, in margin was in the the the which enjoyed we’ve

Operator

The next line of Kapoor question from is CLSA. the Pankaj from

Pankaj Kapoor

in investment you onetime XXXX, and that these again of. Or is similar doing business? the had in spoke so investment? regular way the which more kind are 'XX, keep to any margins done the just of investment on that you question you are The investment, of these more wondering, was I

Salil Parekh

question. the for This thanks Salil. is Pankaj,

see a out We a I that digital, good we now we tech we the across consider those so think tremendous cloud, or in want years, a automation of the build in at deeper the that to we months, it are strategy looking areas built building see demand impact years. ago. which It's from be new is year onetime -- areas. way going the and the something again, capability shift mobilized. operating to last for it did we the activity approach then this want X into that new in to business capability quarters But an a us. we our few is try We And X advantage take opportunity that to We market see first get we time, some next to share that not of itself. set, we since was did years in over now growth want on X approach. which inflection are what want of sort we multiple for that X areas. across like a companies. to, leading continuous years make we what to over seeing X, That now and of the past a in few digital we've the X coming to last place position the as a deep we We build point and sure had that, see capability put of we environment, take with keep

Pankaj Kapoor

outlook larger on in the case be the that impact around And the on also any is taking macro in -- worries more What what's maybe inflation basis? question Or an Understand given? the Europe the was guidance you revenue in around concerns happening if the And Are guidance to we've the is your are end guidance macro any of whatever the macros, the in kind probably half other for building Eastern of on side. or the your you markets? there deterioration that. even would the that incremental in of the year? second as-is that incremental in on

Salil Parekh

XX% this we a in the see if Today, see go and you we mentioned is we to don't what built make and demand impact macro how in on. QX, clear it. today, XX%. don't we let's see the environment. we we But what that to say, be estimate that is of for, given Based in at have we an our view points a at any will range are we are level QX, of it on of And environment, feel as what seeing will environment look to the the that we the as that, We evaluate growth comfortable so will have sort guidance through.

those in We see have -- impact many not factors environment today the an we demand really don't of today. in

Operator

of from next Singhal The from is the PhillipCapital. question line Vibhor

Vibhor Singhal

questions couple the part. again a So on European of

there last longer-term years, a same of last second, in the other we question fact, on analytics X, question as first the a years for -- hiring your Eastern -- and for as operations that lot and other across evolved work of basically to already by has and to Do it war Eastern wanted situation the we now maybe domains countries So situation, the is you on my I temporary quarters think with or in and as is just specific geography maybe more Europe have looking them that, -- extent? lot in X for Or as maybe so attractiveness -- parts in some they a of once that hiring this you are before? Europe seen that, it's a was possibility is those pushed there mean, what Eastern I is of I the that And still mean, will some situation, the very to is well, X negativity and geographies of But have Europe limited. vein this back down is to and in? that take destination curtailing understand Or X mean, for, companies, you many to few back current than clients believe are creeping years? like? our as I more the a do exposure have over to a mentioned come Russia data Russia domain. multinational it clients those is resolves, a who the conversation conversations

Salil Parekh

the both think I I So questions. caught

of any clients first demand Currently, clients, so us environment in and with Let Europe in demand was, in our on impacting me just I've that's conversations the see for this question? repeat, is discussions European impact don't Ukraine situation the your understood because situation. if any

next on go depending Of so on, see and duration on. plays we through so other course, as the quarters out the and few we will

second one, quite Eastern Ukraine. we have we the for and course, we of for recruitment example, the center in centers, us. Europe, Today, situation in growing well have, see that On countries no in

we and we impact in obviously impact expanding an be might There we've areas with what been today centers don't that see for seeing. in, well, other are The has Ukraine. developed quite

So other Europe, growth good we our Eastern seeing centers. geographies in in which those are centers, are in

Vibhor Singhal

understand, Poland, countries business continue Austria, to in attractive they So grow if businesses our will other to and I us hire specifically for like Hungary, there. remain

Salil Parekh

locations and are the and we Romania scaling and are have we up Poland actively where those in recruiting locations. centers

Operator

the Ravi from of from Macquarie. Menon next question The is line

Ravi Menon

this whenever Just for margin to like if a the pass-through pass-through can not Should it's assume I customers costs have tailwind on as let's they software, your we option, procure it reduce? these clarify think Because themselves. say, ServiceNow this of costs. that

at would are I that assume that So zero markup. these be Would correct? done

Nilanjan Roy

Yes.

services I think the long-term proposition, value are with bundled contracts, highly is these which these So and software. we have,

sale. of it So sort is not a one-off

this can with that services we and cloud, bundle I the cetera, think et that's have. the integrate into vertical the proposition into with us, is that we that stack, the

way the that's we at. So look

Ravi Menon

for margin margin was this we for we is whether a this client assume the should correct? zero and as question assume a tailwind? But mean, I and this that a my you that -- can should of this? for ask actually that margins accordingly? it, procure what think the Should assume is adjust I margin the implement we to because just

Nilanjan Roy

this Software Service, and growing the where as And value. can right? as overall dramatically, see market come in is a this that's add But you we for something

have So there's of not kinds as software X client there who horizontal with clients X multiple various software, well. are

said, proposition quite we this is is think, have, for unique I a I which like us. So which

see with client. So we intervention as can't X it just one-off a

Ravi Menon

your third-party for are own? is these you I that intellectual bought these delivery? Are software you service saying thought This are property? items

Nilanjan Roy

SaaS are we -- to that I are said, of value No. course the of clients. like which it, these software, the which These with owned proposition we bundling but vendors, is the are our services, by give do

Ravi Menon

pass-through quarter take increase offline. million]. million, added $XXX added million. second of north I we I'll quarter, Last remember in the is costs you on, quarter, question incremental And fine. [$XX this this we've is Then $XX if That's the revenue correctly. look if this at about

services dropped if adjust surprisingly a that, So revenue has strong I actually environment. for demand your in

this certain So Sciences in but out you board. Europe, it have come revenue is a decline how mean, that has should I North you or to Life across X it -- seems -- down than drag and seen more be And America increments there it we it's particular mean in right? across I the vertical client. not is board, projects is that the about I think mean, an end? we've to it?

think we should how -- that? about what So

Nilanjan Roy

Yes.

So has strong like first growth said, I very volume been we think sequentially firstly, time.

right? higher. XX,XXX And added Our volume average right, this look to than point, is was XX.X% are into for you people for higher put they XX.X% the of demand, for Number Second two, hired I'm numbers them these being see if year-on-year, for quarter. sequentially We've it exits year. center and versus year-on-year many year, assuming the production.

that's So you’ve got. third the signal

had talked And some last of on talked calendar of you the a what seen the puts And quarter COVID if in from part X day seasonality volume the a perspective us. impact. theme, the some of you because with quarter increasing X about of For the look revenue the volume versus and back we've versus January initial this always impacting about X, there therefore, takes. seasonality We we've the X revenue of had see sort for in part years, client. are lead contract of one-off We've initial working we other just commercial X.

any won't XX of XX% in at last start We years a part we think which So see the just probably guidance can have the we of I to guidance I the year ever in highest at quarter least. XX%, don't think given -- have given the X isolation. is for

think the indicators are demand all very and good. landmarks looking I So

Ravi Menon

Hello?

Nilanjan Roy

Yes.

Ravi Menon

sorry, I'm Nilanjan.

I think it. a difficulty here. technical I had I lost

a down to one it should be Or that talking lot a So think good down should would or Would sufficient? question, last it What be would utilization, coming you're that about? about think XX% about cooling we so, little. we range lower? a

Nilanjan Roy

Yes.

down So we well. be the go a that it XX% somewhere up range where is as would would around comfort about, more in quarter, the number but where in be

Operator

The next the Susquehanna. is from Friedman of Jamie from question line

James Friedman

the related? you else you're costs visa in was you plateauing. that why just believe aware wondering prepared Nilanjan, be mentioned that something anticipating we subcontractor I I Or Is that are of? concluding is are that remarks there that? your should

Operator

Members of you. cannot the management, we hear

Nilanjan Roy

get You that? answer? Ravi, did didn’t you the get

Operator

request you, the hear cannot hear We Now sir. we answer. repeat? to May can I you

Nilanjan Roy

All Okay. right.

subcon So I pretty much costs our are XX.X, XX.X. at around mentioned, like plateaued

ramp-up a subcons in percentage the down. exit -- one higher the whole or an of come of from bit reasons actually headcount think actually revenue perspective, engine a has is recruitment the from I for was of behind. And quarter, it this our

and quarter, our subcon. being we offer as X% demand look of close by of will exit replace either program you mode hiring continue hired, therefore, basis, balanced them And to subcons a the a through XX,XXX we a people freshers, these which about of we to what the exit getting into ahead, With fulfilled us So added are on XX,XXX, headcount XX,XXX was were replacement recruitment people penny company. of hiring the the already. on of push now many which we the and call in full-time subcons or terms we employment system each within

that. doing been we've So

at lowest the the XXXX, industry We have been 'XX. of in

where So we may get take press us lever we we know It know have the at. time, to on. can that's some few margin a we but quarters,

James Friedman

little the provision. a afraid it? you muffled. was believe, I that had repeat quantified I'm Nilanjan, the you Could call impact the if then stated contract you percentage also And client

Nilanjan Roy

And of It's period a time, should than percentage. Yes. think come a back. in we this less

Operator

line The question Rakesh the of Paribas. from from next is BNP Kumar

Kumar Rakesh

have which the the first My and question more a was around guidance margin bit. we reduced

of margin some other especially pushing some which things cost structural the which have side seeing, through the talked supply the making? you So are of some transient the while constraint Or impacts of along investments and is structure things, growth, which we about that the cost reflection a down. about, change this are of of some essentially is in making? with are deals which we our So we a third-party there are of and comes strong we which additional

Nilanjan Roy

I last part is think clear. quite the Maybe

which seen you've large large in $X about or we were strategy, think were announced and at beginning deal 'XX that doing of XX%. we FY billion our I actually If deal margins their and 'XX,

$XX to $X So to billion. to we $X billion, from went billion $X billion

So went while these our margins large even deals up, up. actually went

share. So can some impact of that which we

comes a close margin. out deal upfront. do because deals portfolio headwinds pricing, the there of we clients of able lever go part to large we how cost have that price the we year, period initial course, tenure, have of the take and deal when course, of so want savings But over are costs the once of the are which Of in the we into time, we

been X, So for X, X XX that's something years, this doing the we've in last industry. years

right? around the I what more the differentiation And terms in we've we numbers that the is is have robust normalizing, to the investments think offshore. talked And the of we -- course, in of I seen so headwind, make invest talking pandemic we've the the all done. capabilities the environment, cetera, mean travel we're and which as should think the -- et on-site, we think cost utilization, big much I about, progresses. about past, have the impact this usual you want we about in these demand we year

can some what start returns normal. So come going those already is And you you subcon back in triangulating of on to have costs.

Kumar Rakesh

I large Our quarters. been the which smaller deals $X.X steady getting the not few is which $X activity we size, lot here. also billion, between have of billion understand report for in a last reflected the deal is happening

on deal on So how been would an sharing you Or would consider overall the size, give a trending? data ongoing that’s basis? sense you

Salil Parekh

So this Thanks Salil. that question. for is

not stage, sharing outside. this think we that I at data are

deal of mentioned, a in the focus is few example, What was which some of to the large of value. for have you course, change share a and revenue ago, years digital Our sort the made accurate. we areas percentage

activity tremendous across have sizes. We deal all

new on and growth also very pipeline which net guidance. our robust into overall feeds little with have the a earlier also very conversion We discussion revenue bit a a debt, robust

Kumar Rakesh

which Great. about fiscal fresher set you One have year. done this talked I fiscal Any think for which is, next that final hiring, heard we XX% have thing I you target year?

Salil Parekh

beyond we've campus campus XX,XXX for communicated will more next do we than For recruits year's that recruiting, year. not next that saying

As program. on an But recruitment we go the active will communicate that. we today, through see more we year, campus

Operator

question next Shah from the line from is of Sandeep The Equirus Securities.

Sandeep Shah

Most questions answered. the of

understand utilization, Just adding and And as to including trainees are big the you trainee as excluding quarters. XXX the seven points. between last wanted gap freshers basis for

margin it half? versus of the bias are second it -- pricing, fair more may first 'XX is with say So expecting subcontracting upward may fair be a and to also FY half tailwind say lag to cost savings. also to Is have that, you

Nilanjan Roy

Yes.

lead the I they go trainees think whole through they like they reskilled then them go towards cetera, I into have to specialty through these skills, said, on production. get then the match et bench, skills and

as and So well, trainees, this it takes well is, of time and excluding see including you one course, is some gap. the trainees why as

trainee course, of projects. HX, a in perspective, well from HX. have have, But the a not quarter-to-quarter, we an count margin as So overall been this deployed of big sure I'm in between headwind the increase not part of is

the is X comp -- overall, can comfortable. XX, that XX, years it's upfront, as for go we which But think HX the probably quite back see and of you that I and at year, well. happens, because right, one are

Sandeep Shah

Nilanjan, Okay, just just clarification, has to asked. And okay. what further a Ravi

volumes saying at you if growth, time, the up. gone marginal are same the but decline, at even look revenue So [excluding pass-through], you also the have

gone the down. effort offshore it has is this quarter So not in actually

as growth ex So pass-through a revenue the in reflected it getting not the is this quarter is in growth is whole? volume the why lower? So slightly realization

Nilanjan Roy

That's that's just guess without some are routine a always see right? seasonality correct? back, the There is Because rate straight I days, if you takes. of puts go volume, always and cut No. one calendar you impact. working the revenue will

is one second initially part The the year. COVID the of

third the that contractual the -- contract thing made provision X for client. is this The -- one we

you've to where areas sequentially have correlate if volume benefit we said, that. flowing not seen like that the Salil strong into are quarterly -- also revenue, these think seen I you're volume. So trying And

Operator

for I that management the closing and the hand was today. for Ladies gentlemen, comments. now question the last conference to over

Salil Parekh

mentioned. is Thank discussed for a Thank we Salil. want joining I to you. This us. just you, all points and everyone, couple of reiterate

strongly First, and share XX% market growth, margin. us, really all FY our taking connecting digital the extremely and 'XX We're clearly for year close to cloud XX% very work. was an for with strong clients

market the been share focus leader sure the that cloud, we've the opportunity go and that that, we want ahead, in data, continue automation. in we to on doing. And taking to pack As we a digital, remain we analytics, set ever-expanding make doing in want

our increased guidance we a increases methods to the employees want year and We and all XX% a to engagement to XX% with working 'XX margin this progressions. growth that for Putting of financial of also increased compensation on come of together, XX% focus to of and XX%. guidance career with

again, year and with up of and a this to look working strong our Take employees for outlook catching and clients to care. the in be have forward financial outlook, everyone, during one-on-ones quarter. Thank We we any you, 'XX. in forward for to joining delivered the look

Operator

joining Infosys, much, members for disconnect and of very lines. Thank concludes of the that you this us you gentlemen, your on Thank may now Ladies conference management. and call. behalf you

Infosys Limited (INFY) 13 Apr 222022 Q4 Earnings call transcript