PTI BENGALURU: Wipro expects improvement in its performance to be reflected "much more strongly" in the later half of 2016-17 even as it issued a muted outlook for the July-September quarter.
The city-based firm, which posted 2.6 per cent sequential rise in IT services revenues at $ 1,930.8 million in the April-June quarter, expects an almost flat growth in the coming quarter.
"We expect the trajectory of growth to build gradually over the course of the year. We will drive operational improvements in Q2, but we may not see the full benefits because there are two additional months of merit salary increases that will come into effect," Wipro CEO and Member of the Board, Abidali Z Neemuchwala said.
He added that he expects "improvements will be reflected much more strongly in Q3 and beyond".
Wipro's peer Infosys shared a similar sentiment when it lowered its dollar guidance for 2016-17 to 10-11.5 per cent from 11.8-13.8 per cent (projected in April) due to currency volatility and headwinds.
Infosys does not give quarterly guidance.
On the impact of Britain's exit from the European Union, Neemuchwala said while Brexit hasn't had any immediate impact, it is "on the top of the mind".
"Brexit's immediate impact is on the currency. In the medium term, we believe Brexit could delay some of the decision making, but we have not seen any immediate impact of it," he added.
Wipro's peers have also indicated that they are in a "watch mode" even as analysts indicate that technology spending could be impacted, especially in the banking, financial services and insurance segment on account of the UK's exit from the EU.
The Azim Premji-led firm attributed the fall in margins and effectively net profit to wage hikes and headwinds in its India and Middle-East business.
Neemuchwala said the company has given "healthy salary increase" to its employees.
"We are focussed on building a sustainable business model. We have completed the restructuring of our consulting business and we are working on restructuring our India and Middle-East business model," he added.
The city-based firm, which posted 2.6 per cent sequential rise in IT services revenues at $ 1,930.8 million in the April-June quarter, expects an almost flat growth in the coming quarter.
It has guided for a revenue of $ 1,931 million to $ 1,950 million for the July-September quarter, translating into less than one per cent sequential growth.
"We expect the trajectory of growth to build gradually over the course of the year. We will drive operational improvements in Q2, but we may not see the full benefits because there are two additional months of merit salary increases that will come into effect," Wipro CEO and Member of the Board, Abidali Z Neemuchwala said.
He added that he expects "improvements will be reflected much more strongly in Q3 and beyond".
Wipro's peer Infosys shared a similar sentiment when it lowered its dollar guidance for 2016-17 to 10-11.5 per cent from 11.8-13.8 per cent (projected in April) due to currency volatility and headwinds.
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Infosys does not give quarterly guidance.
On the impact of Britain's exit from the European Union, Neemuchwala said while Brexit hasn't had any immediate impact, it is "on the top of the mind".
"Brexit's immediate impact is on the currency. In the medium term, we believe Brexit could delay some of the decision making, but we have not seen any immediate impact of it," he added.
Wipro's peers have also indicated that they are in a "watch mode" even as analysts indicate that technology spending could be impacted, especially in the banking, financial services and insurance segment on account of the UK's exit from the EU.
The Azim Premji-led firm attributed the fall in margins and effectively net profit to wage hikes and headwinds in its India and Middle-East business.
Neemuchwala said the company has given "healthy salary increase" to its employees.
"We are focussed on building a sustainable business model. We have completed the restructuring of our consulting business and we are working on restructuring our India and Middle-East business model," he added.
