Introduction
Infosys reported a strong performance in Q1 FY26, with consolidated net profit rising 8.7% year-on-year to ₹6,921 crore and revenue growing 7.5% to ₹42,279 crore. The company secured $3.8 billion in large deal wins, with 55% being net new, highlighting strong client demand. Digital revenues accounted for 62.5% of total revenue, driven by the growing adoption of AI, cloud, and data services. Europe led regional growth, while financial services and manufacturing were key industry drivers. Infosys raised its FY26 revenue growth guidance to 1–3% in constant currency. GetMyIndia.com
Guidance and Earnings Details
Infosys said it expects revenue growth of 1–3 percent in constant currency terms for FY26, revised up from 0-3 percent earlier. The firm maintained its operating margin guidance at 20–22 percent.
Operating profit rose 6.2 percent to ₹8,803 crore, while the operating margin stood at 20.8 percent, slightly lower than 21.1 percent a year ago. Earnings per share increased 8.6 percent to ₹16.70. Free cash flow for the quarter stood at ₹7,533 crore, down 17.7 percent from the year-ago period, but accounted for 108.8 percent of net profit.
Revenue & Segment Performance (Q1 FY26)
Infosys reported revenue of ₹42,279 crore, up 7.5% YoY, with 3.8% growth in constant currency (CC). Europe led regional performance with double-digit growth, driven by strong demand in banking and retail. North America, which contributes over 56% of total revenue, grew modestly at ~0.5% in CC. The financial services (BFSI) segment was a key growth driver, benefiting from large digital transformation deals. Digital revenues now account for 62.5% of total revenue, reflecting continued client demand in AI, cloud, and data services.
Deal wins and Business details
The company signed large deals worth $3.8 billion during the quarter, of which 55 percent were net new. CEO and MD Salil Parekh said the performance reflected “the strength of our enterprise AI capabilities, the success in client consolidation decisions, and the dedication of our over 300,000 employees”.
CFO Jayesh Sanghrajka added, “Q1 performance is a clear reflection of our unwavering focus on multiple fronts resulting in strong growth at 2.6 percent QoQ, resilient margins at 20.8 percent, and EPS increase of 8.6 percent YoY.”
Among industry segments, manufacturing saw the strongest constant currency growth at 14.8 percent year-on-year, followed by energy, utilities and services at 7.2 percent, and financial services at 6.3 percent. Life sciences revenue declined 6.6 percent. In terms of geography, Europe posted a 16.2 percent YoY growth in constant currency, while North America remained largely flat at 0.5 percent.
Employee Metrics (Q1 FY26)
Infosys had 323,788 employees as of June 30, 2025, a slight increase from 323,578 in the previous quarter. The company maintained a stable workforce amid cautious hiring. The voluntary attrition rate (LTM) rose slightly to 14.4%, up from 14.1% in Q4 FY25 but still below the high levels seen in FY23. Infosys continued investing in upskilling and GenAI training, with over 300,000 employees trained in GenAI fundamentals to support digital and AI-led projects.
“Our performance in Q1 demonstrates the strength of our enterprise AI capabilities, the success in client consolidation decisions, and the dedication of our over 300,000 employees”, said Salil Parekh, CEO & MD, Infosys.
Management Commentary
CEO & MD Salil Parekh highlighted a strong start to FY26, citing solid deal wins and increasing client demand for generative AI solutions. He stated: “We had a good start to the financial year with strong large deal wins, robust client interest in generative AI, and healthy margins.”
CFO Nilanjan Roy emphasized financial discipline, saying Infosys maintained margin resilience despite wage hikes and continued investments. The leadership reiterated focus on AI, cloud, and digital transformation, aiming to scale innovation and deliver long-term value.
Conclusion
Infosys delivered a strong start to FY26, marked by robust deal wins, resilient margins, and continued momentum in digital and AI-led services. Despite macroeconomic uncertainties and a modest growth in North America, the company saw strong traction in Europe and key sectors like BFSI and manufacturing. The revised revenue guidance and stable margin outlook reflect management’s confidence in sustained growth, backed by strategic investments in GenAI and digital transformation. With over $3.8 billion in deals and over 300,000 employees trained in GenAI fundamentals, Infosys is well-positioned to capitalize on evolving client needs and drive long-term value.
