Wipro's revenue growth continues to slide

Like its peers, Wipro has been affected by uncertainty in the market for offshore services

Wipro said Friday its IT services business grew only 4.6 percent in U.S. dollar terms in the quarter ending Sept. 30, a much slower rate of growth reflecting a weak global economy.

The Indian outsourcer said revenue from IT services in the quarter was US$1.54 billion. The Bangalore-based outsourcer had posted revenue growth of 16 percent for the same quarter a year prior. It forecasted revenue for the next quarter to be closer to $1.6 billion.

Wipro's Indian competitors have also been affected by slow growth in the market for outsourcing services. Infosys, the second largest outsourcer, blamed continuing global economic uncertainties for a slide in year-on-year revenue growth in U.S. dollar terms in the quarter, which declined to 2.9 percent from 16.7 percent a year earlier.

India's largest outsourcer, Tata Consultancy Services, did better, with growth only falling to 13 percent in the quarter compared to 26 percent in the same period last year.

Wipro said Thursday that its board decided to demerge its non-IT businesses such as in consumer care, lighting, hydraulics and medical diagnostics into a new company to provide more focus for its IT business. Infosys and TCS are pure-play IT services companies.

The demerger will help improve profit margins, said Suresh Senapaty, Wipro's chief financial officer, in a conference call on Thursday.

But analysts think that moving out the small non-IT businesses from the company will alone not help. The company needs to focus on using technology to solve business problems, rather than just emphasize on technology, cost-cutting, and increased productivity, said Sudin Apte, principal analyst and CEO of research firm Offshore Insights.

IT services accounted for 79 percent of Wipro's total revenue in the quarter. The company added 2,017 employees in its IT services business in the quarter, taking the total number of staff to 140,569.

IT services revenue grew 23 percent in rupee terms from the same quarter a year earlier, largely because of the depreciation of the Indian rupee against the dollar. The company's revenue growth in rupee terms was 17 percent.

John Ribeiro covers outsourcing and general technology breaking news from India for The IDG News Service. Follow John on Twitter at @Johnribeiro. John's e-mail address is john_ribeiro@idg.com

Join the newsletter!

Error: Please check your email address.
Rocket to Success - Your 10 Tips for Smarter ERP System Selection

Tags outsourcingbusiness issuesservicesfinancial resultswipro

Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

John Ribeiro

IDG News Service
Show Comments


James Cook University - Master of Data Science Online Course

Learn more >




Back To Business Guide

Click for more ›

Brand Post

Most Popular Reviews

Latest Articles


PCW Evaluation Team

Louise Coady

Brother MFC-L9570CDW Multifunction Printer

The printer was convenient, produced clear and vibrant images and was very easy to use

Edwina Hargreaves

WD My Cloud Home

I would recommend this device for families and small businesses who want one safe place to store all their important digital content and a way to easily share it with friends, family, business partners, or customers.

Walid Mikhael

Brother QL-820NWB Professional Label Printer

It’s easy to set up, it’s compact and quiet when printing and to top if off, the print quality is excellent. This is hands down the best printer I’ve used for printing labels.

Ben Ramsden

Sharp PN-40TC1 Huddle Board

Brainstorming, innovation, problem solving, and negotiation have all become much more productive and valuable if people can easily collaborate in real time with minimal friction.

Sarah Ieroianni

Brother QL-820NWB Professional Label Printer

The print quality also does not disappoint, it’s clear, bold, doesn’t smudge and the text is perfectly sized.

Ratchada Dunn

Sharp PN-40TC1 Huddle Board

The Huddle Board’s built in program; Sharp Touch Viewing software allows us to easily manipulate and edit our documents (jpegs and PDFs) all at the same time on the dashboard.

Featured Content

Latest Jobs

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?