Infosys (INFY) Q1 25/26 earnings summary

Executive summary

• Revenue grew 2.6% sequentially and 3.8% year-over-year in constant currency, reaching $4,941M, with broad-based growth across major industry groups and geographies.

• Large deal wins totaled $3.8 billion, with 55% net new, including a mega deal with a global bank.

• Enterprise AI leadership, client consolidation, and digital transformation were key growth drivers, with 300 AI agents built and strong adoption across sectors.

• Free cash flow reached $884 million, over 100% of net profit for the fifth consecutive quarter.

• Basic EPS rose 5.8% YoY to $0.20; ROE improved by 140 bps to 30.4%.

Financial highlights

• Consolidated revenue: $4,941M (up 4.8% YoY, 2.6% QoQ); INR 42,279 crore (up 7.5% YoY, 3.3% QoQ).

• Operating margin was 20.8%, down 20–30 bps sequentially and year-over-year.

• Free cash flow: $884M (down 19.2% YoY); FCF conversion at 109% of net profit.

• Consolidated cash and equivalents stood at $5.27 billion after FY25 dividend payout; yield on cash was 7.2%.

• Utilization including trainees rose to 85.2% (up 30 bps QoQ); attrition increased marginally to 14.4%.

Outlook and guidance

• FY26 revenue growth guidance revised to 1%-3% in constant currency (from 0%-3%); margin guidance unchanged at 20%-22%.

• Free cash flow expected to remain above 100% of net profit for FY26.

• H1 expected to be stronger than H2 due to seasonality; environment remains uncertain with cautious client spending.