Infosys lowered its fiscal 2027 constant-currency revenue-growth forecast as soft volumes and client demands for productivity savings weighed on pricing, even as its AI revenue rose 29% sequentially.
The Indian IT services company now expects constant-currency revenue growth of 1%-2% in fiscal 2027 (FY27), down from the 1.5%-3% range it set after Q1. The lower end of its range fell by 0.5 percentage point and the upper end by 1 percentage point. Infosys kept its operating-margin forecast at 20%-22%. Revenue for the quarter ended Sept. 30, 2026, totaled $5.145 billion, up 1.3% in reported dollars and 1.5% in constant currency from a year earlier.
Sequentially, revenue advanced 1.2% in constant currency. Infosys restates current-quarter sales using the comparison period’s exchange rates to separate revenue growth from currency movements. The sequential figure compares with the June quarter; the annual rate compares with the September quarter a year earlier.
AI revenue represented 10.5% of total revenue and climbed 29% from the June quarter, Infosys said. Contract value from large deals totaled $5.2 billion, with 62% classified as net new work. The company also cited a mega deal worth more than $2 billion.
CEO and Managing Director Salil Parekh said AI was generating growth for Infosys but also contributing to pricing compression. Chief Financial Officer Jayesh Sanghrajka said competition and customers’ higher productivity demands added pressure on prices while volumes remained soft. Parekh cited wars, interest rates and tariffs among the factors affecting large-enterprise clients.
Performance varied by sector. Revenue in Energy, Utilities, Resources & Services rose 7.3% in constant currency from a year earlier, and life sciences revenue increased 32.5%. Retail revenue declined 7.7%, while hi-tech fell 17.3%. Operating margin was 21.0%, down 0.1 percentage point from Q1. EconoTimes previously covered the outlook reduction alongside weaker retail and high-tech sales.
