Infosys (INFY) Q2 26/27 (Media) earnings summary

Executive summary

• Q2 revenue was $5,145 million, up 1.5% YoY and 1.2% QoQ in constant currency; operating margin held at 21%.

• Large-deal TCV reached $5.2 billion, 62% net new, including a mega deal exceeding $2 billion.

• AI revenue reached 10.5% of revenue and grew 29% QoQ; FY27 revenue guidance was revised to 1%-2% growth in constant currency.

Financial highlights

• Q2 reported revenue was $5,145 million, up 1.3% YoY; H1 revenue was $10,227 million, up 2.1% YoY.

• Q2 net profit was $817 million versus $839 million YoY; H1 net profit was $1,637 million versus $1,647 million.

• Q2 basic EPS was $0.20, down 0.3% YoY; H1 basic EPS was $0.40, up 1.7% YoY.

• Q2 free cash flow was $928 million, down 15.7% YoY; H1 free cash flow was $1,883 million, down 5.1% YoY.

• Q2 margin impacts included customer support (-70 bps) and acquisition amortization (-20 bps), offset by currency (+40 bps), calendar/workdays (+20 bps) and Project Maximus (+20 bps).

Outlook and guidance

• FY27 revenue growth guidance was revised to 1%-2% in constant currency from 1.5%-3%; operating-margin guidance remains 20%-22%.

• H2 margin headwinds include compensation costs and pricing pressure; Project Maximus is expected to offset some impact.

• The net-new mega deal is expected to ramp from late Q4, contributing over 1% revenue growth next financial year and only a minuscule benefit this year.

• Full-year graduate hiring target is ~20,000; more than half were hired in H1, including 8,000 in Q2.