Bengaluru
: Macroeconomic uncertainty, inspired by US President Donald Trump to implement mutual tariffs, when the owners of three of India’s four biggest information technology (IT) services spoke about their full-year earnings in the last two weeks.
Although US President Donald Trump has suspended all mutual tariffs for three months until India manages to secure a trade treaty during this brief window, it will face 27% Levy on its exports to the US.
Of. CEO of Krithivasan, TCS
The largest IT outsourcers, Tata Consultancy Services Limited, shut down the income season on a sombre note, the fastest in four years despite beating analyst’s estimates.
The important marks he made during TCS’s post-kamai media briefing on April 10:
-Theness started crawling in March. TCS was optimistic about the fourth quarter of 2024–25 till February.
-Macroiconomic uncertainty led customers to delay projects and defrales.
There were no cancellations in this form, there was a delay in decision making.
In the march quarter, the company continued to see tenderness in the manufacturing sector, while the auto industry faces uncertainty due to EV recession.
-The fiscal year 2025-26 is expected to be better than 2024-25 behind a strong order book.
Wipro CEO Srini Pallaia
His concerns were echoed about a week later by Pir Srini Pallaia, CEO of Wipro Limited. India’s fourth largest IT firm, which saw a decline in its revenue for the second consecutive year in 2024–25, was the slowest start till one financial year. However, like TCS, it also defeated analyst estimates.
The important marks he made in the media interaction after earning on 16 April:
-Its global industry environment remained uncertain for most years, and recently tariff announcements have only added to it.
-Clients are expected to take a more measured approach, especially in two spending areas: major changes programs and discretionary expenses.
-This macroeconomic uncertainty is expected to affect the speed of revenue growth in areas in the future.
-The tariffs affect areas such as manufacturing and consumer goods.
-The clients are adopting a waiting-and-dagger approach, even the deal pipeline remains strong.
Infosys CEO Salil Parekh
A day later, although the CEO of Infosys Limited, a little more optimistic, voiced similar concerns. Infosys also estimated its fastest start in a financial year in a decade.
The important points he scored during the post-Kamai press conference on 17 April:
-Clients have not stopped technical expenses, and the situation may change quickly.
Clients are interested in cost takeout, automation and efficiency and consolidation.
-So Macro uncertainty has affected the retail area, and the decision cycles are being extended for large deals across discretionary expenses and geography.
-The rivalry environment is stable in overall business because whatever has changed in the macro environment has happened recently.
The pressure on the margin increases due to the committed expenses at the data centers.
Analysts
Keith Bachman, Analyst in BMO Capital Markets:
There are directional trends between GDP/Economic Development and IT services expenses.
-This services are often considered a source of money at the time of budget cuts.
-If we enter the recession in the next few quarters, then we feel that the growth board of IT services will be pressurized.
Piper Sandler Analyst Arvind Ramnani and John Neut:
-The service companies are saying a vigilant customer approach, especially about the discretionary and large -scale change projects.
