Infosys Profit Rises 6.2%, Declares Rs 26 Dividend as FY27 Growth Forecast Falls

Stronger earnings meet a more cautious forecast

Infosys reported net profit of Rs 7,823 crore for the quarter ended September 30, 2026, up 6.2% from a year earlier, and declared an interim dividend of Rs 26 per share. Yet the Bengaluru technology services company lowered its revenue growth forecast for the financial year ending March 2027, even as it secured $5.2 billion in large contracts.

Revenue from operations rose 10.7% to Rs 49,244 crore from Rs 44,490 crore a year earlier. Growth was much slower after removing the effects of currency movements: revenue increased 1.5% from a year earlier and 1.2% from the preceding quarter in constant currency.

Infosys now expects revenue growth of 1% to 2% in constant currency for FY27, down from its previous range of 1.5% to 3%. Its operating margin forecast remains 20% to 22%, showing that management still expects to protect profitability despite a weaker sales outlook.

Shareholders have two dates to watch: November 3, 2026, the dividend record date, and November 11, the scheduled payment date. Employees saw a different measure of expansion, with the company adding 4,480 people during the quarter and ending September with 332,542 staff.

What the profit and revenue figures show

Net profit increased by Rs 459 crore from Rs 7,364 crore in the corresponding quarter a year earlier. Compared with the June quarter, however, profit rose just 0.7%, from Rs 7,769 crore. The annual improvement was therefore stronger than the movement between the two most recent quarters.

Revenue increased by Rs 4,754 crore from a year earlier. Against June quarter revenue of Rs 48,211 crore, the increase was about 2.1%. For readers less familiar with Indian financial figures, one crore equals 10 million rupees, putting September quarter revenue at roughly Rs 492.44 billion.

Infosys earned slightly more revenue than the Bloomberg analyst estimate of Rs 49,107.9 crore, but profit fell short of the Rs 7,904 crore estimate. The gap was about Rs 136 crore above expectations for revenue and Rs 81 crore below expectations for profit.

Operating profit rose 10.4% to Rs 10,330 crore, while operating expenses increased 14.6% to Rs 4,971 crore. Net profit grew more slowly than revenue, leaving a calculated net profit margin of about 15.9%, compared with approximately 16.6% a year earlier. Net profit margin measures how much of each rupee of revenue remains as profit after all expenses and taxes.

Why the growth forecast was reduced

Chief Financial Officer Jayesh Sanghrajka linked the revised outlook to competition, pressure on prices and customers seeking more output from their technology budgets. He explained the pressure on the company in direct terms:

We are seeing pricing pressures on intense competition and customers asking for higher productivity. That's reflecting in our revised guidance.

Customers asking for higher productivity want the same work completed faster, or more work completed for the same spending. For a services company, that can make it harder to increase revenue even when demand for its technical skills continues.

Infosys lowered the bottom of its annual growth range by 0.5 percentage points and the top by one percentage point. The midpoint moved from 2.25% to 1.5%. First half revenue growth in constant currency was 1.9%, while the September quarter delivered 1.5%, placing the latest quarter within the revised annual range.

Constant currency figures recalculate revenue using comparable exchange rates. They help readers see how sales changed without movements in currencies making the rupee total larger or smaller. Infosys recorded first half revenue of Rs 97,454 crore, up 12.3% in rupee terms but 1.9% in constant currency, a wide gap between the two measures.

Large contracts grow faster than current sales

Infosys secured large deals with a total contract value of $5.2 billion, up from $3.6 billion in the June quarter and $3.1 billion a year earlier. Those figures represent increases of about 44% sequentially and 68% annually, much faster than current revenue growth.

Net new business accounted for 62% of the total, equivalent to approximately $3.22 billion. The quarter also included a single deal worth more than $2 billion, representing more than 38% of all large deal value booked during the period. That concentration makes the largest contract a substantial part of the headline total.

Total contract value measures the value of work agreed across the life of contracts. Revenue is recorded as services are delivered. A large agreement can therefore support several future periods, while contributing only part of its value to the quarter in which it is signed. Infosys has not given a revenue contribution schedule for the deal worth more than $2 billion.

The company also secured an agreement with Crocs lasting 10 years to support its technology transformation. Other work included supply chain transformation using artificial intelligence for Mondelez International, network and cybersecurity modernisation for Telia, and an expanded technology collaboration with Metsä Group. Investec selected the Finacle banking platform for digital banking transformation.

AI reaches more than a tenth of revenue

Artificial intelligence accounted for 10.5% of Infosys revenue in the September quarter, and revenue from that business grew 29% from the preceding quarter. Applying the reported share to total revenue gives an approximate AI revenue figure of Rs 5,171 crore.

Salil Parekh, chief executive officer and managing director, described the growth as evidence of customers moving from smaller AI projects toward wider use across their businesses:

As enterprises move to AI adoption at scale, the strong growth in AI revenues is a recognition of our differentiated market positioning and client confidence,

Infosys is advising large companies on AI strategy and investing in industry knowledge and technology capabilities. Its work with Mondelez and Telia gives concrete examples of where customers are applying the technology: supply chains, communications networks and cybersecurity operations.

AI creates two forces within the same business. Customers are spending on new AI services, while also expecting automation to reduce the time and cost of existing work. Infosys is therefore pursuing a rapidly growing revenue category while negotiating with customers who want productivity savings reflected in their bills.

Life sciences expands as technology clients retreat

Life sciences was the strongest of the reported business segments, with revenue rising 32.5% from a year earlier in constant currency. Energy, utilities, resources and services grew 7.3%, communications increased 4.1%, and financial services rose 2.1%.

Other industries spent less. Revenue from high technology customers declined 17.3%, retail fell 7.7%, and manufacturing slipped 0.7%. The contrast helps explain why strong growth in selected industries left company revenue growing only 1.5% in constant currency.

North America accounted for 54.6% of revenue, making it the largest regional market, but its revenue declined 1.5% in constant currency. Europe grew 4.6%, the rest of the world increased 10.9%, and India declined 3.5% on the same basis.

North America's share matters because a small movement in a market supplying more than half of revenue carries substantial weight. Growth in Europe and other regions helped offset weakness there, while the largest market remained a constraint on company growth.

Margins hold steady while cash flow falls

Infosys maintained an operating margin of 21%, unchanged from a year earlier and at the midpoint of its annual forecast. In simple terms, it generated about Rs 21 in operating profit for every Rs 100 of revenue before items such as tax and other income.

Sanghrajka credited cost controls and operating efficiency while saying the company continued to make necessary investments. Maintaining the margin alongside lower growth guidance means management expects to keep a similar share of revenue as operating profit, even with slower expansion.

Free cash flow was Rs 8,898 crore, down 8.1% from a year earlier. Free cash flow is the cash left from operations after spending on assets needed for the business. Sanghrajka put the dollar figure at $928 million and said it represented 113.3% of net profit, meaning cash generation exceeded accounting profit during the quarter.

First half free cash flow rose 4.3% to Rs 17,949 crore, despite the September quarter decline. Cash and investments reached Rs 45,232 crore at September end, compared with Rs 37,065 crore at June end, an increase of Rs 8,167 crore.

What shareholders will receive and when

The Rs 26 interim dividend is Rs 3 higher than the Rs 23 declared for the corresponding period a year earlier, an increase of about 13%. An investor holding 100 eligible shares would receive Rs 2,600 before any applicable tax deduction, compared with Rs 2,300 at the previous interim rate.

Infosys estimates a cash outflow of approximately Rs 10,531 crore, excluding dividends on treasury shares. The dividend is a distribution of company funds to shareholders during the financial year. Eligibility is determined through the record date.

The key dates run from the end of the reporting period to the planned distribution:

• September 30, 2026: The second quarter of FY27 ended.
• October 23, 2026: Infosys announced its quarterly results and interim dividend.
• November 3, 2026: Record date for determining eligible shareholders.
• November 11, 2026: Scheduled dividend payment date.

The latest payment continues a sequence of higher interim dividends: Rs 21 per share in October 2024, Rs 23 in October 2025 and now Rs 26. Infosys also paid a separate dividend of Rs 25 per share in June 2026.

Hiring increases as fewer employees leave

Infosys ended September with 332,542 employees, compared with 328,062 at June end. The net increase of 4,480 represents workforce growth of about 1.4% during the quarter. Net additions measure the increase after both hiring and departures.

Voluntary attrition in IT services declined to 12.7%, from 13% in the preceding quarter and 14.3% a year earlier. Attrition measures the rate at which employees leave voluntarily. The annual decline was 1.6 percentage points, indicating improved employee retention.

Women accounted for 39.8% of employees, up from 39.6% in the preceding quarter. Together, the workforce figures show a company adding staff and retaining more employees while pursuing large contracts, even as management takes a more cautious view of annual revenue growth.

Key Points

• September quarter net profit rose 6.2% to Rs 7,823 crore, while revenue increased 10.7% to Rs 49,244 crore.
• Revenue grew 1.5% annually in constant currency. Infosys reduced FY27 growth guidance to 1% to 2% from 1.5% to 3%.
• Large deal value reached $5.2 billion, with 62% classified as net new business.
• AI contributed 10.5% of revenue and grew 29% from the preceding quarter.
• Operating margin remained 21%, and annual margin guidance stayed at 20% to 22%.
• The Rs 26 interim dividend has a November 3 record date and a scheduled November 11 payment date.
• Headcount increased by 4,480 to 332,542, while voluntary attrition declined to 12.7%.