In a sign of tough times for the software services companies, Infosys has reduced the average variable payout at an organisational level to 60% for Q4 FY23. The company has informed the same to its employees in an internal mail. In the first quarter of FY23, Infosys had lowered the variable payout to 70%, which was subsequently reduced in the second quarter to 65%.
It has said that an employee’s final variable payment will be governed by their unit/department guidelines. “The performance bonus payment for delivery and business enabling functions for Q4 FY23 is scheduled to take place in the payroll of May 2023,” Infosys has informed the employees.
“While FY23 was a year of strong performance overall, the quarter that went by (Q4) was impacted by a volatile market with unforeseen events. As we remain vigilant to the changes in the market, we must also see this as an opportunity to rally as a group and remain committed to navigating the changing business landscape,” Infosys has told the employees.
Also read: Silent sacking grip Indian IT sector, impact over 20,000 employees
Aditya Mishra, MD and CEO of CIEL HR, said, “A month ago, IT companies were giving outlook that things will improve in October-November. However, now it looks that the same would get pushed to early 2024”.
He said that clients are not releasing budgets for IT spends, spreading the projects over a longer period of time. For instance, in some cases, six month tenure projects are getting spread over 12 months.
In FY23, Infosys posted a 15.4% growth in revenue in constant currency terms, which was below the lower end of its guided range of 16-16.5%. However, the company was able to meet its operating margin target, which at 21% was at the lower end of the guided range of 21-22%.
The company has given a revenue guidance of 4-7% in constant currency terms for FY24, which underlines the challenges being faced by it in the current fiscal. Operating margin is expected to be in the range of 20-22%.
During Q4, both, its consolidated net profit at Rs 6,128 crore and consolidated revenue at Rs 37,441 crore, were below Street estimates.
Stay connected with us on social media platforms for instant updates click here to join our LinkedIn, Twitter & Facebook
