Infosys Ltd. raised ts annual revenue outlook after eking out a 1 percent rise in quarterly net income, as newer digital services helped it bag contracts despite shrinking client budgets.
Asia's second-largest outsourcer of IT services forecast a 7.1 to 9.1 percent climb in revenue for the year ending March 2018 on a U.S. dollar basis. That beat analyst estimates and its own previous outlook, both of which projected growth of 6.1 to 8.1 percent.
Infosys should be able to perform strongly despite a volatile macroeconomic environment, said Vaibhav Dhasmana, an analyst at Jefferies India. A stabilizing consulting business and strong uptick in spending in sectors such as manufacturing and financial services could bolster revenue, Dhasmana wrote in a note last month.
It reported earnings on Friday marginally ahead of market projections just a day after larger rival Tata Consultancy Services Ltd. announced a bigger-than-expected 6 percent fall in net income. Infosys posted net income of 34.8 billion rupees ($540 million) in the three months ended June, compared with the 34.3 billion rupee average of estimates compiled by Bloomberg. On a constant currency basis, it's sticking with a prediction for 6.5 to 8.5 percent revenue growth in fiscal 2018.
Researcher Gartner Inc. forecast that global IT spending will total $3.5 trillion in 2017, a 2.4 percent increase from last year.
Infosys' shares climbed more than 3 percent in early Mumbai trade, and the stock has fallen 3 percent this year as of Thursday's close.
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