India's Wipro unveils record buyback after slight quarterly revenue miss

BENGALURU, April 16 (Reuters) - India’s Wipro announced a record share buyback of up to 150 billion rupees ($1.61 billion) on Thursday after reporting a slight quarterly revenue miss, as clients held back tech spending in energy and banking sectors while business from key customer Estee Lauder slowed. 

 

Consolidated sales for India’s fourth-largest software firm in the three months ended March 31 rose 7.7% to 242.36 billion rupees ($2.60 billion), missing analysts’ average estimate of 243.63 billion rupees, according to data compiled by LSEG. 

 

Last week, the country’s top IT firm, Tata Consultancy Services, beat quarterly revenue and profit estimates, while allaying concerns about AI tools disrupting its core business.

 

French cosmetics major Estee Lauder roped in Accenture as an additional IT vendor in March, hurting its contribution to Wipro’s topline.

The dent to Wipro’s revenue was made larger as companies delayed tech spending due to the launch of artificial intelligence-based tools and the Middle East war that caused geopolitical and macroeconomic uncertainty. 

 

In February, the release of U.S. AI company Anthropic’s plugins, which could automate some finance and marketing functions, caused a global tech selloff on fears of disruption. 

 

The Bengaluru-based IT firm forecast revenue in the ongoing first quarter to grow in the range of 2% decline to a flat performance on a sequential basis, implying a range of $2.6 billion to $2.65 billion.    

 

Net profit fell 1.9% to 35.02 billion rupees for the quarter, marginally below analysts’ estimate of 35.07 billion rupees.

 

Three of the five verticals fell, led by energy’s 5.9% decline. Banking vertical, its largest, contributing to around third of its revenue, too fell 0.5%.

Wipro’s total deal wins came in at $3.5 billion, up from $3.33 billion - a six-quarter low - in the prior quarter and down from $4 billion a year earlier. 

During the quarter, it announced a deal with U.S.-insurance provider TruStage, but did not provide a deal value.

 

($1 = 93.2740 Indian rupees)

($1 = 93.2000 Indian rupees)

 

(Reporting by Sai Ishwarbharath B; Editing by Mrigank Dhaniwala and Harikrishnan Nair)