Wipro (NYSE:WIT) held its first-quarter earnings conference call on Thursday. Below is the complete transcript from the call.

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Summary

Wipro Limited reported IT services revenue of $2.61 billion for Q1, marking a 0.9% year-on-year increase but a 1.2% sequential decline.

The company's operating margin was 16%, down 1.2% year-on-year, attributed to salary increases and ongoing AI investments.

Wipro secured $3.4 billion in order bookings, including 13 large deals worth $1.6 billion, highlighting strategic wins in healthcare and chemicals sectors.

Strategic initiatives include the acquisition of Mindsprid and the launch of AI Business and Platform unit, focusing on AI-powered industry platforms.

The company anticipates Q2 revenue growth in the range of -1.5% to +0.5% in constant currency terms, amid ongoing macroeconomic uncertainties.

Management emphasized the importance of AI in driving operational efficiency and client outcomes, with notable achievements in AI governance and AI-powered solutions.

Full Transcript

Nisha Chandrasekharan (Moderator)

Welcome everyone to Wipro's first quarter earnings press conference. For those of us who are joining virtually. Good morning, good afternoon, good evening. My name is Nisha Chandrasekharan and I will be your moderator for today. Joining me on stage is our Chief Financial Officer Aparna Iyer, our Chief Executive Officer and Managing Director Srini Pallia and our Chief Human Resources Officer Saurabh Koval. We will begin with opening remarks from our CEO followed by a financial review from our CFO.

Post that we'll open the floor for your questions. With that, let me invite our CEO and Managing Director Srini Pallia.

Srini Pallia, CEO and Managing Director

Good evening everyone. I see a lot of familiar faces. Thank you for joining us today. Let me start with a quick view of the broader market that we see and I'm sure you're also following what's going on in the market. The macro environment remains resilient. But of course there are uncertainties which continue to shape decision making for our clients. Technology investments however, has not slowed. They have become more focused. Our clients continue to invest in AI data, cloud modernization, cyber security and also productivity led transformation.

At an organization level, spending today is measured with more rigor and longer decision cycles. The AI disruption is expanding the market but not shrinking it. But at the same time, conversations around AI are becoming very intense. You all heard about the tokenization. As that landscape evolves, clients are focused on net productivity and require a tighter linkage between their investments and their outcomes. Despite selective client spending, our pipeline remains healthy.

We continue to see strong engagement across our markets and industries. We continue to execute and a consulting led AI powered strategy to help our clients reimagine and redesign their enterprise around intelligence. With that I will now share our financial performance. All numbers are in constant currency. Our IT services revenue for quarter one was $2.61 billion up 0.9% year on year and down 1.2% sequentially. Our IT services margin was 16.0%, a 1.2% decline year on year.

Just to give you some color on our markets, Americas for us remained soft, declining both sequentially and on year on year basis. However, we continue to see momentum in technology and communication and we have seen some good wins in the consumer segment. And as we move into the quarter too, we are definitely seeing momentum build up in BFSI sector. In Americas our APIAs revenue grew sequentially and also on a year on year basis. Here we are encouraged by the momentum we continue to see in this market, particularly in the PFSI and consumer sectors.

Europe grew year on year with strong traction in BFSI technology and communication. However, energy, manufacturing and resources sector remained soft. We see healthy pipeline across various regions in Europe. If I were to call out two it would be UK and Nordics. During our quarter, one order booked totaled $3.4 billion and our large deal booking totaled $1.6 billion. This order booking include 13 large deals this quarter. I want to take a minute to highlight two of these deal wins which are very different from the way we have been seeing the deals that we have been structuring and solutioning for our clients. 1. A leading global animal healthcare provider selected us to modernize and manage their digital operations across global network of hospitals and clinics using Wipro Intelligence. I repeat, using WIPRO Intelligence we will help transform service operations, improve productivity and enable predictive issue prevention. We are helping this client create a more autonomous technology environment and the goal here is to improve experiences for their clinical teams, for their employees and of course customers who walk in with their pets, while increasing operational rigor.

In our second deal, win, a leading European specialty chemicals company chose us to run and transform their complex application landscape, leveraging AI LED capabilities. Through our wings, which is actually part of our Wipro Intelligence, we will operate, automate our operations for the client, improve delivery efficiency, provide greater visibility through an AI powered digital command center. The outcome is expected to elevate service quality, higher productivity and lower operating costs.

The reason I'm calling out these examples is that they reflect a broader shift in the enterprise priorities. Increasingly today our Clients are looking beyond technology modernization alone. The focus clearly is moving towards AI enabled operating models that improve service quality, reduce operational complexity and strengthen resilience and of course unlock sustainable productivity gains. And I can assure you this is where Wipro is well positioned.

Let me now share a few additional updates. During the quarter we closed the acquisition of Mindsprid and quickly transitioned from integration planning to execution. While we continue to deepen our relationship with OLAM Group, we have also started to see good opportunities in the food and agriculture sector. If you recollect last quarter we launched AI Business and Platform unit. Since then we have moved decisively from strategy to execution. We are building multi AI powered industry platforms, developing new AI native business models and forging strong partnerships across our AI ecosystems.

We have led the foundation, strengthen the team with specialized AI native leadership talent, defined our roadmap to establish clear priorities for the next phase of growth. You know, I want to actually take a moment here to highlight a few more areas where we are making progress and growing our AI momentum through Wipro Intelligence. You recently heard of our launch of Applied AI center of Excellence for CLAUDE models powered by anthropic. This strengthens our ability to help clients rapidly adopt frontier AI capabilities while maintaining enterprise grade controls and governance.

Capco, our BFSI consulting arm, won the AI Governance and Risk Excellence award at the OpenAI Partner Summit. Of course we had to compete with a lot of our competitors there and our UK AI lab won the OpenAI Codex hackathon for an AI powered banking solution. These accolades validate our ability to innovate while applying AI responsibly in highly regulated industries. Across markets and industries, we are helping clients reimagine operations by embedding AI at the core of their business spanning both physical and digital worlds.

So I'm excited to share some examples of work we have already done for some of our clients. 1. For a global industrial manufacturer, we are reimagining finance and procurement through our wings platform, combining agentic AI intelligent orchestration, real time analytics and AI powered knowledge management to create a highly automated operating model. Second, with one of our healthcare clients we are deploying multi agent AI system reducing provider enrollment processing up to 70%.

It has really improved while automating their manual effort up to 90%. 3. For a leading global technology company, we are improving the quality, reasoning and safety of their next generation AI models through expert led data creation and AI evaluations. In fact, this is delivering significant gains in model accuracy which is very important and reasoning capability which is very important in the new context of AI and last one with a life sciences client.

Our Wings platform is transforming pharmacovigilance from a document centric labor intensive process into a completely AI native safety operations. This is powered by our autonomous agents and regulatory grade workflows which we develop through AI and Wipro Intelligence. In fact, one more I'll take for a global energy leader, this is very interesting. We are defining their enterprise robotic strategy and roadmap for physical AI enabled autonomous operations.

So you can see that you have physical AI now coming into the into action. Collectively these engagements demonstrate our breadth of Wipro's AI capabilities from a strategy and advisory to being clearly a domain specific solutions company. It also reinforces our role as a trusted transformation partner in helping enterprises redesign how we work gets done. In fact, we have more such examples of the AI work we have done. It's available in our press release if it's a good reading for you while you're heading back home today.

With that, let me shift focus to the next quarter. In Q2 we are guiding for a sequential growth of minus 1.5% to plus 0.5% in constant currency terms as we continue to navigate macro uncertainty and of course geopolitical instability. Our priority is to remain disciplined in execution, helping clients navigate complexity and create sustainable value for all our stakeholders. With that, let me hand it over to Aparna to share our financial performance in more detail over to you.

Thank you very much.

Aparna Iyer, Chief Financial Officer

Thank you Srini. Good evening ladies and gentlemen and thank you for joining us. Let me share an update on the financial performance for the quarter ended 30 June 2026. After that we will open the floor up for questions and answers. Our IT Services revenue for Q1 grew 0.9% year on year in constant currency terms. Revenue declined 1.2% sequentially in constant currency terms and 1.4% in reported currency terms. This was well within our guided range.

Our operating margins for the quarter was 16%. The margins declined 1.2% on a year on year basis. This was due to the incremental impact of the salary increase. You will note we gave a salary increase effective first March 2026 and we've had two incremental months of impact in Q1. We also had some of our large deals that we had won earlier ramp up and we have several ongoing investments in AI. All of these were partially offset by rupee depreciation, benefits and other operational efficiencies that we drove.

We remain focused on returning back to our previously stated narrow band over the next few quarters, net Income for the quarter was 33.6 billion and EPS for the quarter was rupees 3.2. Both grew 0.6% on a year on year basis. Moving on to some specific color on SMU and sector performance, all growth numbers that I will share will be on constant currency terms. Americas 1 was flattish year on year basis and declined 2.3% sequentially. America's 2 declined 7.3% on a year on year basis and 2.5% decline on a quarter on quarter basis.

Europe grew 6% on a year on year basis while declining 0.9% sequentially. Apnea grew 13.5% year on year while growing 4.4% sequentially on sectors. BFSI grew 2.6% on a year on year basis while declining 1.2% sequentially. Consumer grew 0.7% sequentially and 1.9% on a year on year basis. Technology and communications grew 0.2% sequentially and 10.8% on a year on year basis. Health declined 3% year on year and declined 2.6% sequentially. Energy, manufacturing and resources declined 3.6% sequentially and 8.9% year on year.

I will share some quick update on some key financial metrics. Our operating cash flows was at 98% of net income for Q1. Our gross cash is at $4.3 billion as of 30 June 2026. Accounting yields remained stable at 7.2% for the quarter. RETR was 22.6% for Q1 versus 21.6 in the same quarter last year. In terms of guidance, I would like to reiterate what was shared by Srini. We expect revenues in our IT services segment to be in the range of 2.0.

Disclaimer: This transcript is provided for informational purposes only. While we strive for accuracy, there may be errors or omissions in this automated transcription. For official company statements and financial information, please refer to the company's SEC filings and official press releases. Corporate participants' and analysts' statements reflect their views as of the date of this call and are subject to change without notice.