Infosys share price jumped by 1 percent on Thursday before the results. But, as markets were closed on Friday, we can expect major impact of the results on Monday. Infosys share price could suffer as the company has issued weak future guidance. The uncertainty in global trade environment could impact IT companies the most. However, with better technologies coming up in the AI segment, many technology companies can also surprise investors. Infosys is currently close to its yearly lows and we can expect selling pressure on Monday.

Infosys Q4 Results Miss Estimates; Revenue Guidance Trimmed as Global Headwinds Persist

In its latest quarterly update, Infosys, India’s second-largest IT services exporter, delivered a mixed performance that underscored both resilience and caution amid a challenging macroeconomic climate. While fourth-quarter revenues rose modestly, the company issued a surprisingly conservative revenue growth forecast for FY26, citing persisting global uncertainties. Additionally, a decision to terminate over 500 underperforming trainees has drawn significant attention to its talent management approach. Despite the muted outlook, the board announced a final dividend of Rs 22 per share, signaling ongoing shareholder commitment even amid operational headwinds.

Strong YoY Growth, but Sequential Headwinds Persist

Infosys reported Rs 40,925 crore in revenue for Q4 FY25, marking an 8% year-on-year increase compared to Rs 37,923 crore in the same period last year. While the annual uptick reflects stability in its core operations, growth momentum remained subdued due to prolonged decision-making cycles and budget constraints in key global markets.

The results were published after Indian market hours on April 17. In response, Infosys shares on the NSE closed slightly higher at Rs 1,420.20, up from the previous close of Rs 1,413. However, Infosys ADRs (American Depository Receipts) fell over 4% post-announcement, closing at $15.68 from $16.58, highlighting investor disappointment with the guidance cut.

Revenue Forecast Trimmed Sharply for FY26

The most notable takeaway from the announcement was Infosys’ decision to slash its revenue growth projection for FY26 to 0–3%, significantly down from the 4.5–5% forecast given for FY25. This cautious stance was attributed to global economic headwinds, delayed client spending, and cautious enterprise IT budgets.

Management noted that while long-term demand for digital transformation and AI remains intact, near-term uncertainties are leading clients to adopt a wait-and-watch approach, especially in sectors like BFSI, telecom, and retail.

Dividend Payout Reinforces Shareholder Focus

Despite operational challenges, Infosys has maintained a strong commitment to capital returns. The board declared a final dividend of Rs 22 per share for FY25. The record date has been set for May 30, 2025, and dividend payments are scheduled for June 30, 2025.

This dividend announcement is consistent with Infosys’ established capital allocation policy and reflects continued confidence in its cash-generating capabilities, even in periods of slowing revenue expansion.

Internal Restructuring: 540 Trainees Terminated for Failing Assessments

In a move that sparked debate across the IT sector, Infosys terminated the contracts of 240 trainees in April after they failed to clear internal assessment tests. This follows a similar action earlier this year when 300 trainees were let go in February.

These individuals were part of the apprenticeship and foundation training programs and reportedly failed to qualify despite multiple chances, including mock tests, extended preparation time, and doubt-clearing sessions. The company emphasized the importance of maintaining a high performance threshold, especially in an increasingly competitive global IT landscape.

To mitigate the fallout, Infosys has provided a one-month severance payout and outplacement services in partnership with skill providers like NIIT and UpGrad. These include options such as a 12-week program for roles in the BPM industry and a four-week IT fundamentals course, reinforcing its commitment to responsible transition support.

Strategic and Operational Context

Despite the conservative revenue outlook, Infosys continues to focus on key strategic areas including generative AI, automation, and cloud migration. These are expected to become significant revenue contributors as enterprises gradually restart discretionary IT spends. However, the current quarter reflected slower-than-expected deal ramp-ups.

Operationally, Infosys is pursuing cost optimization and productivity initiatives, including tighter utilization models, re-skilling, and automation. These are critical to maintaining margin resilience in the face of weakening topline growth.

Investor Sentiment: Market Divided on Near-Term Outlook

The latest results have sparked mixed reactions across analyst circles:

Macquarie has retained a ‘Neutral’ stance, citing the company’s rich valuation relative to its lowered growth expectations.

Jefferies downgraded the stock to ‘Hold’, highlighting weak revenue visibility and margin concerns.

Kotak Institutional Equities maintained a ‘Buy’ recommendation, optimistic that delayed deal closures will begin materializing in H2FY26.

Investor confidence appears cautiously optimistic, with the stock trading at a forward P/E of approximately 21x FY26 earnings—moderately below its long-term average but above peers like Wipro and HCLTech.

Broader Implications for India’s IT Sector

Infosys’ cautious revenue outlook is a microcosm of larger issues facing the Indian IT industry. Export-driven tech firms are grappling with slowing global IT budgets, longer sales cycles, and margin compression due to talent costs and automation transitions.

The recent layoffs, although limited in scope, hint at a growing shift toward performance-based retention and higher productivity thresholds. This could set a precedent for similar talent management strategies across India’s top-tier IT firms.

Conclusion: Navigating Headwinds with Strategic Agility

Infosys’ fourth-quarter performance underscores a tale of duality—solid financials tempered by macroeconomic caution. With a strong dividend payout, moderate growth in core operations, and robust talent recalibration initiatives, the company is positioning itself to weather a turbulent FY26.

However, the lowered revenue guidance, trainee exits, and subdued global tech spending reflect real and immediate challenges. Investors and stakeholders will closely monitor how Infosys leverages its innovation engine and execution capabilities in the quarters ahead to restore confidence and reinvigorate growth.

As it stands, Infosys remains a bellwether not just for India’s IT sector—but for the global services economy’s post-pandemic recalibration.