Infosys Posts Strong Revenue Growth but Profit Margins Contract
Infosys reported a 14% YoY revenue jump in Q1 FY27, but profit fell sequentially as net margins narrowed.
Infosys delivered robust year-on-year revenue growth of 14% for Q1 FY27. However, profit declined from the previous quarter, reflecting margin pressure in the latest period.
Infosys kicked off its new fiscal year with a mixed performance. While revenue growth remained robust, a sequential decline in profit highlights emerging pressure on profitability.
The digital services leader reported revenue of ₹48,211 crore for the quarter ended June 2026, a solid 14% increase from the same period last year. Profit after tax (PAT) also grew 12.3% year-on-year to ₹7,775 crore. However, compared to the strong March-ending quarter, the picture is less rosy. Revenue grew 3.9% sequentially, but profit fell 8.6%. This divergence squeezed the net profit margin down to 16.1% from 18.3% in Q4 FY26.
A look at the recent quarterly trajectory shows the volatility in profitability, even as the revenue line has climbed steadily.
Revenue (₹ Cr.)
Profit (₹ Cr.)
Net Profit Margin (%)
| Metric | CurrentQ1 FY27 | PreviousQ4 FY26 | Same quarter LYQ1 FY26 |
|---|---|---|---|
| Revenue (₹ Cr.) | 48,211YoY +14% | 46,402 | 42,279 |
| Profit (₹ Cr.) | 7,775YoY +12% | 8,509 | 6,924 |
| Net Profit Margin (%) | 16.1YoY -1.8% | 18.3 | 16.4 |
Key Points
- The trailing twelve-month (TTM) net profit margin stands at 16.4%, slightly above the latest quarter's level.
- The company maintains a pristine balance sheet with zero debt and a high interest coverage ratio of 97.1x.
- Over the past year, the stock has declined nearly 20%, and it currently trades at a P/E of 17.2, a discount to the IT industry average.
For Infosys, the immediate challenge is to translate its consistent top-line momentum back into stronger bottom-line performance.
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· INFY
(BSE)
ISIN: INE009A01021
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