Wipro Limited disclosed its third‑quarter 2025‑26 results on January 16, 2026, reporting total revenue of $2.635 billion, a 1.4% quarter‑over‑quarter rise in constant‑currency IT services revenue and a 1.2% year‑over‑year decline. Net income fell 7.0% YoY to ₹31.2 billion, while adjusted earnings per share of ₹3.21 ($0.04) matched consensus estimates, reflecting disciplined cost management and a favorable mix shift toward higher‑margin AI‑enabled services.
Revenue growth was driven by a 1.4% QoQ increase in IT services revenue, but the company’s overall revenue slipped 1.2% YoY. The decline was largely attributable to a 5.7% year‑over‑year drop in total deal bookings, with large deals (≥$30 million) down 8% to $871 million. A one‑time impact of ₹302.8 crore from new Indian labor codes further weighed on net income, while the company’s focus on AI‑driven solutions helped offset some of the top‑line softness.
Operating margin expanded to 17.6%, up 0.9 percentage points from the prior quarter, marking the best margin performance in several years. The lift was driven by higher utilization, SG&A optimization, and a shift toward higher‑margin AI and digital services. Operating cash flow reached 135.4% of net income, underscoring strong liquidity generation and efficient working‑capital management.
Management guided for Q4 FY26 IT services revenue of $2.635 billion to $2.688 billion, a 0%‑2.0% sequential increase, and maintained its margin outlook, signaling confidence in sustaining profitability amid a cautious macro environment. The guidance also reflects expectations of incremental margin dilution from the Harman DTS acquisition in Q4, while the company continues to invest in its AI platform, Wipro Intelligence, to capture new growth opportunities.
Market reaction to the results was mixed: U.S. ADRs fell nearly 6% after the announcement, driven by concerns over the 7% YoY decline in net profit, the slowdown in deal activity, and the cautious revenue guidance. Investors weighed the positive margin expansion and strong cash generation against the top‑line softness and headwinds from client spending cycles.
"In Q3, we delivered broad‑based growth in line with our expectations," said CEO Srini Pallia. "Our AI‑enabled platforms, including WINGS and WEGA, contributed to several wins and are becoming a key differentiator. We remain focused on execution rigor and cost discipline, which has helped us expand operating margin and generate robust cash flow," added CFO Aparna Iyer.
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