New Delhi: Infosys Ltd on Monday struck a cautious note on the demand outlook, even as it underlined stability in its operating performance and deal pipeline during the December quarter, reflecting the uneven recovery in global technology spending.
In its post-earnings call with analysts, the company said clients across markets continue to focus on cost take-out, vendor consolidation and efficiency-led programmes, while discretionary technology spends remain tightly controlled .
Management said revenue performance in Q3 FY26 was supported by steady execution in core digital, cloud and AI-led transformation programmes, alongside healthy traction in large deals. However, decision-making cycles remain elongated, particularly in discretionary projects, amid macro uncertainty and geopolitical risks .
Infosys reiterated its FY26 revenue growth guidance, indicating confidence in its order book and execution capabilities, even as it acknowledged that growth is likely to be back-ended and uneven across quarters. Operating margins remained resilient, helped by utilisation improvement, cost controls and easing attrition, which the company said provided headroom to invest in strategic priorities such as AI, generative platforms and talent transformation .
The company highlighted continued momentum in large deal wins during the quarter, with a balanced mix of cost optimisation and transformation-led contracts. “Clients are looking for partners who can help them drive productivity, simplify operations and deploy AI at scale,” the management said, adding that Infosys’ investments in generative AI platforms and industry cloud offerings are beginning to see traction in client conversations .
On hiring and talent, Infosys said attrition has moderated further, enabling the firm to calibrate fresher onboarding and lateral hiring in line with demand. Wage costs remain largely under control, while productivity initiatives are supporting margin stability, the company said .
Geographically, demand trends remained mixed, with some signs of stabilisation in North America, while Europe continued to see pressure from macroeconomic uncertainty. Financial services and retail remained cautious, while manufacturing and energy showed relatively better resilience, according to management commentary .
Looking ahead, Infosys said it remains focused on strengthening client relevance through AI-led transformation, deepening large-account relationships and maintaining operational discipline. While near-term visibility remains limited, the company expressed confidence in its medium-term positioning as enterprises accelerate digital and automation-led transformation once macro headwinds ease .