Wipro Q1 FY22 financial results announcement

Wipro Limited (NYSE: WIT, BSE: 507685, NSE: WIPRO) today announced financial results under International Financial Reporting Standards (IFRS) for the Quarter ended June 30, 2021.

Highlights of the Results

Results for the Quarter ended June 30, 2021:

• Gross Revenue was ₹5 billion ($2.5 billion¹), an increase of 12.4% QoQ and 22.4% YoY
• IT Services Segment Revenue was at $2,414.5 million, an increase of 12.2% QoQ and 25.7% YoY
• Non-GAAP² constant currency IT Services Segment Revenue increased by 12.0% QoQ and 21.3% YoY
• IT Services Operating Margin³ for the quarter was at 18.8%, a decrease of 29 bps YoY
• Net Income for the quarter was ₹3 billion ($434.8 million¹), an increase of 35.2% YoY
• Earnings Per Share for the quarter was at ₹92 ($0.08¹), an increase of 41.0% YoY
• Operating Cash Flow was at ₹5 billion ($451.1 million¹), which is 103.7% of Net Income
• Our IT Services workforce crossed the milestone of 200K, closing headcount at 209,890
• In June 2021, we issued our first ever dollar denominated bond offering of $750 million with a 5-year tenor

 Performance for the quarter ended June 30, 2021

Thierry Delaporte, CEO and Managing Director said, “Despite the severe onslaught of the pandemic, we delivered our best-ever quarter, with secular growth across all SMUs, Sectors and GBLs. Our sequential revenue growth of 12.2% was well ahead of the top-end of our guidance range, both organically and with Capco. Though in the early days yet, I am pleased with the way we have collaborated with Capco to build our joint go-to-market offerings and strategy. We remain focused on deepening our customer relationships, investing in talent & capabilities for the future, and winning market share.”

Jatin Dalal, Chief Financial Officer said, “We delivered a robust growth in EPS of 41% YoY even as we continued to invest for growth. At 103.7% of our net income, our operating cash flows for the quarter remained healthy. I am also pleased to share that we have successfully issued our debut bond offering in the international markets for $750 million.”

Outlook for the quarter ending September 30, 2021

We expect Revenue from our IT Services business to be in the range of $2,535 million to $2,583 million*. This translates to a sequential growth of 5.0% to 7.0%.

Wipro signed an agreement to acquire Ampion on April 1, 2021, and we previously announced that it will be closed during Q1’22. However certain regulatory approvals are still pending and the transaction is now expected to be closed in Q2’22.

*Outlook is based on the following exchange rates: GBP/USD at 1.40, Euro/USD at 1.21, AUD/USD at 0.77, USD/INR at 73.79 and CAD/USD at 0.81

IT Services

Wipro continued its momentum in winning large deals with our customers as described below:

• Wipro has won a multi-year engagement with a leading US-based communication services provider to deliver end-to-end quality engineering (QE) services for their applications, accelerating software release velocity and improving QE maturity. Additionally, the customer has selected Wipro to support database operations in a managed services model. Wipro will drive migration to new age databases and enhance operational efficiencies through automation
• A US based oil field services company has awarded Wipro a strategic IT outsourcing contract to provide applications, infrastructure, & cybersecurity services. Wipro will also assist the customer in digital transformation projects including modernizing the IT operations, reducing IT operating cost, and improving IT services experience for end users to enable scalable services in a changing energy industry
• A European multinational pharmaceutical company has awarded Wipro a multi-million-dollar engagement to personalize end user services leveraging digital interventions to ensure superior consumer experience for their employees globally
• Wipro has won a large digital workplace contract from a US-based health insurance company to transform and manage their end user services globally to improve customer experience centered around a digital-first theme
• A leading multinational electric and gas utility provider has awarded Wipro a global strategic IT infrastructure contract. The engagement will enhance the customer’s digital transformation journey, leveraging integrated managed services andconsolidating multiple data centers to next-generation hosting services, through Wipro’s Boundaryless Enterprise solutions

Digital Services Highlights

We continue to see increasing traction in digital oriented and other strategic deals as illustrated below:

• A leading US-based distributor of plumbing supplies has selected Wipro to support its cloud transformation journey by embedding quality engineering in the development lifecycle encompassing CRM implementation, data migration, and legacy applications. Additionally, Wipro will provide managed services for Cloud ERP covering multiple business functions, resulting in improved business agility and enhancing customer experience across more than 1,400 store locations
• A global shipping and logistics company has engaged Wipro for the digital transformation and modernization of its integrated shipping portfolio. The engagement will make it easier for the end customers to integrate their services, while providing improved reliability and speed, thus enabling the client to compete in the global e-commerce market
• Wipro has won a strategic engagement with a leading US-based financial services company to accelerate their digital transformation journey by implementing an outcome-based high velocity software engineering model enabled by multi-skilled agile teams deployed globally
• A globally integrated energy company has selected Wipro’s crowdsourcing platform Topcoder to design their next-generation customer-centric experience for promotion and loyalty management. Topcoder’s on-demand community will help accelerate product development, applying experience design to enable scale and expansion of the digital product globally
• A leading US-based medical devices original equipment manufacturer (OEM) has selected Wipro to build and launch a global patient engagement platform encompassing their cardiac rhythm management portfolio of devices Analyst Recognition

• Wipro was positioned as a Leader in IDC MarketScape: Worldwide Supply Chain SAP Ecosystems Services 2021 Vendor Assessment (Doc #US47537120, Mar 2021)
• Wipro was positioned as a Leader in IDC MarketScape: Worldwide Smart Manufacturing Service Providers 2021 Vendor Assessment (Doc #EUR147689021, Jun 2021)
• Wipro was positioned as a Leader in IDC MarketScape: Worldwide Artificial Intelligence Services 2021 Vendor Assessment ( Doc #US46741921, May 2021)
• Wipro was recognized as a Leader in Everest Group’s IT Managed Security Services PEAK Matrix® Assessment 2021
• Wipro was recognized as a Leader and Star Performer in Everest Group’s Life Sciences Operations Services PEAK Matrix® Assessment 2021
• Wipro was positioned as a Leader in Everest Group’s Application and Digital Services in Banking PEAK Matrix® Assessment 2021
• Wipro was rated as a Leader in ISG Provider Lens™ ServiceNow Ecosystem Partners 2021: Implementation & Integration Services and Managed Services Providers – US
• Wipro was rated as a Leader in ISG Provider Lens™ Microsoft Ecosystem 2021: Managed Services for Azure, SAP on Azure, Dynamics 365 and Office 365 Modern Workplace – US
• Wipro ranks among the Top Service Providers in Customer Satisfaction Category in Whitelane & PA Consulting UK IT Outsourcing Study 2021

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IT Products

• IT Products Segment Revenue for the quarter was ₹3 billion ($17.6 million¹)
• IT Products Segment Results for the quarter was a loss of ₹1 billion ($0.7 million¹)

India business from State Run Enterprises (ISRE)

• India SRE Segment Revenue for the quarter was ₹9 billion ($26.1 million¹)
• India SRE Segment Results for the quarter was a profit of ₹5 billion ($6.4 million¹)

Please refer to the table on page 9 for reconciliation between IFRS IT Services Revenue and IT Services Revenue on a non-GAAP constant currency basis.