Goldman Sachs: Early Signs of Demand Stabilization in India's IT Sector, But CY26 Visibility Remains Poor

The IT sector in India is showing early signs of demand stabilization, with all major firms reporting sequential revenue growth and deal activity suggesting positive momentum. However, visibility into CY26 remains poor due to cautious client spending, macroeconomic uncertainties, and the impact of AI-driven productivity gains. Operating margins have improved, and headcount additions have turned positive. The sector's revenue growth is expected to remain muted at around 1.1% YoY in FY26, improving to 5.4% in FY27.

Wipro Limited has announced its financial results for the quarter ended September 30, 2025, under International Financial Reporting Standards (IFRS). The company reported a gross revenue of ₹227.0 billion ($2,556.6 million), an increase of 2.5% quarter-over-quarter (QoQ) and 1.8% year-over-year (YoY). The IT services segment revenue stood at $2,604.3 million, with a 0.7% QoQ increase and a 2.1% YoY decrease. Non-GAAP constant currency IT Services segment revenue increased by 0.3% QoQ and decreased by 2.6% YoY.

Total bookings were at $4,688 million, down by 6.1% QoQ but up by 30.9% YoY in constant currency. Large deal bookings were at $2,853 million, an increase of 6.7% QoQ and 90.5% YoY in constant currency. The IT services operating margin for Q2’26 was 16.7%, impacted by a provision of ₹1,165 million ($13.1 million) due to a customer bankruptcy. Adjusted for this event, the IT Services Margin was 17.2%, a 0.1% QoQ contraction and 0.4% YoY expansion.

Net income for the quarter was ₹32.5 billion ($365.6 million), a decrease of 2.5% QoQ but an increase of 1.2% YoY. Earnings per share (EPS) for the quarter were ₹3.1 ($0.031), down 2.5% QoQ but up 1.0% YoY. Operating cash flows were ₹33.9 billion ($381.5 million), down 17.6% QoQ and 20.7% YoY, but at 103.8% of net income for the quarter.

Wipro's CEO, Srini Pallia, highlighted the company's revenue momentum and strategic focus on AI. The company's Chief Financial Officer, Aparna Iyer, noted the gradual return to growth and strong financial parameters. Voluntary attrition stood at 14.9% on a trailing 12-month basis.

For the quarter ending December 31, 2025, Wipro expects IT Services revenue to be between $2,591 million and $2,644 million, translating to a sequential guidance of (-)0.5% to (+)1.5% in constant currency terms, according to a Communications Today report.

Wipro secured several strategic deals in Q2’26, including a multi-year infrastructure modernization engagement with a leading European financial institution, and a multi-year engagement with a leading U.S. healthcare company to modernize health insurance platforms. Additionally, the company won deals with a European utility provider, a global technology leader, and a UK-based financial services group, among others.

Wipro was named a Leader in IDC MarketScape: Worldwide IT and Engineering Services for Software-Defined Vehicles 2025 Vendor, as noted in the Communications Today article.