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Infosys (NSE:INFY) Limited (NYSE:INFY) released its Q1 FY2026 financial presentation on July 23, 2025, revealing steady growth momentum with 3.8% year-over-year revenue growth in constant currency terms. The Indian IT services giant secured $3.8 billion in large deals during the quarter, with 55% representing net new business, signaling continued client confidence in the company’s service offerings.
Quarterly Performance Highlights
The Q1 results show Infosys maintaining stable performance with revenues reaching $4,941 million, representing 4.8% year-over-year growth in reported terms and 3.8% in constant currency. Quarter-over-quarter growth came in at 4.5% reported and 2.6% in constant currency terms. The company achieved an operating margin of 20.8%, remaining within its previously guided range of 20-22%.
"Our Q1 performance demonstrates Infosys’ resilience in a dynamic market environment," the company stated in its presentation. "The strong large deal momentum and growth across key verticals position us well for the remainder of fiscal 2026."
Net profit before non-controlling interests reached $809 million, with basic earnings per share (EPS) of $0.20, representing an 8.6% year-over-year increase. Free cash flow generation remained robust at $884 million for the quarter.
As shown in the following comprehensive financial highlights:
Segment and Geographic Performance
Manufacturing emerged as the standout performer among business segments, recording 14.8% year-over-year growth and now constituting 16.1% of total revenues. Financial services, Infosys’ largest vertical at 27.9% of revenue, showed more modest growth. Energy, Utilities, Resources & Services (13.6% of revenue) and Retail (13.4%) continue to be significant contributors to the company’s business mix.
The detailed breakdown of revenue by business segments provides insight into Infosys’ diversified portfolio:
From a geographic perspective, Europe led growth with an impressive 16.2% year-over-year increase, now accounting for 31.5% of total revenues. North America remains Infosys’ largest market at 56.5% of revenues, while Rest of the World (9.1%) and India (2.9%) make up the remainder of the geographic distribution.
This geographic performance aligns with trends observed in the previous quarter, where the company had noted strong European performance despite some softness in the automotive sector.
The geographic revenue breakdown illustrates the company’s global footprint and regional growth patterns:
Client Metrics and Workforce Management
Infosys reported 1,861 active clients as of June 30, 2025, adding 93 new clients during the quarter. The company continues to deepen relationships with existing clients, with 1,011 million-dollar clients and 41 clients contributing over $100 million in revenue each. Client concentration remains moderate, with the top 5 clients accounting for 13.2% of revenue and the top 25 clients representing 35.2%.
On the workforce front, Infosys reported a total headcount of 323,788 employees, with software professionals comprising 306,706 of that total. The voluntary attrition rate for IT services stood at 14.4% on a last twelve months (LTM) basis, while women employees constitute 39.1% of the workforce.
The company maintained healthy utilization rates at 85.2% excluding trainees and 82.7% including trainees, indicating efficient workforce management.
The following employee metrics provide further insight into Infosys’ operational efficiency:
Financial Position and Cash Flow
Infosys maintained a strong balance sheet with consolidated cash and investments of $5,271 million (₹45,204 crore) as of June 30, 2025. Free cash flow for the quarter stood at $884 million (₹7,533 crore), demonstrating the company’s continued ability to generate substantial cash from operations.
The company’s consolidated statement of comprehensive income reveals a gross profit of $1,525 million and an operating profit of $1,028 million, translating to a consistent operating margin of 20.8%.
The detailed financial statement provides a comprehensive view of Infosys’ quarterly performance:
Comparative Analysis with Previous Quarters
The Q1 FY2026 results build upon the momentum seen in previous quarters. In its Q2 FY2025 earnings call, Infosys had raised its revenue growth guidance to 3.75-4.5% in constant currency for FY2025, and the current quarter’s performance of 3.8% YoY growth aligns with those projections.
The large deal total value of $3.8 billion in Q1 FY2026 represents a significant improvement from the $2.4 billion reported in Q2 FY2025, suggesting accelerating client engagement. The operating margin of 20.8% remains within the previously guided range of 20-22%, indicating disciplined execution despite ongoing investments in workforce and technology capabilities.
Manufacturing continues to be a growth driver, maintaining the double-digit growth trajectory highlighted in previous earnings. Similarly, the strong performance in Europe aligns with regional trends observed in prior quarters.
Infosys stock (NYSE:INFY) was trading at $18.45 in premarket trading on July 23, 2025, up 1.04% from the previous close of $18.26. The stock has been trading near its 52-week high of $23.63, reflecting investor confidence in the company’s steady performance and growth outlook.
The company’s focus on generative AI initiatives, highlighted in previous communications as a strategic priority, appears to be yielding results in terms of deal wins and operational efficiencies, though specific metrics on AI adoption were not detailed in the Q1 presentation.
Full presentation:
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