Wipro Q3 Earnings Call Highlights

16 Jan 2026, 15:20 by Tristan Rich · The Markets Daily

Wipro (NYSE:WIT) reported sequential growth in its third quarter of fiscal 2026 as management pointed to a client environment increasingly shaped by artificial intelligence priorities and continued focus on cost optimization. On the company’s earnings call, Chief Executive Officer and Managing Director Srinivas Pallia said AI has become a “standing board-level mandate” at many organizations, influencing how clients plan and invest, while traditional themes such as vendor consolidation and cost takeout remain central to decision-making.

Q3 revenue trends and bookings

Wipro’s IT services revenue was $2.64 billion for the quarter, with sequential revenue up 1.4% in constant currency terms. Excluding the Harman DTS acquisition, sequential revenue grew 0.6% in constant currency, management said. The quarter’s growth was described as broad-based, with sequential gains across three of four markets and four of five sectors.

The company closed $3.3 billion in total contract value (TCV) during the quarter, including $871 million in large deal bookings. Pallia highlighted two large, multi-year deals tied to the company’s “Wipro Intelligence” approach: one with a UK-based global education provider to build a “single, secure, intelligent operating model,” and another with a US-based fitness technology company aimed at supporting a shift to a subscription-based wellness model and global expansion. Management said the engagements illustrate a trend of clients involving Wipro earlier in transformation programs.

Margins, profitability, and one-time charges

Chief Financial Officer Aparna Iyer said operating margin for the quarter was 17.6%, expanding 40 basis points versus the adjusted operating margin in Q2 and improving 10 basis points year-over-year. She described it as “one of our best margin performances in the last several quarters.”

Adjusted net income was INR 33.6 billion and adjusted EPS was INR 3.21, up 3.5% quarter-over-quarter and flat year-over-year. Operating cash flows were 135% of net income, and gross cash (including investments) totaled $6.5 billion.

Iyer also called out two one-off charges that impacted net income but were not included in IT services segment margins:

An increase of INR 302 crores toward gratuity expenses due to implementation of a new labor code.
INR 263 crores tied to a restructuring exercise completed during the quarter.

Iyer said the restructuring is now complete and the company does not anticipate further charges.

Regional and sector performance

In constant currency terms, Iyer reported that Americas 1 grew 1.8% sequentially and 2.8% year-over-year, while Americas 2 declined 0.8% sequentially and 5.2% year-over-year. Europe grew 3.3% sequentially but declined 4.6% year-over-year, and APMEA increased 1.7% sequentially and 6.6% year-over-year. Pallia said Europe’s sequential growth was supported by a ramp-up of an earlier announced mega deal, while APMEA was led by India, the Middle East, and Southeast Asia.

By sector, Iyer said BFSI grew 2.6% sequentially and 0.4% year-over-year, health grew 4.2% sequentially and 1% year-over-year, and communications rose 4.2% sequentially and 3.5% year-over-year. Consumer grew 0.7% sequentially but declined 5.7% year-over-year. Energy, manufacturing, and resources (EMR) declined 4.9% sequentially and 5.8% year-over-year.

On EMR, Pallia said results were impacted by macroeconomic uncertainty, including tariff-related factors and supply chain disruption. However, he said the pipeline remains strong and is largely centered on vendor consolidation and cost takeout, with “good momentum” in energy in the Americas and Europe and manufacturing momentum in Europe. He also noted Capco traction in energy consulting.

On the consumer sector, Pallia said tariff effects have weighed on performance and reiterated that a large SAP program placed on hold last year has not been restarted, affecting year-over-year results. He described current consumer trends as mixed, while noting some earlier wins are “slowly ramping up.”

Harman DTS integration, Q4 outlook, and capital return

Management said the Harman DTS acquisition, which closed in Q3, contributed 0.8% to constant currency growth. Pallia said the deal adds engineering and AI capabilities that strengthen Wipro’s engineering global business line and expands reach into new regions and industries, enabling the company to pursue larger and more complex programs. In response to a question on where Harman DTS may boost win rates, Pallia pointed to tech and communications as the “sweet spot,” while also citing opportunities across health, consumer, and EMR.

For Q4, Wipro guided to IT services revenue of $2.635 billion to $2.688 billion, implying sequential growth of 0% to 2% in constant currency. Management said guidance includes an incremental two months of Harman DTS revenue and reflects fewer working days and delayed ramp-ups on certain large deals. Iyer said the company expects incremental margin dilution from Harman DTS in Q4, but the company’s “endeavor” is to keep margins in a similar band as recent quarters. She later referenced an effort to maintain margins in a 17% to 17.5% band, while noting wage decisions, large deal margin profiles, and growth investments as moving parts.

On deal ramp-ups, Iyer said some large deals take multiple quarters to fully convert. She noted that a significant deal from Q4 of the prior fiscal year, referred to as “Phoenix,” is now fully ramped and reflected in Q3 results, while other wins will ramp through the next few quarters.

On compensation, CHRO Saurabh Govil said the company intends to decide on salary hikes “in the next few weeks,” with an intention to consider it in the current quarter.

The board declared an interim dividend of INR 6 per share. Iyer said total cash distributed to shareholders during the current financial year will exceed $1.3 billion and is expected to surpass the minimum threshold in Wipro’s capital allocation policy for the block ending fiscal 2026. Management also reiterated that buybacks remain an option for returning cash to shareholders, subject to board consideration.

About Wipro (NYSE:WIT)

Wipro Limited (NYSE: WIT) is an Indian multinational corporation that provides information technology, consulting and business process services. Headquartered in Bengaluru, India, the company traces its origins to 1945 when it was founded as Western India Vegetable Products and later diversified into technology and IT services. Today Wipro positions itself as a provider of enterprise IT solutions and digital transformation services for large and mid-sized organizations across multiple industries.