17 - 07 - 2026

AI transforms Wipro’s order book, not yet its earnings

Artificial intelligence is transforming Wipro’s order book, but not yet its earnings.

The company’s first-quarter results reflected that paradox. It secured $1.63 billion in large AI-led transformation deals. However, IT services revenue grew just 0.9 per cent year-on-year in constant currency. Net profit rose only 0.6 per cent to Rs 33.6 billion. Operating margins also narrowed, highlighting the slow conversion of AI demand into financial growth.

The quarter reflected a broader shift in the IT services industry. Companies are investing in AI to improve productivity and automate operations. At the same time, they remain cautious about overall technology spending. That is slowing revenue growth for IT vendors.

Wipro signed 13 large deals worth more than $30 million each. The contracts came from healthcare, insurance, chemicals, manufacturing, energy, retail and technology sectors. Most were centred on generative AI, agentic AI, intelligent automation and enterprise transformation.

AI beyond pilot phase

This shows AI has moved from pilot projects to mainstream business strategy. Yet the strong deal pipeline did not translate into stronger earnings.

IT services revenue fell 1.2 per cent sequentially in constant currency. Operating margin declined to 16 per cent from 17.2 per cent a year ago and 17.3 per cent in the previous quarter. The company said margins were affected by higher investments in AI capabilities, consulting talent and strategic growth areas.

The numbers also exposed a gap between bookings and revenue. Large deal bookings rose 12.9 per cent sequentially to $1.63 billion. However, total bookings fell 2.4 per cent. This suggests clients are spending on strategic AI programmes but remain cautious about expanding their overall technology budgets.

Unlike traditional outsourcing contracts, AI transformation programmes are implemented in phases. Revenue is recognised only as the work is delivered. As a result, large contract wins take longer to show up in revenue and profits.

Chief Executive Officer and Managing Director Srini Pallia said clients are moving beyond technology modernisation. They now want AI-enabled operating models that improve productivity, resilience and quality.

Chief Financial Officer Aparna Iyer said investments in people and strategic capabilities may create near-term margin pressure. However, they are necessary to support future growth. She said operating cash flow remained strong at Rs 32.9 billion, or 98 per cent of net profit. The board also declared an interim dividend of Rs 2 per share.

The company’s outlook remained cautious. Wipro expects IT services revenue in the September quarter to range between $2.57 billion and $2.63 billion. This implies sequential constant currency growth of between a decline of 1.5 per cent and growth of 0.5 per cent.

Employee attrition stood at 13.9 per cent over the trailing 12 months. This suggests hiring conditions have stabilised after the sharp churn seen in recent years.

The quarter highlights the challenge facing Wipro and the wider IT industry. AI is helping companies win bigger contracts. But those deals are not yet translating into faster revenue growth or stronger profits. The AI opportunity is growing. The financial payoff is taking longer to arrive.