Wipro's revenue slips, margins tighten as AI investments bite
IT services revenue fell 1.2% sequentially to $2.61B. Margin contracted 120 bps to 16%. Q2 guidance hints at continued weakness.
— 5 earlier stories on Wipro Ltd. →What's new
- Revenue fell 1.2% QoQ to $2.61B, margins contracted 120 bps to 16%.
- Q2 guidance: constant-currency growth of -1.5% to +0.5%.
- Large deal bookings at $1.6B, but pricing pressure in traditional IT work.
Why this matters
Wipro is investing in AI and ramping large deals, but the payoff is deferred. With margins at 16% and no timeline for the 17-17.5% target, earnings per share is under pressure.
What we're watching
- Whether margin recovery materialises by H2 FY27.
- Impact of intense pricing pressure on traditional IT services.
- Closure of deferred large deals in Q2.
The full read
Wipro's Q1 FY27 earnings call added texture to known results: 1.2% sequential revenue decline to $2.61B, margins contracting 120 bps to 16%, and Q2 guidance of -1.5% to +0.5% constant-currency growth. CEO Srini Pali cited wage hikes, upfront deal costs, and AI-native unit investments as margin drags. Large deal bookings stood at $1.6B across 13 deals, up 12.9% sequentially, but some closures slipped to Q2. Sector divergence was stark — healthcare and EMR weakened, technology and APMEA grew. Management declined a timeline for returning to the 17-17.5% margin band. The story remains unchanged: Wipro is spending to grow, but the margin payoff is deferred.
Questions answered
- What drove the margin contraction in Q1?
- Wage hikes, upfront costs from ramping large deals, and investments in the new AI-native business unit together squeezed margins by 120 bps to 16%.
- What is Wipro's Q2 revenue guidance?
- IT services revenue is guided at $2.574B to $2.627B, implying constant-currency growth of -1.5% to +0.5%.
- How did sector performance vary?
- Healthcare and EMR verticals weakened sharply, while technology, communications, and APMEA region delivered strong growth.
- What is the status of large deal bookings?
- Large deal bookings stood at $1.6B across 13 deals, with some closures deferred; management flagged intense pricing pressure in traditional IT work.
Wipro Ltd.
Latest quarter · Jun 2026
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All notes on WIPRO →- 16 Jul 2026 · 8:33 PM IST Wipro's revenue slips, margins tighten as AI investments bite
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