Wipro(US:WIT)2023-01-13 18:59Financial Data and Key Metrics Changes - The company reported a year-on-year revenue growth of 10.4% in Q3 FY '23, with a sequential growth of 0.6% in constant currency terms [16] - Operating margin expanded by 120 basis points to 16.3% compared to the previous quarter [16][34] - Cash conversion rate was robust at 143% of net income [18][34] Business Line Data and Key Metrics Changes - The iDEAS Global Business Line grew 12% year-on-year, driven by Cloud Transformation (27% growth), Applications and Data (18% growth), and Digital Experience (16% growth) [23] - The iCORE Global Business Line grew 8% year-on-year, with Cyber Security leading at 16% growth [24] - FullStride Cloud Services contributed over one-third of total revenues, indicating strong growth in this area [26] Market Data and Key Metrics Changes - The Americas One business grew 11% year-on-year, with Communication, Media, and Information Services growing at 14% [18] - Europe delivered a year-on-year growth of 12%, with almost all markets in Europe showing double-digit growth [20] - The APMEA region grew 7% year-on-year, with Southeast Asia and the Middle East performing particularly well [21] Company Strategy and Development Direction - The company is focused on value-driven transformation and cloud services, with a strong emphasis on client relationships and innovative solutions [9][12] - The strategy includes expanding market share through vendor consolidation and service expansion with existing clients [12][22] - The company aims to maintain a strong pipeline of large deals, with a focus on long-term contracts in Cloud and Infrastructure Services [80] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the macroeconomic environment, noting robust tech spending despite uncertainties [9][34] - The company expects full-year revenue growth to be between 11.5% to 12% in constant currency terms [33] - Management acknowledged a modest slowdown in discretionary spending but remains confident in the pipeline and future growth [93] Other Important Information - The company achieved record order bookings of over $4.3 billion, with 11 large deals signed [8][10] - Attrition rates dropped to 21% on a trailing 12-month basis, indicating improved employee retention [29] - The company has doubled the number of women in senior leadership roles, reflecting a commitment to diversity [31] Q&A Session Summary Question: How should we look at the TCV number and its conversion to revenue? - Management acknowledged strong bookings but noted that the conversion to revenue may take time due to macroeconomic uncertainties and client decision-making processes [39][44] Question: What is the percentage of renewals in TCV? - Management indicated a healthy balance between new deals and renewals, with a good volume of both types contributing to growth [55] Question: How does the company view the profitability of deals coming through hyperscalers? - Management confirmed that partnerships with hyperscalers have significantly increased bookings and that the margin profile from these deals is favorable [59] Question: What are the dynamics affecting growth in Europe? - Management highlighted that Wipro has changed its approach in Europe, leading to improved performance and market share [66] Question: How does the company plan to address the correlation between TCV and growth? - Management explained that while TCV has grown, the conversion to revenue may not be immediate due to the nature of long-term contracts [80]