By Haripriya Suresh
(Reuters) -Indian IT services exporter LTIMindtree reported first quarter revenue just below estimates on Thursday, as cautious spending by clients slowed growth in its key North America market to the lowest in over a year.
Persistent inflation, weak demand and U.S. trade policy uncertainties are delaying non-essential tech projects, weighing on hopes of a rebound for India’s $283 billion IT sector.
Clients in the banking, financial services and insurance (BFSI) segment are curbing spending, but the company is focused on accounts with “high growth potential,” CEO Venugopal Lambu told analysts in a call.
Despite the macroeconomic uncertainties, LTIMindtree will see growth momentum across its industries and accounts in the next quarter, Lambu said.
LTIMindtree’s revenue from its North America market, which makes up 75% of the total pie, grew 4.2%, the slowest pace since the fourth quarter of fiscal 2024.
Revenue from the European market grew 7%, the best performance in seven quarters.
The company’s consolidated revenue for the quarter ending June rose 7.6% year-on-year to 98.41 billion rupees ($1.14 billion), slightly below analysts’ average estimate of 98.51 billion rupees, according to estimates compiled by LSEG.
Net profit came in at 12.54 billion rupees, up 10.6% from a year ago and above analysts’ average estimate of 11.86 billion rupees.
Three of LTIMindtree’s five segments — BFSI, manufacturing, and consumer — grew in the June quarter. But revenue from its technology, media and communications, and healthcare segments fell 4.7% each.
Quarterly deal wins stood at $1.63 billion, flat sequentially, but up from $1.4 billion a year earlier. In May, the company secured its largest-ever deal: a $450 million contract with an unnamed global agribusiness firm.
The firm’s shares closed 2.5% lower ahead of the results on Thursday, and are down 7% so far this year.
($1 = 86.0650 Indian rupees)
(Reporting by Haripriya Suresh and Aleef Jahan; Editing by Chandini Monnappa and Sahal Muhammed)
