Bengaluru-based IT services giant Wipro Limited announced its financial results for the third quarter of FY2025-26 (October-December 2025) on January 16, 2026, delivering a mixed performance. The company reported consolidated revenue from operations of Rs 23,556 crore, marking a 3.8% sequential increase from Rs 22,697 crore in the previous quarter and aligning closely with market expectations. On the profitability front, however, Wipro faced headwinds. Consolidated net profit attributable to equity holders stood at Rs 3,119 crore, reflecting a 7% year-on-year decline and a sequential drop as well. The dip was largely attributed to the implementation of new labor codes, which increased employee-related costs. Adjusted for these labor code impacts, the net income was higher at approximately Rs 3,360 crore, showing a modest uptick in underlying performance.

Operating metrics also reflected pressure, with EBIT (Earnings Before Interest and Taxes) declining 5.1% sequentially to Rs 3,491 crore. This led to a contraction in operating margin to 14.8%, down from 16.2% in the prior quarter (a drop of about 140 basis points). Analysts noted that unlike some peers in the IT sector, Wipro absorbed the additional employee costs directly into its expenses, contributing to the sharper margin compression.

Despite the profitability challenges, positive highlights emerged on the growth and deal front. Total contract value (TCV) of deal wins reached $3.3 billion, described as healthy and in line with estimates. In constant currency (CC) terms, IT services revenue grew by 1.4% sequentially — outperforming the expected range of 0.5-0.6% — while reported CC growth stood at 1.2%. Attrition remained stable at 14.2%, and net utilization held steady at around 83%, with the total headcount at approximately 244,000.

In a key positive signal for investors, Wipro's management provided an improved guidance for the next quarter (January-March 2026), projecting constant currency revenue growth of 0% to 2%. This marks an upgrade from the previous quarter's range of -0.5% to +1.5%, shifting from slightly negative momentum to a more optimistic outlook. The guidance aligned with broker expectations and mirrored positive revisions seen in peers like Infosys.

Adding to shareholder returns, the company's board approved an interim dividend of Rs 6 per share, with January 27, 2026, set as the record date. This move conveys confidence in cash flows despite margin pressures, though the broader IT sector remains cautious amid ongoing client spending trends. On the emerging AI revenue front, detailed updates were limited, with more clarity expected from management commentary.