Infosys Technologies, India's second-largest IT outsourcer, reported a smaller than expected drop in its third quarter net profit Tuesday, and the company raised its outlook for 2010.
The results were seen as a sign of improving conditions for Indian technology companies, which were hit hard by the recession, and were supported by a Forrester Research report that predicted outsourcing could grow 7.1 percent globally in 2010.
"Global economic recovery seems to be led by the U.S. and the financial services," Infosys CEO S. Gopalakrishnan said in a statement. "Even though IT budgets are expected to be flat in 2010, offshore outsourcing is expected to benefit from this recovery."
Infosys said revenue for its fiscal third quarter, ending Dec. 31, rose 5.2 percent over the previous year to $1.2 billion. Profits were relatively flat, rising 0.6 percent to $334 million.
Based on improving economic signs, Infosys raised its outlook for its fiscal year ending March 31, 2010. It said revenues are now expected to be in the range of $4.75 billion to $4.76 billion, which would represent a 1.8 percent to 2 percent increase over the prior year.
Infosys highlighted a number of major projects it is involved in, although it did not name the clients. Among those cited:
It is building a patient appointment scheduling system for a provider of medical laboratory tests and services. The system will allow a patient to schedule an appointment at any of the company's 1,000-plus service centers.
It is working with a "high tech major" to set up a center of excellence, which will focus on quality assurance services for applications.
An automotive manufacturer engaged Infosys to implement a next-generation enterprise resource planning system in its distribution business.
A major telecom provider has contracted Infosys to build and manage its online portals.
After a year of flat to negative growth, Indian outsourcing companies are becoming more aggressive in their preparations to capitalize on a worldwide economic recovery. Infosys said it added 4,429 employees in the quarter, bringing its total staff numbers to 109,882 as of Dec. 31.
Infosys said 66.6 percent of its revenue in the quarter came from North America, 21.9 percent from Europe, 1.2 percent from India and 10.3 percent from the rest of the world. The North America figure was up from 62.3 percent a year ago.
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