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Wipro Will Recover From ‘Slow Start’ To Year, CEO Vows

‘While we had a slow start to the year, we believe this is a strong pipeline of deals and the differentiated capabilities we have invested in will gain back momentum as we progress through the year,’ says Wipro CEO and Executive Director Abidali Neemuchwala.

Wipro saw a year-over-year increase in revenue in its first quarter driven by deals of $100 million or more and one deal for more than $75 million. The Bangalore, India-based solution provider, however, said that revenue was down from the previous quarter, which it attributed to “slow signings” and “slow growth” among customers.

“I would have felt more comfortable if we had a stronger start to the year,” CEO and Executive Director Abidali Neemuchwala told investors Wednesday morning. “However, our demand pipeline is strong. We’ve had some wins which have not translated into revenue because customers are not necessarily signing contracts and starting projects fast enough. So I would be a little more watchful at this point in the year compared to the beginning of the year.”

Wipro is well placed to capture the increasing spend in digital transformation, cloud and “various new age services,” Neemuchwala said, but some of the deals the company expected to have signed in the first quarter were signed in the second quarter. As a result, Wipro said it is watching the macro environment and its impact on its customers’ willingness to spend.

Wipro’s revenue for the first quarter ended June 30 was $2.1 billion, up 5.6 percent year over year, while net income came in at $346 million, increasing earnings per share by about 5 cents, or 12 percent year over year. This quarter’s revenue, however, was down from $2.16 billion last quarter. Wall Street responded by sending share prices down slightly, down a penny to $4.16 in Tuesday afternoon trading.

Neemuchwala did not mention and analysts did not ask about the cyberattack earlier in the year that targeted Wipro as well as other solution providers. The phishing attacks against Wipro captured dozens of company employees and more than 100 computer systems, according to KrebsOnSecurity.

One large retailer and Wipro customer told KrebsOnSecurity that the threat actors who broke into Wipro used their access to perpetrate gift card fraud at the retailer's stores. The source added that the attackers also searched its systems for specific phrases related to gift cards, as well as for clues about security systems the retailer was using, KrebsOnSecurity said.

In early April, KrebsOnSecurity reported that the threat actors responsible for launching an advanced phishing campaign against Wipro in March also went after the following global outsourcers, systems integrators and MSPs: Avanade, Capgemini, Cognizant, Infosys, PCM, Rackspace and Slalom.

In addition to the three deals closed this quarter, Neemuchwala highlighted dozens of other wins, including a multiyear deal to support a key business transformation program at a leading U.K.-based insurance company; a robotic process automation contract with a U.S. manufacturer; and a deal to use its artificial intelligence platform to transform the operations and passenger experience at a Canadian airport.

Wipro is now forecasting maximum growth of 2 percent for the following quarter.

“While we had a slow start to the year, we believe this is a strong pipeline of deals and the differentiated capabilities we have invested in will gain back momentum as we progress through the year,” Neemuchwala said.

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