Wipro shares declined 2.5% on Friday after the company reported a marginal net profit of ₹3,325 crore for the June quarter, missing analyst estimates. The IT major’s subdued revenue growth guidance of -1.5% to +0.5% for the September quarter further dampened investor sentiment amid ongoing challenges in discretionary IT spending.
Wipro shares faced significant selling pressure on Friday, closing down nearly 2.5% after the company’s first-quarter financial results for FY27 fell short of market expectations. The stock, which opened at ₹173.55, struggled as investors reacted to stagnant profit growth and a cautious outlook for the coming months.
Weak Q1 Results and Profit Pressure
For the quarter ended June 2026, Wipro reported a net profit of ₹3,325 crore, reflecting a marginal year-on-year increase of less than one percent. On a sequential basis, the profit actually fell by 4.7%. While total revenue grew 10.6% to ₹24,480 crore, the growth in the core IT services segment remained sluggish at just 1% year-on-year. These figures missed the projections set by market analysts, who had anticipated a net profit of ₹3,460 crore on revenue of ₹24,737 crore.
The decline in performance was linked to several factors, including wage hikes, the costs associated with ramping up new large deals, and ongoing investments in artificial intelligence. These expenses pushed the company’s operating margins below street estimates. Analysts noted that these costs, combined with a difficult demand environment where clients are prioritizing cost optimization over new projects, have put consistent pressure on profitability.
Subdued Outlook for Q2
The company’s guidance for the September quarter provided little relief to investors. Wipro expects IT services revenue to fall between -1.5% and +0.5% sequentially, reaching an estimated $2,574 million to $2,627 million. This forecast suggests that the company is bracing for a continued period of slow growth. While there are signs of improved traction in sectors like BFSI (Banking, Financial Services, and Insurance) and regions like Europe, the conversion of large deals into actual revenue has been slower than expected, with some deal closures being deferred.
Market and Brokerage Reaction
Brokerage firms have expressed concern over the lack of a clear recovery path. Equirus Securities maintained a 'Reduce' rating, citing the disappointing guidance and the miss on margins. Similarly, Motilal Oswal Financial Services kept a 'Neutral' stance, noting that Wipro may struggle to keep pace with industry peers throughout FY27, with the potential for flat or slightly negative growth. Antique Stock Broking also maintained a 'Hold' rating, pointing to a decline in total booking volumes compared to recent averages.
Investors will likely track the company’s ability to improve its conversion rate of large deals and manage its margin pressure in the upcoming quarters. The key monitorable remains whether Wipro can accelerate project ramp-ups and show sustained revenue growth in the face of continued selective discretionary spending by global clients.