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Call sheet · Q2'26

Infosys (INFY)

Q2'26 earnings call · held October 16, 2025 · compared with the Q1'26 call · management-credibility review
3/12
Disclosure score
3 high, 3 medium, 2 low flags
Financial quality
Bottom line
The sleeper story is management's complete evasion on H-1B visa dependency while claiming 'no disruption,' which suggests the exposure is material enough they can't disclose it without spooking investors. Yes, they beat and raised, but the guidance implies zero growth for H2, and they're already warning about seasonal weakness when IT services typically sees Q4 strength. The binding constraint isn't demand, it's their ability to deliver without H-1B workers, which explains rising subcon costs and the Egypt subsidiary scramble. Most revealing quote: 'What we will do in the future will be guided by how we work with our clients' on H-1B, which is code for 'we're reconsidering our entire delivery model.' My view changes if they provide actual H-1B numbers showing under 10% dependency or if Q3 shows sequential growth above 2%.

The 30-second version

  • The H-1B visa crisis is the sleeper: 'majority' of US workforce doesn't need sponsorship means minority still does, and management won't give numbers
  • Beat-and-raise looks good but guidance tightening from 1-3% to 2-3% with H2 seasonally weaker means zero sequential growth ahead
  • AI revenue disclosure conspicuously absent while peers quantify; 'as the right time comes, we will start to share' is code for numbers aren't impressive

What changed this quarter

MetricQ1'26Q2'26Change
Revenue Growth (CC)3.8% YoY2.9% YoY90 bps deceleration
Sequential Revenue Growth2.6%2.2%40 bps deceleration
Operating Margin20.8%21.0%+20 bps expansion
Large Deal TCV$3.8B$3.1B18% decline QoQ
Net New in Large Deals55%67%+1200 bps improvement
Net Headcount AdditionNot disclosed8,000Significant hiring surge
Fresher Hiring YTDNot disclosed12,000On track for 20k annual target
Voluntary Attrition14.4%Marginally lowerSlight improvement but YoY worse
FY26 Revenue Guidance1-3%2-3%Lower end raised, upper end cut
Operating Margin Guidance20-22%20-22%Unchanged

Accountability tracked

6 new promises made4 narrative shifts flagged6 prior promises scored
Inside the full report
The complete write-up covers the full promise ledger with kept/missed calls, disclosure-quality scoring, the metrics-vanished check, verification items, and the questions to ask next quarter.
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Scores, kept-promise rates, and flags on this site reflect the author's opinion, applying a stated methodology to statements management made on public earnings calls. Informational and educational purposes only - not investment advice, a recommendation, or an offer to buy or sell any security. Sources believed reliable but not guaranteed; the author may hold positions in the securities discussed.

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