Infosys Reports 12 Percent Profit Decline in FY25 While Expanding AI Agent Development
Infosys sees attrition rise to 14.1 percent in Q4, with total headcount increasing to 323,578 employees.
Infosys announced a net profit of $814 million for the January–March quarter of FY25, marking an 11.7% decline from the $959 million reported in the same period last year. Despite the drop in profit, revenue grew 7.9% year-on-year to $4.7 billion, with total annual revenue reaching $19 billion (a marginal 3.9% growth).
AI Leadership and Client Demand
CEO Salil Parekh emphasized the company’s strong position in generative AI, revealing that Infosys has developed over 200 AI agents and is working on 400+ AI projects for clients. "Clients are shifting from a use-case approach to an AI-led transformation approach," Parekh stated during the press conference.
- Strategic acquisitions in energy, consulting, and cybersecurity were highlighted.
- Generative AI is now a key part of all deal discussions, including large contracts.
- Infosys is scaling domain-specific AI models, such as those built using Finacle in financial services.
Workforce and Attrition Trends
- Attrition rose to 14.1% in Q4 (up from 12.6% a year ago).
- Total headcount increased to 323,578 employees, up from 317,240.
- The company plans to hire 20,000 freshers in FY26, following 15,000 hires in FY25.
- Parekh addressed reports of layoffs at the Mysuru Campus, clarifying that employees who did not clear training assessments were offered external support.
Financial Outlook and Challenges
For FY26, Infosys provided a conservative revenue growth guidance of 0–3%, citing macroeconomic uncertainty. CFO Jayesh Sanghrajka noted that the operating margin is expected to remain between 20–22%.
- Large deal wins in FY25 totaled $11.6 billion.
- Clients are prioritizing cost optimization and vendor consolidation, though no major deal cancellations have occurred.
- Infosys faces competition, including a $1 billion IT contract battle with HCLTech for Volvo Group’s business (read more).
Industry-Wide AI Focus
- TCS and Wipro are also heavily investing in AI, with generative AI becoming central to deal discussions.
- Wipro closed 17 large deals worth $1.8 billion in Q4, with AI playing a key role.
- Despite economic headwinds, AI adoption continues to accelerate across the IT sector.
[Correction: An earlier version misstated attrition and headcount trends; both actually increased.]
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About the Author

David Chen
AI Startup Analyst
Senior analyst focusing on AI startup ecosystem with 11 years of venture capital and startup analysis experience. Former member of Sequoia Capital AI investment team, now independent analyst writing AI startup and investment analysis articles for Forbes, Harvard Business Review and other publications.