At a time when IT companies are struggling with their operating margins and are tinkering with their revenue guidance, seven new chief financial officers (CFOs) have taken charge of different IT companies in this calendar year.
Wipro’s Jatin Dalal, who is taking over as CFO of Cognizant is a recent example of a veteran leaving an IT giant to join a bigger rival. Just two months ago, Jan Siegmund, CFO, Cognizant, announced retirement from the company. Wipro eventually had to pick another veteran Aparna Iyer as the new CFO.
CK Birla Group’s IT firm Birlasoft in April this year appointed Kamini Shah as the company’s CFO. Shah was CFO of Americas One at Wipro.
Similarly, the former CFO of Americas Two, Wipro, Nithin V Jaganmohan quit the company to join Xoriant as its CFO. Prabhakar Atla was appointed as the new CFO of Cyient this year.
Quick Heal Technologies in April announced that Navin Sharma resigned as its CFO. He was succeeded by Ankit Maheshwari. In February, Devesh Dhar Dwivedi joined CMS IT as its CFO, effective 3rd February 2023, adding to the strength of senior leadership in the team.
Pareekh Jain, founder of Pareekh Consulting, said, “This is a year where we are seeing a higher number of large cost take out deals for IT companies. CFOs are part of these deal negotiations because they impact margins. IT companies are also making acquisitions and midcaps and smaller companies are seeing investments from PE funds. CFOs have taken a front seat role along with CEOs.”
In the recent earnings call, Samir Seksaria, CFO,TCS, said that the biggest headwind for them in a typical year is the wage increment. He explained, “We then typically claw back the margins through the rest of the year. With the current macro uncertainties, it would be difficult to estimate how exactly the margin recovery will play out quarter on quarter.”
Just like Seksaria, other CFOs of large IT companies have also spoken about the challenge to expand margins. Analysts also believe that most of these IT firms have seen new CEOs this year, thus making way for new CFOs who are aligned to their visions.