After rolling out variable payouts of around 80% for two quarters, Indian IT giant Infosys reduced its average variable pay to 73% given to its employees for the third quarter of current fiscal.
Infosys had reduced its variable pay to 60% for the March quarter of FY23, citing global macro-economic headwinds. A source said that while the average payout is at 73%, the variable payout ranged between 65% – 105% in Q3. Questions mailed to Infosys didn’t elicit any response till the time of going to print.
To boost margins, the Bengaluru based IT major defered its salary hikes to employees for about five months and finally rolled out hikes to a majority of its employees in December last year. Infosys brought down its revenue guidance for this fiscal for the third time in a row, amid a hazy macro uncertain environment, where clients are still not sure about tech spending benefits.
The IT giant narrowed its sales forecast to 1.5% – 2%, down from its second revised FY24 revenue projection of 1 – 2.5% that it estimated during the Q2 earnings announcements. In July, the IT major’s first revised guidance ranged between 1% to 3.5%. At the start of this fiscal, the company gave a guidance of 4% – 7%. Infosys, however retained its operating margin guidance retained at 20%-22%.
While cross-town rival Wipro is yet to give out its variables for Q3 to its employees, the company paid a standard 80% variable pay to its employees in Q2. A recent mail from Wipro to employees stated that the variable payout will be linked to three factors – revenue (40%), gross margin (30%) and total contract value (30%).