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Wipro's new CEO plans 'obsession for growth' as plague slowed it in Q1

Contractors look to have copped it as offshore utilisation rates grew

Wipro's new CEO Thierry Delaporte has offered some initial insights into his plans for the services giant.

"I will drive an obsession for growth in the organization, obsession for growth, for growing our topline everywhere," Delaporte said on the company's Q1 20/21 earnings call for the quarter ended June 30.

"My view is that to drive growth, it's going to be about certainly high energy, absolute focus on that, ready to focus the investments to the accounts that matter to us … leveraging the offerings where we have strengths and the industries and the position we have in our industry."

The CEO said Wipro will "take some bets" and "be bold in going after these bets." He also mentioned growing talent and "constantly challenge [the] status quo inside the organization" to improve responsiveness, allow more client-facing time and streamline internal processes.

Delaporte had been in the job for a week at the time of the remarks, so The Register and investors alike can forgive him for not offering more specific plans! He did mention ensuring the health and safety of staff as a priority, plus the usual new CEO world tour of customers to figure out what they want and/or expect.

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CFO Jatin Dalal told investors that in Q1 customers clamoured for cloud, collaboration and security. "We are also seeing great uptick in offerings like VDI, SD-WAN, excellent traction for our digital operations and platform offerings in this post-COVID era," he added.

Those desires led to a 1.3 per cent increase in year-on-year revenue for the quarter, at $2.0bn, down from last year's 5+ per cent growth. The company also recorded a 5.7 per cent drop in IT services revenue to $1.921bn. Net income of $316.5m was a 0.1 per cent improvement on last year's number.

Pondering the future, Dalal said Wipro is "seeing some stability returning in our consumer business unit, in our tech business unit, and in our communication business unit. For others, we will watch it closely as to how the traction unfolds during the course of quarter two." The company also hopes that as the pandemic eases it is able to do more fee-for-service work, while 60 per cent of its gigs are fixed-price affairs Wipro isn't paid if it can't deliver services on other gigs.

But even that problem may not be massive as execs said they've looked closely at the company's "variable workforce" and improved offshore resource utilisation rates.

International expansion is another Q2 plan: the company today announced the acquisition of Brazilian IT services provider IVIA Servicos de Informatica Ltd.

Dalal said the company "gives us a good access into northeast Brazil. It gives us access into new set of customers that we don't have in financial services, retail, public sector, and manufacturing services. It's a profitable business which has been growing rapidly, and above all, you know, it provides us a great opportunity in terms of sourcing this talent, which is very capable and very cost competitive for our global business."

Execs predicted "stability" for Q2, revealing that in Q1 some customers deferred projects or discussions about new deals, but that the company's order book and pipeline are better than they have been in previous years. However, CFO Bhanumurthy Ballapuram also said: "What we're seeing is that the velocity of decision making is still not at the pre-COVID levels." ®

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