Persistent Systems Reports Strong Q1 FY25 Growth Amid IT Industry Challenges

Large IT firms' fatigue on deal wins helping Persistent: CEO Sandeep Kalra

For the first quarter ending June, Persistent reported a 33.9% year-on-year (YoY) rise in net profit at Rs 306.41 crore for their April to June quarter as compared to Rs 228.76 crore in the same quarter last year. However, sequentially, the profit fell 2.8% from Rs 315.3 crore.Mid-tier IT firm Persistent Systems' top executive continues to see higher deal wins compared to its bigger outsourcing peers. This is helping the Pune-based IT firm in grabbing a higher market share. The company has grown it's revenues by 268% since 2020. In an interaction with ET, Sandeep Kalra, chief executive officer and executive director, Persistent said, "Persistent, at $1.2 billion, is competing with bigger vendors, whether they are from India or from outside and winning market share. Obviously, when you're doing vendor consolidation, you are optimising by moving work from onset to offshore, there's transition involved in other things involved. So, there's a cost involved." According to him, "There is a clear fatigue with the larger players. The reason being they have become too big to react, too big to take care of the customers will be complacent in their own right. And they are not able to bring the latest technology to bear for the customers." It is now aspiring $2 billion business in the next three years. Amid the generative AI (GenAI) technology disruption, the over $250 billion IT sector is witnessing vendor consolidation and a shrinking of deal sizes thereby leading to higher competition in deal wins across large and mid-tier software service providers. Reporting the 17th consecutive quarter of dollar revenue growth and the 20th quarter growth in rupee terms, Kalra said, "We have seen good bookings in the last two quarters, and that will also pan out well.Overall, it'd be a growth story made by healthcare, followed by financial services followed by tech for Persistent for the next several quarters." For Q1FY25, Persistent saw its total contract value (TCV) deal wins at $462.8 million, up from $447.7 million in the March quarter. For the first quarter ending June, Persistent reported a 33.9% year-on-year (YoY) rise in net profit at Rs 306.41 crore for their April to June quarter as compared to Rs 228.76 crore in the same quarter last year. However, sequentially, the profit fell 2.8% from Rs 315.3 crore. Its revenue rose 17.9% YoY and 5.6% quarter-on-quarter (QoQ) to Rs 2,737.17 crore with jump YoY 66.8% jump in healthcare, 7.3% in banking, financial services and insurance (BFSI) and a subdued growth of 2.4% in its largest segment of software, hi-tech and emerging industries. Chief financial officer Vinit Teredesai said its margins contracted by 50 basis points (bps) to 14% from 14.5% on the back of high visa costs towards employees under sub-contracting and employee stock options across a majority of its employees. "If you look at it, we have increased our revenue by around $16 million this quarter. And our headcount has gone down by 330 people. Our utilisation has also increased to 82%. there is easily a scope to go up closer to 84-85%. Our long term goal is to improve our margins by 200 to 300 basis points by the in the next two to three years," Teredesai said. Kalra wants the company to be the disruptor in the ongoing GenAI technology disruption and is investing in building capabilities. "We are pivoting from a human driven services company only to a tech and human driven platform So it takes investments. That is what is also making us win more," he added. We are investing heavily in our platforms, we are also doing small tuck-in acquisitions. Last month, the IT company had acquired New Jersey-based Starfish Associates for $20.7 million (around Rs 173 crore).

Persistent Records $328.2 Million Revenue in Q1 FY25 with 5.6% Q-o-Q, 16.0% Y-o-Y Growth

Pivots to AI-led, platform-driven services approach Persistent Systems (BSE: 533179 and NSE: PERSISTENT) today announced the Company's audited financial results for the quarter ended June 30, 2024, as approved by the Board of Directors. Consolidated Financial Highlights for the Quarter ended June 30, 2024 Q1FY25Margin%QoQ YoY Revenue (USD Million)328.2 5.6%16.0%Revenue (INR Million)27,371.7 5.7%17.9%EBITDA (INR Million)4,552.116.6%0.2%7.6%PBT (INR Million)4,005.414.6%1.3%30.4%PAT (INR Million)3,064.211.2%-2.8%33.9% The 34th Annual General Meeting of the Company was held on July 16, 2024. All the resolutions, including final dividend payment of INR 10 per share, were approved by the members with requisite majority. Sandeep Kalra, Chief Executive Officer and Executive Director, Persistent: "I am pleased to announce our 17th consecutive quarter of revenue growth, underscoring our clients' sustained trust and confidence in us. Our continued success is driven by resilience, innovation, and a strategic focus on future readiness. We have pivoted to an AI-led, platform-driven services approach, deepening our hyperscaler partnerships and developing a suite of innovative solutions. Recognizing our transformative digital solutions, ISG, the leading advisory firm, ranks us as a Leader for Digital Engineering services in the US and Europe 2024, for the second year in a row. Ms. Roshini Bakshi retired as an Independent Director from our Board after a decade. We thank her for her leadership and guidance. We are delighted to welcome Ms. Anjali Joshi as an Independent Director. Her vast expertise as a technology leader will enrich our Board and guide us on our growth journey." First Quarter FY25 Client Wins and Outcomes The order booking for the quarter ended on June 30, 2024, was at $462.8 million in Total Contract Value (TCV) and at $337.3 million in Annual Contract Value (ACV) terms. Some of the key wins for the quarter include: Software, Hi-Tech & Emerging IndustriesDelivering engineering and support services to accelerate the virtual private cloud roadmap and provide managed services for one of the largest US-based technology companiesConsolidating R&D operations globally and enhancing productivity to advance the AI, data, and SaaS strategy of a leading European network lifecycle automation companySetting up greenfield IT and security operations with managed services model to ensure timely transition for an application security testing firm, a PE-led carve-out from a top semiconductor companyBanking, Financial Services & InsuranceModernizing customer data applications, enhancing risk and sales business KPIs, and implementing GenAI to improve customer experience for an American financial services and wealth management companyBuilding a cloud-native payment rail solution to enable real-time payments for the customers of one of the largest US-based fintech companiesTransforming legacy platforms and digitizing processes to elevate the experience of business banking customers for a leading Australian multinational bankHealthcare & Life SciencesEnhancing the software platform that tracks sample processing as well as reagent and instrument usage to improve turnaround time and reduce manual errors for a leading precision oncology companyMigrating on-prem clinical and claim data warehouse to a cloud-based platform to boost analytics efficiency for a multinational health insurance companyUndertaking product lifecycle management of critical applications for genetic condition diagnostics to increase operational efficiency for a leading US-based diagnostics companyNews in the QuarterPersistent Acquires Starfish Associates, Strengthening its Position in AI-powered Contact Center and Unified CommunicationsPersistent Enters into Strategic Partnership Agreement to Drive Innovative Solutions Powered by Google CloudPersistent Achieves Premier Services Partner Status with Snowflake, Boosting Data Management and Analytics CapabilitiesPersistent Transforms Enterprise Data Management with iAURA, a Portfolio of AI-Powered Data SolutionsAwards and RecognitionsPersistent's Founder, Chairman, and Managing Director, Dr. Anand Deshpande honored with the Association of Computing Machinery Presidential Award 2023Persistent ranked a Leader in ISG Provider Lens™ Digital Engineering Services Quadrant Report U.S. 2024Persistent named a Leader in ISG Provider Lens™ Digital Engineering Services Quadrant Report for Europe, 2024Persistent cited a Leader and Rising Star in ISG's Provider Lens™ Salesforce Ecosystem Partners 2024 ReportPersistent Recognized for Excellence in Governance and Executive Leadership in Institutional Investor's 2024 Asia Executive Team SurveyPersistent won the "Masters of Risk" award in the Risk Governance category at the CNBC-TV18 India Risk Management AwardsAbout Persistent Persistent Systems (BSE & NSE: PERSISTENT) is a global services and solutions company delivering Digital Engineering and Enterprise Modernization to businesses across industries. With over 23,500 employees located in 19 countries, the Company is committed to innovation and client success. Persistent offers a comprehensive suite of services, including AI-enabled software engineering, product development, data and analytics, CX transformation, cloud computing, and intelligent automation. The Company has been recognized as the "Most Promising Company" of the Year by CNBC-TV18 at the 2023 India Business Leader Awards. As a participant of the United Nations Global Compact, Persistent is committed to aligning strategies and operations with universal principles on human rights, labor, environment, and anti-corruption, as well as take actions that advance societal goals.

Persistent Records $328.2 Million Revenue in Q1 FY25 with 5.6% Q-o-Q, 16.0% Y-o-Y Growth

Pivots to AI-led, platform-driven services approach PUNE, India and SANTA CLARA, Calif. , July 18, 2024 /PRNewswire/ -- Persistent Systems (BSE: 533179) PERSISTENT today announced the Company's audited financial results for the quarter ended June 30, 2024, as approved by the Board of Directors. Consolidated Financial Highlights for the Quarter ended June 30, 2024 The 34th Annual General Meeting of the Company was held on July 16, 2024. All the resolutions, including final dividend payment of INR 10 per share, were approved by the members with requisite majority. Sandeep Kalra, Chief Executive Officer and Executive Director, Persistent: "I am pleased to announce our 17th consecutive quarter of revenue growth, underscoring our clients' sustained trust and confidence in us. Our continued success is driven by resilience, innovation, and a strategic focus on future readiness. We have pivoted to an AI-led, platform-driven services approach, deepening our hyperscaler partnerships and developing a suite of innovative solutions. Recognizing our transformative digital solutions, ISG, the leading advisory firm, ranks us as a Leader for Digital Engineering services in the US and Europe 2024, for the second year in a row. Ms. Roshini Bakshi retired as an Independent Director from our Board after a decade. We thank her for her leadership and guidance. We are delighted to welcome Ms. Anjali Joshi as an Independent Director. Her vast expertise as a technology leader will enrich our Board and guide us on our growth journey." First Quarter FY25 Client Wins and Outcomes The order booking for the quarter ended on June 30, 2024, was at $462.8 million in Total Contract Value (TCV) and at $337.3 million in Annual Contract Value (ACV) terms. Some of the key wins for the quarter include: Software, Hi-Tech & Emerging Industries Delivering engineering and support services to accelerate the virtual private cloud roadmap and provide managed services for one of the largest US-based technology companiesConsolidating R&D operations globally and enhancing productivity to advance the AI, data, and SaaS strategy of a leading European network lifecycle automation companySetting up greenfield IT and security operations with managed services model to ensure timely transition for an application security testing firm, a PE-led carve-out from a top semiconductor company Banking, Financial Services & Insurance Modernizing customer data applications, enhancing risk and sales business KPIs, and implementing GenAI to improve customer experience for an American financial services and wealth management companyBuilding a cloud-native payment rail solution to enable real-time payments for the customers of one of the largest US-based fintech companiesTransforming legacy platforms and digitizing processes to elevate the experience of business banking customers for a leading Australian multinational bank Healthcare & Life Sciences Enhancing the software platform that tracks sample processing as well as reagent and instrument usage to improve turnaround time and reduce manual errors for a leading precision oncology companyMigrating on-prem clinical and claim data warehouse to a cloud-based platform to boost analytics efficiency for a multinational health insurance companyUndertaking product lifecycle management of critical applications for genetic condition diagnostics to increase operational efficiency for a leading US-based diagnostics companyNews in the QuarterPersistent Acquires Starfish Associates, Strengthening its Position in AI-powered Contact Center and Unified CommunicationsPersistent Enters into Strategic Partnership Agreement to Drive Innovative Solutions Powered by Google CloudPersistent Achieves Premier Services Partner Status with Snowflake, Boosting Data Management and Analytics CapabilitiesPersistent Transforms Enterprise Data Management with iAURA, a Portfolio of AI-Powered Data SolutionsAwards and RecognitionsPersistent's Founder, Chairman, and Managing Director, Dr. Anand Deshpande honored with the Association of Computing Machinery Presidential Award 2023Persistent ranked a Leader in ISG Provider Lens™ Digital Engineering Services Quadrant Report U.S. 2024Persistent named a Leader in ISG Provider Lens™ Digital Engineering Services Quadrant Report for Europe, 2024Persistent cited a Leader and Rising Star in ISG's Provider Lens™ Salesforce Ecosystem Partners 2024 ReportPersistent Recognized for Excellence in Governance and Executive Leadership in Institutional Investor's 2024 Asia Executive Team SurveyPersistent won the "Masters of Risk" award in the Risk Governance category at the CNBC-TV18 India Risk Management Awards About Persistent Persistent Systems (BSE & NSE: PERSISTENT) is a global services and solutions company delivering Digital Engineering and Enterprise Modernization to businesses across industries. With over 23,500 employees located in 19 countries, the Company is committed to innovation and client success. Persistent offers a comprehensive suite of services, including AI-enabled software engineering, product development, data and analytics, CX transformation, cloud computing, and intelligent automation. The Company has been recognized as the "Most Promising Company" of the Year by CNBC-TV18 at the 2023 India Business Leader Awards. As a participant of the United Nations Global Compact, Persistent is committed to aligning strategies and operations with universal principles on human rights, labor, environment, and anti-corruption, as well as take actions that advance societal goals. www.persistent.com Forward-looking and Cautionary Statements For risks and uncertainties relating to forward-looking statements, please visit persistent.com/flcs Logo: https://mma.prnewswire.com/media/1022385/4436045/Persistent_Systems_Logo.jpg SOURCE Persistent Systems Market News and Data brought to you by Benzinga APIs