Narayan AmmachchiIndian IT giant Infosys raised eyebrows after abruptly canceling a US$1.5 billion contract signed in September 2023. Neither the name of the client nor the reason for the contract’s cancellation were disclosed.
This move comes at a time when the company is already facing internal reshuffles and slower revenue growth, adding to existing anxieties in the market.
The canceled contract involved Infosys deploying its artificial intelligence (AI) solutions to “enhance digital experiences” for the unnamed client. This sudden termination, particularly amidst challenges in securing new contracts, has sparked various questions and concerns.
Adding to the intrigue is the recent wave of senior executive departures at Infosys. Just three weeks ago, Nilanjan Roy, the company’s CFO for over six years, unexpectedly resigned. In total, six top executives exited the firm in 2023.
In its recent briefing to investors, Infosys scaled back its full-year revenue forecast, projecting growth of 1% to 2.5%.
Despite these internal headwinds and a dip in revenue growth, Infosys’ stock remained relatively stable over the past year.
This can be partly attributed to the company securing several large contracts during the same period, including a US$1.64 billion deal with London-based Liberty Global and another US$2 billion deal with an unnamed client. Infosys raked in contracts worth over US$7.7 billion in just the third quarter of 2023.
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