GlobalData: Wipro shows no sign of slowing after banner year
FYI, this story is more than a year old
Indian-based but globally operating IT services company Wipro is looking into a bright future thanks to a series of positive events over 2019, says GlobalData in a statement.
Factors include the rising adoption of artificial intelligence (AI) and machine learning (ML) portfolio, a steady fourth quarter (Q4) 2019 performance and double-digit quarterly growth (year-on-year) in the consumer and digital segment, and the October 2019 acquisition of International TechneGroup.
To find these insights, GlobalData uses its Company Filing Analytics Platform which analyses and showcases sentiments across companies and sectors by scanning through earning transcripts and filing documents.
This process found Wipro’s overall sentiment score rose 17% during the Q4 2019, surpassing past quarter scores and reaching the highest in the last two years.
In comparison, Infosys (Wipro’s competitor in the ‘AI for business’ segment), saw its sentiments decline due to a quarter plagued by investigation and whistleblower incidents.
Wipro’s digital segment has seen rapid growth in recent years and currently accounts for 40% of the overall revenue.
With AI set to influence multiple industry trends, Wipro is fueling AI investments.
In January 2020, Wipro announced a US$150m fund to invest in companies focused on cybersecurity, app development, data analytics, cloud, automation and AI.
The company’s strategy on data analytics and AI is paying off with the acquisition of International TechneGroup, which helped Wipro in securing its future roadmap for Industry 4.0 and IoT offerings.
According to CFO Jatin Dalal, the acquisition added to the company’s quarter-on-quarter revenue growth (constant currency terms).
This was also outlined in the Q4 2019 earnings transcript by CEO Abidali Neemuchwala, who commented that the acquisition also helped Wipro secure a new contract with a global automotive giant’s subsidiary in North America, under the EngineeringNXT portfolio.
“Wipro is now recognised as a leading AI consultancy, which is also testified by it receiving a top mention in The Forrester Wave: AI Consultancies report,” GlobalData lead analyst Aurojyoti Bose says.
“Currently, the company has signed small deals for the HOLMES AI portfolio. The management is focused on expanding the ‘HOLMES for business’ portfolio across various industry verticals. The company has gained traction for its AI offering by successfully showcasing its value-based pricing models designed for product delivery.”
In the context of AI, Wipro signed a strategic contract with a major US-based financial services institution to formulate an effective compliance management framework while leveraging AI.
Since the launch of the HOLMES portfolio (AI and ML) solutions on Amazon Web Services in March 2019, the portfolio has seen success in gaining 280 customers as of the end of December 2019.
In September 2019, Wipro signed a pivotal US$300m contract with ICICI bank, to provide an all-inclusive suite of automation products.
“The rapid growth that Wipro is seeing in the digital segment is due to clients’ preference for the company’s novelty AI offerings. In the coming quarters, Wipro is likely to invest in newer technologies to enhance current offerings for clients, which the management considers a priority over maintaining margins,” Bose adds.