Wipro sees discretionary spend return in US

Bangalore, July 24 (IANS) India's third largest IT firm Wipro Ltd Thursday said it saw discretionary spending return in North America, as the demand environment continued to be steady.

"The demand environment continues to hold steady. In North America, we see a return of discretionary spending. Continental Europe continues to have significant potential for outsourcing IT services," Wipro chief executive T.K. Kurien told reporters here.

Discretionary spending is the amount enterprises budget in a year on new projects resulting in more outsourcing of their IT services to global software vendors like Wipro as against non-discretionary spending made on operating and maintaining their existing IT infrastructure services.

Asserting that the deal pipeline was healthy, Kurien said demand in healthcare and life sciences was strong and business momentum was improving in manufacturing and hi-tech while it (demand) was challenging in retail sector.

"From a geo perspective, we saw good growth come from the India and Middle East (West Asia/Gulf) business, as evident from five percent sequential growth in global infrastructure services," he said.

Observing that open source technologies have moved mainstream in the infrastructure and application layer with traditional enterprises adopting models from web-based companies, Kurien said the company was engaged with leading clients to re-architect their technology landscape to achieve cost savings, innovation and agility.

"Digital transformation is driving our clients to rethink on how they protect themselves from disruption by improving customer relevance and cost efficiency by digitising their legacy processes and infrastructure," he noted.

The city-based company continues to invest in technology and human resources to enable its customers compete better in the marketplace and to improve its execution capability.

Wipro Thursday posted net profit of Rs.2,118 crore (approx $352 mn) for 2014-15's first quarter (April-June), registering 30 percent growth year-on-year (YOY) under the Indian accounting standard, while projecting an average higher revenue of $1.8 billion from its global IT services business for the second quarter.