Infosys Tumbles 14%: FYQ4 Misses, Q1, Year View Weak

Shares of IT services firm�Infosys�(INFY) are down $7.82, or almost 14%, at $48.95 in early trading after the company this morning reported fiscal Q4 revenue below analysts’ estimates, and forecast the current quarter’s results and the year results to miss as well.

Revenue in the three months ended in March rose 10.5%, year over year, to $1.77 billion, yielding EPS of 81 cents.

The Street had been modeling $1.81 billion and 81 cents.

The revenue result was also below the company’s forecast range of $1.806 billion to $1.81 billion. It was also the first time in two years that the company saw a quarter-to-quarter decline in revenue.

Infosys’s CEO S.D. Shibulal warned, “the year ahead looks challenging for the IT services industry, with slow recovery in the global markets.”

For fiscal Q1, the company forecast revenue in a range of $1.77 billion to $1.79 billion, and EPS of 73 cents, versus consensus estimates of $1.85 billion and 76 cents.

For the full year, the company sees revenue in a range of $7.55 billion to $7.69 billion, and EPS in a range of $3.12 to $3.17 per share. That is below the consensus of $7.79 billion and $3.32 per share.

Infosys held its conference call with analysts at 4:30 am this morning. The archive of that call is available here.

Update: Brian Marshall of ISI Group, who follows Hewlett-Packard (HPQ), today reiterated a Buy on the company’s stock, writing that Infosys is perhaps not selling the right kinds of services — too focused on “IT services” per se rather than consulting and other higher-value jobs:

INFY has seen order cutbacks in the financial services sector and in the U.S. as well as contract delays. It said that it would grow below industry average rates this year and also suggested client confidence had dipped.�Despite a poor outlook last quarter (e.g., warning of a weak Europe, cautious customers, etc.), enterprise IT names had a strong Dec-11 earnings season. ACN (~$40bil market cap), which provides many higher-value IT consulting services, had solid results last month in contrast to INFY.