Infosys has rolled out an average bonus payout of 65% for its employees for the fourth quarter of FY25, a figure lower than the payouts in the preceding two quarters. This decision comes in the wake of a reported 11.7% year-on-year decline in net profit for the quarter, which amounted to ₹7,033 crore. The company's revenue guidance for FY26 remains in the low single digits, signaling cautious growth expectations.
The average bonus payout of 65% applies to employees in Band 6 and below, which primarily includes junior to mid-level staff. Actual percentages vary based on individual performance ratings. While some employees received 70% of their targeted bonus, the majority received only 50%, with higher payouts reserved for exceptional performers. These bonuses are slated to be disbursed along with the May salaries.
In previous quarters, Infosys had distributed more generous bonuses, with an average of 80% in Q3 FY25 and 90% in Q2 FY25. For Q3 FY25, the company had distributed an average performance bonus of 80% to eligible employees in delivery and sales units, comprising the majority of its workforce of over 323,000.
The recent reduction in bonus payouts reflects a cautious approach by Infosys, aligning with the current financial realities and global uncertainties impacting the IT sector. During a conference call, senior HR executives and managers communicated the decision to employees, attributing it to the decline in profits. They acknowledged the extra hours and weekend work put in by employees and assured them that better bonus recommendations would be considered once the business climate improves. The company maintains that this is a temporary downturn and that it will compensate top performers with bonus recommendations in the next growth cycle.
Infosys's Q4FY25 net profit experienced an 11.75% year-on-year (YoY) decline, reaching ₹7,033 crore, compared to ₹7,969 crore in the same period last year. However, on a sequential basis, the company's net profit saw a rise of 3.33%. The company's revenue from operations saw a rise of 7.92% YoY, reaching ₹40,925 crore, compared to ₹37,923 crore in Q4 FY24. However, there was a 2% decrease in revenue from operations sequentially.
Infosys's revenue from financial services increased by 12.6% year-on-year, while manufacturing saw a 14% increase. However, retail experienced a decline of 2.6%. While business from North America decreased by 0.4%, Europe experienced substantial growth of 15%. Overall, the company's business in India grew by 43.7% year-on-year.
Alongside the reduced bonus payouts, Infosys had issued salary revision letters in February, offering most employees a 5-8% hike. Despite this, some employees have described the Q4 bonus payout as "tepid". Unlike previous quarters, there was no overarching communication praising employees or outlining the business outlook.
The company's performance for the year has been robust in terms of revenues, expansion in operating margins, and free cash generation. Infosys has issued a guarded FY26 guidance of 0-3% constant currency revenue growth and operating margin of 20-22%. The board of directors has also approved a final dividend of ₹22 per equity share for the financial year ending March 31, 2025. The record date for the dividend is May 30, 2025, and the payment date is June 30, 2025.
