Infosys Q2 FY26 Results: Profit Soars 13%, Guidance Raised, Major Buyback Announced

Infosys delivered a powerful performance in the second quarter of fiscal year 2026, beating market expectations with a 13.2% year-on-year (YoY) rise in net profit and raising its full-year revenue guidance. For investors and analysts questioning the health of the IT sector, these results signal strong resilience, driven by healthy deal momentum and stable margins. The company further rewarded shareholders with an interim dividend of Rs. 23 per share and a substantial Rs. 18,000 crore share buyback plan, underscoring its confidence in future cash flows.

This detailed analysis breaks down the Infosys Q2 FY26 results, what they mean for the company's outlook, and the key takeaways for investors.

Table of Contents

1. How Did Infosys Perform in Q2 FY26? A Look at the Key Numbers
2. What is Driving Infosys's Growth? (Deal Wins & AI Momentum)
3. Why Did Infosys Raise Its Revenue Guidance?
4. What are the Details of the Infosys Dividend and Buyback?
5. The Investor's Bottom Line: Is Infosys a Good Buy After These Results?
6. Frequently Asked Questions (FAQs)

How Did Infosys Perform in Q2 FY26? A Look at the Key Numbers

Infosys reported steady and robust growth across its key financial metrics, demonstrating solid execution in a challenging global environment. The company's consolidated net profit for the quarter stood at Rs. 7,364 crore, while revenue from operations grew by 8.6% YoY to Rs. 44,490 crore.

Key Financial Highlights for Q2 FY26

The company successfully maintained a stable operating margin of 21.0% and generated a strong free cash flow of $1.1 billion during the quarter.

What is Driving Infosys's Growth? (Deal Wins & AI Momentum)

A standout positive for investors was the company's robust deal pipeline. Infosys secured large deals with a Total Contract Value (TCV) of $3.1 billion. Crucially, 67% of this TCV was from net new business, indicating that Infosys is gaining market share and winning new clients, not just renewing old contracts.

CEO and MD Salil Parekh attributed this success to the company's client relevance and ability to deliver value from AI. He stated, "Strong deal wins...reflect our deep understanding of clients’ priorities to deliver value from AI in this environment." This commentary highlights that Infosys's investments in its AI platform, Infosys Topaz, are translating into tangible business wins, particularly in the financial services and manufacturing sectors.

Why Did Infosys Raise Its Revenue Guidance?

In a significant vote of confidence, Infosys narrowed and raised the lower end of its revenue growth guidance for the full fiscal year 2026. This move signals better-than-expected demand visibility for the second half of the year.

• FY26 Revenue Guidance: Revised to 2%-3% growth in constant currency, up from the previous forecast of 1%-3%.

• FY26 Operating Margin Guidance: Maintained at a stable 20%-22%.

This guidance upgrade is a strong positive signal from the management and sets Infosys apart from peers who may be more cautious about the future demand environment.

What are the Details of the Infosys Dividend and Buyback?

Reinforcing its commitment to shareholder returns, the Infosys board approved two major capital allocation measures:

• Interim Dividend: A dividend of Rs. 23 per equity share has been declared. The record date to be eligible for this dividend is 27 October 2025.

• Share Buyback: A plan to buy back shares worth a massive Rs. 18,000 crore at a price of Rs. 1,800 per share was approved. This buyback is subject to shareholder consent.

These shareholder-friendly moves reflect the company's strong cash flow generation and a confident outlook on its financial health.

The Investor's Bottom Line: Is Infosys a Good Buy After These Results?

Infosys's Q2 performance is a testament to its strong execution and strategic focus in a tough market. For investors, the key takeaways are:

• Resilient Performance: The ability to deliver double-digit profit growth and raise guidance in the current climate showcases the company's defensive strength.

• Strong Demand Signals: The $3.1 billion in deal wins, with a high proportion of net new business, confirms that Infosys continues to win large transformation projects.

• AI is Delivering: Management's commentary confirms that investments in AI are paying off and are a key differentiator in securing new deals.

• Generous Shareholder Rewards: The substantial buyback and healthy dividend provide a strong incentive for long-term investors.

While the broader IT spending environment remains uncertain, Infosys's strong Q2 results and confident outlook position it as a leader in the sector. These results are likely to be viewed by the market as a validation of its strategy and a sign of continued strength.

Frequently Asked Questions (FAQs)

What was Infosys's net profit in Q2 FY26?
Infosys reported a consolidated net profit of Rs. 7,364 crore for Q2 FY26, marking a 13.2% year-on-year increase.

Did Infosys raise its guidance for FY26?
Yes, Infosys raised the lower end of its revenue growth guidance for FY26. The new guidance is for 2%-3% growth in constant currency, revised from the earlier 1%-3%.

What dividend did Infosys declare?
Infosys declared an interim dividend of Rs. 23 per equity share for FY26. The record date for the dividend is 27 October 2025.

What are the details of the Infosys share buyback?
Infosys announced a share buyback plan worth Rs. 18,000 crore. The company will buy back shares at a price of Rs. 1,800 per share.

How strong were Infosys's deal wins in Q2?
Infosys secured large deals with a Total Contract Value (TCV) of $3.1 billion. A significant 67% of this TCV was from net new business, indicating strong market share gains.

What is the attrition rate at Infosys?
Infosys's voluntary attrition rate continued to decline, falling to 14.3% in Q2 FY26, indicating improved employee retention and operational stability.