Infosys reported a 9.6% sequential drop in consolidated net profit to Rs 6,654 crore for the December quarter (Q3 FY26), while revenue from operations rose 2.22% quarter-on-quarter to Rs 45,479 crore. On a year-on-year basis, net profit declined 2.2%, while revenue increased 8.9%.

Profit before tax stood at Rs 9,229 crore, down 9.78% quarter-on-quarter and 4.56% year-on-year. Operating profit fell 10.7% sequentially and 6.3% year-on-year to Rs 8,355 crore, with operating margin easing to 18.4% from 21.3% a year ago.

The company said its results were impacted by higher employee-related costs following the implementation of India’s new Labour Codes, notified on 21 November 2025. The changes, which consolidate 29 labour laws, led to higher gratuity and leave liabilities. Infosys recorded a one-time impact of $143 million (Rs 1,289 crore) in its consolidated statement of comprehensive income.

Infosys raised its FY26 constant currency revenue growth forecast to 3.0-3.5%, from 2-3% earlier, while maintaining its operating margin guidance at 20-22%. Constant currency revenue grew 1.7% year-on-year and 0.6% quarter-on-quarter in Q3 FY26. Revenue in dollar terms rose 3.2% year-on-year to $5,099 million.

The improved outlook helped lift sentiment across the IT sector, driving broad-based buying in frontline technology stocks.