Infosys is seeing rapid growth in its artificial intelligence business, with AI-related services accounting for 10.5% of the company’s total revenue in the second quarter of FY2026–27. The Bengaluru-based IT services major reported that AI revenue grew 29% sequentially, highlighting the growing importance of artificial intelligence in its business strategy.
The development comes as global enterprises increasingly move beyond AI experiments towards large-scale implementation, automation and business transformation.
AI Revenue Rises from 8.2% to 10.5%
During the previous quarter, AI contributed 8.2% of Infosys’ revenue. Its share increased to 10.5% in the September quarter, indicating stronger demand for AI-powered services and solutions.
CEO and Managing Director Salil Parekh said the company was helping major global enterprises develop AI strategies and deploy the technology at scale.
Infosys is focusing on areas such as AI agents, legacy system modernisation, process automation and data-driven AI applications. These services can help businesses improve efficiency, modernise existing technology infrastructure and integrate AI into everyday operations.
Q2 Results Show Growth Amid Market Challenges
Infosys reported consolidated revenue of ₹49,244 crore for the September quarter, an increase of 10.7% year-on-year in rupee terms. Net profit rose 6.2% to ₹7,823 crore, while operating margin remained stable at 21%.
The company also secured large deals worth $5.2 billion in total contract value during the quarter, with 62% coming from net-new business. These contracts provide a potential foundation for future growth.
However, the broader business environment remains challenging. Infosys lowered its FY2026–27 revenue growth guidance to 1–2% in constant-currency terms, down from its earlier forecast of 1.5–3%.
AI Creates Opportunities and Pricing Pressure
While AI is opening new revenue opportunities, it is also changing the economics of traditional IT services. Clients increasingly expect technology providers to deliver productivity gains and complete projects more efficiently.
Infosys has acknowledged that some customers’ expectations for AI-driven productivity exceed what it can economically deliver. The company is therefore prioritising contracts that meet its commercial requirements while continuing to invest in AI capabilities.
This shift could gradually change how IT services companies price projects, measure productivity and structure client engagements.
What This Means for India’s IT Industry
Infosys’ growing AI revenue reflects a broader transformation underway across India’s technology services sector. Companies are investing in AI platforms, specialised talent and enterprise deployment capabilities to remain competitive.
The challenge will be converting strong AI demand into sustained revenue growth while managing pricing pressure and slower spending in traditional technology segments.
Summary
Infosys’ AI business contributed 10.5% of total revenue in Q2 FY2026–27, up from 8.2% in the previous quarter, with AI revenue growing 29% sequentially. The company is expanding into AI agents, automation and legacy modernisation. However, pricing pressure and cautious client spending have prompted Infosys to reduce its full-year revenue growth guidance to 1–2%.
