Infosys reports strong sales but profits fall due to cash reserved for Visa dispute

Financial results

Infosys reports strong sales but profits fall due to cash reserved for Visa dispute

Karl Flinders

Indian IT services supplier Infosys increased its sales by 15% in its latest financial quarter, but profits fell as a result of the company putting money aside to cover potential costs in relation to a visa compliance dispute with the US government.

Infosys made sales of $2.07bn in the three months to 30 September 2013, but profits fell by 11.1% to $383m during the quarter.

Infosys HQ.jpg

The company put money aside to cover costs, including legal charges, relating to allegations that it misused the US visa system.

Infosys said in a statement: “Infosys is engaged in discussions with the US Attorney's office and other government departments regarding a civil resolution of the government's investigation into the company's compliance with Form I-9 requirements and past use of B-1 visas. Based on the status of those discussions, Infosys has set aside a reserve of $35m, including legal costs.”

The company said it could not give more information on the discussions with the US because discussions were ongoing.

Infosys CEO S D Shibulal said the company won five large deals and increased sales of big data and cloud services during the second quarter. 

"We will continue with planned investments and initiatives to explore new avenues of growth. We remain watchful of the sustainability of improving global economic fundamentals.”

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