Infosys Limited reported a strong performance for the third quarter of FY26, with revenues growing 0.6% sequentially and 1.7% year-on-year in constant currency terms. The company secured large deals worth $4.8 billion, with 57% of these being net new, across 26 deals. The adjusted operating margin stood at 21.2%, and free cash flow generated was $915 million.

A significant win was a $1.6 billion deal with the National Health Service (NHS) in the U.K., aimed at leveraging AI to streamline operations and improve patient care. Infosys also deepened its AI capabilities with the launch of Topaz Fabric, an agent services suite. The company is actively involved in AI adoption, working with 90% of its largest 200 clients on AI projects, generating over 28 million lines of code using AI, and building over 500 AI agents.

Infosys identified six emerging AI-led value pools: AI engineering services, Data for AI, Agents for operations, AI software development and legacy modernization, AI in physical devices, and AI trust and risk services. The company believes it is well-positioned to capture market share in these areas. An Investor Day will be held later this quarter to provide a comprehensive view of their AI strategy.

Due to the strong Q3 performance, Infosys revised its revenue growth guidance for the financial year to 3% to 3.5% in constant currency. The operating margin guidance remains unchanged at 20% to 22%.

During the earnings call, management addressed questions regarding headcount increases, which reflect confidence in market demand and investments in future capacity. They also clarified margin movements, attributing a 20 basis point sequential expansion to currency benefits and Project Maximus, offset by furloughs and higher variable pay accruals. Investments in sales and marketing, and lower utilization due to capacity building, were absorbed within the margins. The company highlighted strong traction in Financial Services and Energy, Utilities, Resources, and Services verticals, expecting acceleration in FY27. Infosys also confirmed no employees have been apprehended by U.S. authorities and discussed its approach to M&A, focusing on cyber, consulting, and energy services, and its continued flexibility in work-from-home policies.