Why infosys share falling?
As someone who follows IT stocks closely, Infosys shares have been facing multiple headwinds recently. The primary reason is weakening global IT spending due to economic uncertainties in key markets like US and Europe. Many clients are delaying or reducing digital transformation projects to conserve cash. Additionally, Infosys recently lowered its revenue guidance for the fiscal year, which always impacts investor sentiment. The rising employee costs and attrition challenges in the IT sector are also squeezing margins. The stock typically reacts negatively to these macro factors even though the company fundamentals remain strong long-term.
As an IT investor, Infosys drop sucks—slid 1.62% intraday Sep 26 amid sector slump post-Accenture's dour forecast. Q1 profit up 9% to ₹6,921 Cr, but revenue flat at 3.6%, blamed on US caution and Europe softness. Geopolitics (tariffs, elections) hit client spends; FII outflows too. Shares off 14.7% monthly, 15.5% YTD. Promoter hold steady at 13.05%. Upside? Revised FY26 guidance to 1-3%. But watch macros. Economic Times has charts. Your take?
From my analysis as a market researcher, there are several factors contributing to Infosys's stock performance. Sector-wide rotation is happening where investors are moving money from IT to other sectors showing faster growth. Specific to Infosys, there have been concerns about slower deal conversions and some large contract cancellations recently. The company's Q3 results showed margin pressure despite meeting revenue expectations. Also, the strengthening rupee affects IT companies since they earn primarily in dollars. All these factors combined have created negative sentiment around the stock in the short to medium term.
I think everyone is missing the internal factor: Generative AI disruption. The market is punishing IT companies that they perceive as being slow to adapt or those whose business models are most vulnerable to automation. Investors are worried that services like legacy application maintenance or basic code generation, which are current revenue drivers, will be rapidly replaced by GenAI tools. Infosys, like all large IT service firms, is investing heavily in AI, but the market is demanding proof that these investments will quickly translate into new, high-margin revenue streams to replace the potentially declining traditional services. Until that proof is consistently delivered in quarterly results, the fear of margin compression and revenue stagnation will keep the stock price under pressure.
I think part of it is global economic slowdown. Many IT giants like TCS, Wipro, and Infosys are facing client budget cuts. When big tech spends less, outsourcing companies feel the heat, leading to stock dips.
Infosys shares fluctuate based on market conditions. Recently, they fell because of lower-than-expected quarterly earnings and cautious guidance. Investors were concerned about slower growth in IT spending from US and European clients. Check NSE’s market update for the latest numbers.
Look, when you're talking about the Indian IT sector, a lot of the stock movement isn't just about domestic performance; it's about geopolitical factors and US policy. A major concern that can spook investors is any talk of changes to the H-1B visa program in the United States. Since Infosys relies heavily on sending skilled workers to the US on these visas for on-site client work, any proposed increase in the visa fee (as has been rumored from time to time by different administrations) or stricter regulations directly threatens their operational business model and profit margins. Investor fear translates immediately into selling pressure, causing the shares to fall, even if the policy change hasn't been officially implemented. It's all about risk and future outlook.
The stock market is a complex beast, but when a major IT player like Infosys sees its shares dip, it's usually a combination of global and sector-specific pressures, rather than one single event. Recently, a significant factor has been global economic uncertainty and the subsequent reduction in IT spending by large clients in key markets like the US and Europe. When these clients face economic headwinds, they often defer or scale back large digital transformation projects, which directly impacts the revenue and future guidance of companies like Infosys. Additionally, Infosys's performance, while generally solid, is often compared to its peers. If they miss their own revenue guidance or if a competitor like Accenture reports stronger-than-expected earnings, it can cause a relative drop in Infosys's share price as investors shift capital.
Ugh, Infosys shares are hurting—down 2.42% to ₹1,448.90 on Sep 26, 2025, after Q1 FY26 results missed marks. Revenue grew just 3.6% YoY, hit by US slowdowns and delayed deals; BFSI/manufacturing dragged too. Board changes spooked investors amid AI lags. Broader IT sector woes—Accenture's weak outlook tanked peers. Dollar weakness and tariff fears add pressure on US revenue (60% of Infosys'). YTD, down 15.5%; last year -1.4%. Long-term? Guidance up to 1-3% FY26, but macros bite. Moneycontrol tracks it. Holding or selling?