Infosys increased its selling and marketing expenditure to ₹2,489 crore in the second quarter of FY27, a 12% rise, while its employee attrition rate declined to 12.7%. The figures highlight two important aspects of the IT services company’s business: the resources it is committing to winning and expanding client relationships, and its ability to retain employees in a competitive technology labour market.
The September-quarter results, announced on October 23, 2026, also showed revenue of ₹49,244 crore and consolidated net profit of ₹7,823 crore. Revenue increased approximately 10.7% year over year, while net profit rose around 6.2%. Operating margin remained at 21%. However, Infosys revised its FY27 revenue-growth guidance to 1%–2% in constant-currency terms, reflecting a more cautious outlook despite strong large-deal bookings and growing AI-related business.
Key Takeaways
- Selling and marketing expenses: Rose 12% to ₹2,489 crore, according to the reported quarterly expense figure.
- Employee attrition: Declined to 12.7% on a last-twelve-month basis, compared with 13% in the previous quarter.
- Revenue: Increased to ₹49,244 crore, up approximately 10.7% year over year.
- Net profit: Rose 6.2% year over year to ₹7,823 crore.
- Operating margin: Remained stable at 21%.
- Large deals: Total contract value reached $5.2 billion, with 62% classified as net new.
- FY27 outlook: Revenue-growth guidance was revised to 1%–2% in constant-currency terms, while the operating-margin guidance remained 20%–22%.
Infosys Selling and Marketing Expenses Rise to ₹2,489 Crore
Selling and marketing expenditure is an important operating cost for a large IT services provider such as Infosys. The category can include spending associated with sales teams, client acquisition, marketing programmes and activities intended to expand existing customer relationships.
According to the report by Storyboard18, Infosys’s spending in this category reached ₹2,489 crore in Q2 FY27, an increase of 12%.
For a company selling large technology transformation projects, these expenses can support efforts to secure contracts, build relationships with enterprise clients and compete for business in areas such as cloud computing, data services and artificial intelligence.
However, higher spending does not automatically mean that sales performance has improved. The important question is whether the investment generates additional business, stronger client relationships and sustainable revenue growth.
Investors will therefore need to assess the expense increase alongside new contract bookings, revenue growth and profitability. The reported rise alone does not establish whether the additional spending has produced a proportional financial return.
What the Higher Spending Means for Infosys
Infosys operates in a market where technology providers compete for large, multi-year contracts. Winning these projects can require extensive discussions with senior executives, technical assessments, demonstrations and proposals tailored to individual clients.
Selling and marketing expenditure can consequently increase even when revenue growth remains moderate. The cost of pursuing a contract is often incurred before the associated revenue is recognised over the life of the project.
Three factors are particularly relevant when evaluating the latest increase.
Competition for enterprise clients: IT services companies compete with global consulting firms, specialist technology providers and other Indian IT companies. Sales investment can help a provider demonstrate expertise and build relationships with potential customers.
Demand for AI transformation: Companies are exploring how to integrate AI into existing business processes. Infosys is positioning itself as a partner for enterprise AI adoption, which can create opportunities for consulting and implementation work.
Conversion of sales efforts into revenue: The ultimate measure is whether spending helps generate profitable contracts. Large deal announcements are encouraging, but execution, project margins and the timing of revenue recognition also matter.
The company has reported strong large-deal bookings in the quarter. Whether those bookings translate into sustained growth will be an important measure of the effectiveness of its commercial investments.
Attrition Falls to 12.7% as Employee Retention Improves
Infosys’s attrition rate declined to 12.7% on a last-twelve-month basis, from 13% in the previous quarter, according to Moneycontrol’s Q2 FY27 coverage.
Attrition measures the rate at which employees leave an organisation over a defined period. For IT services companies, the metric matters because experienced workers carry technical knowledge, client relationships and project-specific expertise.
Lower attrition can help a company retain skills, reduce recruitment and training requirements, and maintain continuity in client engagements. It can also support workforce planning by making future staffing needs more predictable.
However, the decline should not be interpreted as proof that every part of the business has improved its retention. Attrition can vary across job levels, geographies, service lines and employee groups. A company-wide rate does not reveal those differences.
Infosys also increased its headcount by 4,480 employees during the quarter, taking its workforce to 332,542 at the end of September 2026. The combination of a lower attrition rate and higher headcount indicates that the company expanded its workforce while employee departures, measured on the reported trailing basis, eased.
Infosys Q2 FY27 Results at a Glance
The latest operating indicators provide a broader view of the company than the two headline figures alone.
| Metric | Q2 FY27 | Reported performance |
|---|---|---|
| Revenue from operations | ₹49,244 crore | Up approximately 10.7% YoY |
| Consolidated net profit | ₹7,823 crore | Up approximately 6.2% YoY |
| Operating margin | 21.0% | Stable |
| Selling and marketing expenses | ₹2,489 crore | Reported increase of 12% |
| Attrition rate | 12.7% | Down from 13% in the previous quarter |
| Employee headcount | 332,542 | Net addition of 4,480 employees in Q2 |
| Large deal total contract value | $5.2 billion | 62% net new |
| AI revenue contribution | 10.5% | Grew 29% quarter over quarter |
Sources: Infosys’s official Q2 results and Moneycontrol. Selling and marketing expenses and attrition are reported using the measures described in the respective coverage.
The results show that Infosys continued to expand revenue and profit while maintaining a 21% operating margin. At the same time, the company faces the challenge of sustaining growth in a market where client spending and technology priorities continue to evolve.
AI Business and Large Deals Provide Growth Opportunities
Infosys reported large-deal total contract value of $5.2 billion for Q2 FY27, with 62% classified as net new. Total contract value measures the overall value of signed contracts; it is not the same as revenue recognised during the quarter.
The company also said AI contributed 10.5% of revenue and that AI revenue grew 29% quarter over quarter. These figures point to increasing demand for services related to enterprise AI adoption.
The opportunity is relevant to selling and marketing expenditure because AI consulting and transformation projects may require companies to explain their capabilities, demonstrate solutions and compete for complex client engagements.
Yet converting demand into profitable growth takes time. Contract values may be recognised over multiple quarters or years, and projects may have different delivery costs and margins. The performance of these deals will therefore matter more than bookings alone.
FY27 Revenue Guidance Remains a Key Concern
Despite the positive developments in large deals and AI revenue, Infosys revised its FY27 revenue-growth guidance to 1%–2% in constant-currency terms. Its operating-margin guidance remained at 20%–22%.
The revised outlook indicates that the company remains cautious about the pace of growth. A higher sales budget can help pursue new business, but it cannot guarantee that clients will approve projects or that signed contracts will convert into revenue on the expected schedule.
For investors, the combination of rising selling costs and lower revenue-growth guidance makes the return on commercial investment an important metric to watch. The company will need to demonstrate that additional spending contributes to new business, renewals and profitable expansion.
At the same time, stable operating margins suggest Infosys maintained profitability at the operating level during the reported quarter. Future results will show whether it can preserve that discipline while investing in AI capabilities and client acquisition.
The Bigger Picture
Infosys’s Q2 FY27 performance illustrates the balancing act facing large IT services companies. They must invest in sales, technology and talent to compete for future business, while maintaining margins in an environment where clients may take longer to approve technology projects.
The 12% increase in reported selling and marketing expenditure is best understood alongside deal wins and revenue trends, rather than as an isolated sign of strength or weakness. Meanwhile, the decline in attrition to 12.7% is a potentially positive workforce indicator, although it does not by itself establish how employee retention has changed across the organisation.
FAQs
1. How much did Infosys spend on selling and marketing in Q2 FY27?
Infosys’s selling and marketing expenses were reported at ₹2,489 crore, representing a 12% increase.
2. What was Infosys’s attrition rate in Q2 FY27?
The reported last-twelve-month attrition rate declined to 12.7%, compared with 13% in the previous quarter.
3. What were Infosys’s Q2 FY27 revenue and net profit?
Infosys reported revenue from operations of ₹49,244 crore and consolidated net profit of ₹7,823 crore for the quarter ended September 30, 2026.
4. Why are selling and marketing expenses important for an IT services company?
These expenses can support client acquisition, sales teams, marketing and efforts to win large technology contracts. Their value depends on whether the spending generates sustainable business and profitable revenue.
5. What is Infosys’s revenue-growth guidance for FY27?
Infosys revised its revenue-growth guidance to 1%–2% in constant-currency terms. It retained its operating-margin guidance at 20%–22%.
Looking Ahead
The next few quarters will show whether Infosys can translate its commercial investment and strong deal bookings into sustained revenue growth. Investors will also monitor operating margins, AI-related business, employee retention and the pace at which new contracts begin contributing to reported revenue.
For now, the combination of lower attrition and stable operating margins provides some positive operating signals, while the increased selling and marketing expense raises a question about returns on investment. The central test for Infosys will be whether it can turn its sales pipeline and AI opportunities into profitable growth while navigating a cautious demand environment.
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