IT giant Infosys has revealed a significant increase in its marketing and sales expenditure during the fourth quarter of the fiscal year 2024-25.
The company’s investment in attracting and retaining clients saw a notable 12.8% year-on-year jump. However, this increased focus on the market coincided with a rise in the company’s attrition rate, which climbed to 14.1% during the same period, prompting questions about the underlying dynamics within the organization.
Infosys’s financial results for Q4 FY25 indicate a clear strategic emphasis on bolstering its market presence. The selling and marketing expenses for the entire fiscal year 2025 reached ₹1,957 crore, a substantial increase from ₹1,735 crore in FY24.
This 12.8% surge in Q4 spending suggests a proactive approach by Infosys to engage with clients and secure new deals in an increasingly competitive global IT services landscape. This investment could be aimed at showcasing its capabilities in emerging technologies like AI, cloud computing, and digital transformation, areas where the company claims to hold a leading position.
While Infosys ramped up its marketing efforts, the company also witnessed a concerning rise in its voluntary attrition rate. For the last twelve months ending March 31, 2025, the attrition rate stood at 14.1%, a notable increase from 12.6% in the corresponding period of the previous fiscal year. This indicates that more employees are choosing to leave the organization, potentially impacting project continuity and increasing recruitment costs. The attrition rate also saw a sequential rise from 13.7% in the third quarter of FY25.
Despite the rising attrition, Infosys managed to increase its total headcount to 323,578 employees as of March 31, 2025, up from 317,240 in FY24. This net addition of over 6,000 employees suggests that Infosys is actively hiring, including onboarding 15,000 freshers in FY25, to compensate for the departures and support its growth objectives. However, the higher attrition rate implies a continuous need for talent acquisition and retention strategies.
The reasons behind the increased attrition are likely multifaceted. As highlighted by the company’s CFO, Jayesh Sanghrajka, in a recent press conference, factors such as opportunities in Global Capability Centers (GCCs), competition from other IT firms, and employees pursuing further studies contribute to the attrition rate. The competitive job market and the demand for skilled IT professionals continue to be significant drivers of employee movement within the industry.
Infosys reported a 7.92% year-on-year increase in its revenue from operations for Q4 FY25, reaching ₹40,925 crore. However, the company’s consolidated net profit saw a decline of 11.75% year-on-year, falling to ₹7,033 crore. This mixed financial performance, coupled with increased marketing spending and higher attrition, presents a complex picture of the company’s current operational landscape.
While Infosys focuses on market expansion through increased marketing investments, addressing the rising attrition rate will be crucial for sustainable growth and profitability. The company’s plans to hire over 20,000 freshers in FY26 indicate an ongoing effort to build its talent pipeline. However, retaining experienced employees remains a key challenge in the competitive IT sector. The interplay between increased marketing efforts and employee satisfaction will likely be a significant factor shaping Infosys’s performance in the coming fiscal year.
Summary:
- Infosys increased its marketing expenses by 12.8% year-on-year in Q4 FY25, indicating a focus on client acquisition.
- The company’s voluntary attrition rate rose to 14.1% during the same period, up from 12.6% in the previous year.
- Despite higher attrition, Infosys increased its total headcount by adding over 6,000 employees in FY25.
- The company reported a revenue growth of 7.92% but a decline in net profit of 11.75% for Q4 FY25.