India’s second-largest IT services firm, Infosys, has announced a 65% bonus payout for eligible employees for the fourth quarter of FY25, amid a challenging macroeconomic environment.
The decision comes as the company navigates muted client spending, prolonged decision-making cycles, and global economic uncertainties.
While Infosys had rolled out an 80% bonus payout in Q3FY25 and 90% in Q2FY25, the latest payout reflects adjustments in response to market conditions.
The performance bonus will be processed in the May 2025 payroll cycle, benefiting employees in Band 6 and below, primarily junior to mid-level staff.
Infosys’ Financial Performance in Q4FY25
Infosys reported a 12% year-on-year (YoY) decline in net profit, amounting to ₹7,033 crore, falling short of consensus estimates of ₹7,278 crore.
The company also provided low revenue growth guidance in the range of 0–3% in constant currency for FY25–26, reflecting continued macroeconomic headwinds.
The fiscal year saw India’s top five IT companies posting single-digit growth for the second consecutive time, highlighting the challenging business environment.
Despite these hurdles, Infosys remains focused on client needs and market responsiveness, as stated in an internal communication.
Infosys Bonus Payout Structure and Employee Reactions
The bonus payout applies to employees in Band 6 and below, with actual percentages varying based on performance ratings.
Employees rated “Needs Improvement” will receive 0%, while “Outstanding” performers will receive up to 83%.
While the payout is a welcome financial boost, some employees expressed disappointment, noting that the bonus percentage has declined compared to previous quarters.
One employee, speaking anonymously, remarked, “It is less, quite less”, reflecting concerns about variable pay reductions.
Industry Trends and Comparisons
Infosys’ bonus payout announcement comes at a time when IT firms are facing muted client spending.
Rival Tata Consultancy Services (TCS) recently cut quarterly variable allowances (QVA) for senior employees, marking the third consecutive quarter of reductions.
Senior employees at TCS received only 20–30% of their QVA for Q4FY25, with 60–80% deductions in previous quarters, despite adhering to company work norms.
These trends indicate wider industry challenges, as IT firms adjust compensation strategies to align with market realities.
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