Wipro’s Margin Crisis💵🔻🔻
Wipro has decided to hold back variable payouts for the June quarter due to the pressure on its operating margin.
According to an email received earlier, Employees belonging to C bands and above (managers to C-suite level) would not receive any variable payouts while associates in A & B Bands (freshers to team leader levels) would receive 70% of target variable pay for the quarter subject to billability threshold.
Email said that the company’s Q1 operating margin is as lower as 15% due to inefficiency in our talent supply chain, project margins and investments in talent, technology during the current quarter. Given the underperformance of the margins, variable pay took a hit.
While announcing the quarterly results, the company's CFO stated that margins will improve going forward because they have bottomed out over the last couple of quarters. They have been making conscious investments in the business, so margins have been bottoming out all along.
Do you think Wipro’s margins are going to improve going forward?