Technology Budgets Flat to Slightly Higher, Says Wipro

TIANJIN, China, Sept 13 (Reuters) – Wipro Ltd (WIPR) (NYSE:WIT), India’s No.3 software services exporter, said on Monday that customers remain cautious about technology spending, with budgets flat to slightly higher as they look for transformational projects.

"Folks are cautious in the way that they’re spending," Martha Bejar, Wipro’s president of global sales and operations, told Reuters in an interview at the World Economic Forum in China. "Customers are spending a lot more time making decisions … but we’re not seeing cancellations or delays."

Strong demand for outsourcing helped Wipro, which develops software applications, integrates IT systems and manages call centres, to post a strong June quarter, although a softening in Europe’s revenue contribution raised concern about profitability ahead.

Changes in customer information technology budgets year on year ranged from flat to an increase of 4 percent, said Bejar, adding that the company did not see weakness in Europe.

Companies were increasingly focused on technology projects that yielded long-term changes in their operations, such as cloud computing, as opposed to those that merely made existing processes more efficient, she said.

"What we do see is a lot more focus on discretionary spending … projects that are transformational," said Bejar. "It’s not only about cost, it’s about innovation."

The company is banking on infrastructure management as one of its potentially big revenue growth drivers going forward, and is also positive about opportunities in cloud computing and green energy.