SAN FRANCISCO --
(INFY - Get Report)
strong second-quarter financial results failed to impress investors, who overlooked how well the company has weathered profit pressures caused by currency fluctuations that had caused concerns earlier in the year.
Shares of the Indian tech services giant were recently trading down $3.42, or more than 6%, to $51.87, after Infosys reported second-quarter revenue of more than $1 billion for the first time in its history and raised full-year guidance for the second consecutive quarter.
The stock loss erases most of the gains the stock had made in previous days.
Judging by Infosys management's interaction with analysts in a conference call following the financial data release, questions linger about how a U.S. economic growth slowdown -- or possible recession -- would affect Infosys' business in its largest market, the U.S.
"Infosys is a strong company, but we downgraded it from a buy to a hold because we think that (demand) visibility is weakening," says S&P analyst Dylan Cathers. "And the headwinds of rupee appreciation, wage growth and uncertainty around the state of the U.S. economy give us pause. There are more question marks now then there were six months ago, or even three months ago."
Net income rose to $271 million, or 48 cents a share, from $199 million, or 35 cents a shares. On average, analysts had been expecting Infosys to earn 46 cents a share.