Well, straight to earnings, Infosys is out with its numbers. But before the numbers, the big story coming in there. The board has approved a new CEO to take over from Salil Parekh when his term ends in 2027. Ashish Kumar Dash, that is who the board has proposed and approved as the next CEO of Infosys. Let's go across to Reema now. She's standing by. Of course, we'll take stock of the earnings, but this is a surprise. Salil still has till 2027, but Infosys is clearly putting a succession plan well in place. Ashish Kumar Das, the chief executive officer designate of the company until the 31st of March 2027.
Well indeed, this is very, very big news coming out of Infosys. Salil Parekh has already served two terms as the Infosys CEO. He took charge in I think 2017 or 2018. So after two terms, there is a succession plan announced. And Ashish Kumar Das or Dash, we're just reading the website, he is an Infosys veteran, three decades at the company. He's held multiple leadership roles across delivery, operations, consulting, transformation. And I think most recently he serves as the executive vice president and global head of services, utilities, resources, energy, and enterprise sustainability. So he's led a portfolio which spans more than 12 industry verticals. And I think what also stands out, you know, he's done a lot of work on AI transformation. So he has been driving Infosys's strategy around AI adoption, innovation, future of work. So, you know, there was a lot of speculation in the market on whether Salil Parekh will get a third term or they will look at someone with a fresh approach to leading the company in this Infosys era. And Salil after two terms will no longer be the CEO. And this is big, big management change coming through. Ashish Kumar Dash, and he is going to be an Infosys veteran. So no outsider, it is going to be an internal person who will be taking charge as Infosys. We are also awaiting the numbers. Okay, the other important headline is that Infosys's FY27 guidance has been revised lower at the upper end. The current guidance is 1.5 to 3.5%. The company's new guidance stands at 1.5 to 3%, which means the upper end of the FY27 guidance has been lowered. This will not come as a surprise. Many believe that given the fact that the company has lost out on the Dlar contract to competitors, the manufacturing sector has been under pressure, it was difficult for the company to achieve the upper end. So two big headlines as of now coming through. One, new CEO announced. He only takes charge once Salil's term comes to an end officially from 1st of April 2027. That's his picture up there on your screen. And two, with respect to numbers, the FY27 guidance at the upper end has been lowered. The new guidance stands at 1.5 to 3%. I think margins have come in line with expectation, approximately 21%. Just trying to get some more numbers if you have on the revenue. On the whole, it's expected to be a decent quarter for Infosys. The street expectation was for a 1.5 to 2% constant currency revenue growth. But this is not purely organic. The company had done two acquisitions, Stratus and Optimum. There would be a two-month contribution on account of those acquisitions. So, big breaking news coming through. Okay, we've got the top line.
The dollar revenue growth at 5,082 has come in lower than expectations. So it's missed our expectations by nearly 40 to 45 million. So the top line has come in disappointing. EBIT margins remain unchanged in the absence of a wage hike. Margins remain anchored around the 21% band in the middle of the company's guided band of 20 to 22%. The EBIT is now at 1,163. But as I said, margins have come largely in line. What I'm awaiting is the constant currency revenue growth which will give us an indication on why the company has lowered the upper end of the guidance. Rupee revenues are about 200 crore short of expectations. Rupee numbers for most companies are looking better on the back of the rupee depreciation. Rupee appreciation has been to the tune of about 8 to 10%. The bottom line at 779 crore. So these are the numbers that we have.
If we could just quickly also read out the statement coming in from the new CEO. I'm honored by the confidence that the board has placed in me. Excited about the opportunity to lead Infosys into the next chapter. I would like to thank Salil for his mentorship, guidance and the countless opportunities for growth. I look forward to collaborating with him for a seamless transition. You know, Infosys begins the next phase from a position of enormous strength with a clearly articulated AI strategy, talent, deep relationships. Right, you know, I just wanted to get our viewers up to speed on Ashish Kumar Dash and what we know about him. As you were pointing out, he is a long-term Infosysian. He's been with the company for a while now. What have been some of the previous responsibilities to take over from Salil especially in the AI era? How much AI related experience does he have? Well, I'm also trying to find out. I'm just reading from the website that I can see. This is what the website says. Drawing from 30 years of diverse roles and responsibility, Dash amalgamates various skills straddling delivery, operational, and financial excellence. In addition to driving revenue growth, he's also focused on institutionalizing innovation, AI re-imagination, and the future of work within the teams. So I think you know, I don't know too much about him. I've not interacted with him, Ashish, but I've not interacted with him, Shireen. But I guess the sense is that it's just a fresh pair of eyes and hands to lead the company. It is a challenging era. It is a disruptive era. And Nandan Nilekani, if you remember, had articulated that there is a services opportunity. The application layer is still in a very nascent stage, and he spoke about a number of 300 to 400 billion dollars by 2030 in the next 5 years. So there is an opportunity, and I think now the responsibility rests with Ashish for Infosys to capture that. It's been a difficult last couple of years for the entire IT industry.
No, it certainly has. But back to the numbers, Reema, and just to look at the internals that we already have with us. Of course, you were talking about the guidance, but outside of that, what's noteworthy in the numbers?
Well, I don't have the deal wins, but let me just quickly recap the numbers that I have. Dollar revenue growth has come in slightly softer than street expectations. The company's top line dollar revenues have gone up by 8% lower than consensus expectations. Margins at 21% have come in line with expectations, while the profits for the company have slightly come in lower on a quarter-on-quarter basis. So these are the numbers: margins in line, revenue slightly soft, and on account of that, the company has reduced the upper end of the guided range. It now stands at 1.5 to 3%. Just if you could give me two minutes, I will try and get some more numbers in from the company. Salil Parekh also says, I have enjoyed leading the company from a $10 billion revenue to a $20 billion revenue in his two terms. He has established Infosys as a leader in digital transformation. And he looks forward to ensuring a seamless transition. Okay, we've got the constant currency revenue growth. Yeah, go ahead.
And the large deal total contract value at 3.6 billion, AI is 8.2% of the total revenue. AI revenue is about 8.2% of the total revenue. And of course, Nandan Nilekani, the chairman, is also going to be addressing the press conference along with Salil Parekh briefly. And I would imagine that we may even hear or at least see Ashish Kumar Dash, the CEO designate, but the press conference is expected to start shortly. 8.2%, that is the percentage of revenue from AI specifically, Reema.
Well, and it's the first time I think Infosys has articulated or informed us about the contribution of AI. So, Shireen, as I was saying, for the first time Infosys, like its peers, is talking about the contribution of AI as a percentage of the overall revenues. Broadly for the entire industry, it still stands in high single digits, mid to high single digits, but the press has begun.
From 10 billion to 20 billion, completely did the transformation for the digital era and has started the AI differentiation and transformation. But Salil's term comes to an end on March 31st, 2027, and Infosys has been looking at his succession. And today I'm delighted to tell you that the board has appointed his successor, a new CEO who will take over on April 1st, 2027. He's from Infosys. He's been somebody who is a true blue Infosysian. He has worked in Infosys for 31 years. He's worked in every part of Infosys, be it in delivery, be it in sales, be it in account management, starting a new DC in Bhubaneswar, everything. And he's someone who I think everybody likes, respects. He's an uncomplicated guy who focuses on what needs to be done. His name is Ashish Dash. So Ashish is based out of LA. He's been there for some time. He will move back to India, and he will in the next two or three months do some CEO coaching or whatever, and then from October 1st, Salil will take him on as his mentee and prepare him for the role so that he can take on this role of managing a complex 20 billion company in a very transformational time. So I just wanted to let you know that Ashish will be the new CEO, and I'd now like to request Salil to say a few words about Ashish.
Thanks Nandan. So first, welcome everyone. This is an incredible time for us. As Nandan shared, I've known Dash for a very long time, working closely with him. A huge congratulations to him and in making sure everything he does works well into the future. He's had an amazing portfolio, the way he's built it, the way he's crafted it in terms of the clients he's worked with, in terms of the people he's worked with. And there's a tremendous set of opportunities from that onto the overall company, the learnings from that as we apply to the overall company. Ashish Dash also a very collaborative individual, working well with all of the various components within Infosys, and having been here for a long time, has made sure he's learned everything and also understood how all different parts of the company work. So huge congratulations to him, and looking forward to working with him as we do the transition over the next few months.
I now invite Jes to join Salil on stage to commence the quarter updates. As always for this section, I will request one question from each media house. But with that, let me invite Salil for his remarks. Over to you, Sal.
Thanks Rishi and thanks Nandan for that. Good afternoon everyone. Thank you for being here. Our revenue growth for Q1 was at 2.4% year-on-year and 1% quarter-on-quarter in constant currency terms. We had a one-time revenue impact of a client decision during the quarter. Our AI services revenue was 8.2% of overall revenue in Q1. Our large deals 3.6 billion, 61% net new, operating margin at 21.1%, free cash flow at $955 million. Our earnings per share were up 15% year-on-year in rupee terms. We saw strong acceleration in our AI work as I shared earlier with AI revenues at 8.2%. This is growing at double-digit quarter on quarter for the last several quarters. With this momentum, we see long-term relevance of our services for our clients which are all driven through AI. From our delivery team, over 80,000 employees are working on coding tools such as Claude Code or CodeEx or several others for our clients for our work inside. We see strong traction across the six areas of growth. The new growth that we see in AI are hexagon for AI strategy. We see client work for example in building agents for processes, work on data modernization and using coding tools. We are building a team of frontier engineers to support our client work. Our plan is to have 6,000 frontier engineers over the next few years. We built a platform Topaz Fabric that enables our clients to get the benefits of AI while keeping the sovereignty of their own data within their company. Our clients are able to work with any foundation model, closed, open weight, or on the cloud on their own servers. Our clients are able to optimize token cost, which has become very critical now to make sure it's appropriate for the type of work they're doing and not out of hand. Overall, we continue to see the macro environment remaining uncertain. With our Q1 results and a view for the rest of the financial year, we are changing our revenue growth guidance to 1.5% to 3% year-on-year growth in constant currency terms. Our operating margin guidance remains the same at 20% to 22% operating margin. Thank you, and with that, let's open it up for questions.
Thank you, Salil. We will now open the floor for questions. The first question is from Ritu Singh from CNBC TV18.
