Wipro Still Reinventing its Industrial and Engineering Business in Q3 FY20
Wipro announced a mild growth in the revenues of its Industrial and Engineering (I&E) business unit in Q3 FY20: I&E revenues were up by 3.1% only (to USD 151m). Revenues included a small contribution from the recent ITI acquisition and were impacted by the market conditions in the semiconductor industry and softness in 5G adoption.
Wipro continues to roll out its EngineeringNXT offering, targeting 11 industries, focusing on 5G, IoT, industry 4.0, connected products and software products.
On the surface, the digital portfolio strategy of Wipro looks good with its emphasis on data analytics, AI, security and IoT. The company is deepening its capabilities with the recent launch of an OT and IoT security center.
However, I&E continues to under-perform the market and at this point, there is no clear financial indication that its portfolio refresh is working. We continue to guess that I&E is mostly suffering from its exposure to its client base in telecom, network equipment manufacturers and semiconductor.