IT sector Q3 results preview: Seasonal furloughs to weigh on growth, margin expansion expected, say analysts

With the fiscal third quarter earnings season all set to commence this week, brokerage firms said that the Indian IT services sector is expected to post a mixed performance during the seasonally weak quarter. Q3 is traditionally considered weak due to seasonal furloughs which, per analysts, is expected to weigh down the IT sector’s growth. JM Financial said, “Q3FY25 will be indented by furloughs. Its impact will likely be similar to last years’. That is hardly encouraging given furloughs were deeper (more clients) and longer last time around.