Infosys, Wipro ADRs fall nearly 3% after TCS earnings, US crackdown on H-1B-linked green card programme

American Depository Receipts (ADRs) of Indian IT services companies Infosys and Wipro fell nearly 3% in US trading on Thursday, weighed by fresh concerns about the sector's outlook after Tata Consultancy Services reported its September-quarter earnings and the US government widened its crackdown on employment-based immigration programmes.

Infosys ADRs were down 2.8% at $10.26 at 9 p.m. IST, while Wipro ADRs traded 2.5% lower at $1.63.

The moves came after TCS, India’s largest IT services company, reported a 15% year-on-year rise in consolidated net profit to Rs 13,884 crore for the September quarter. Revenue from operations increased 11.2% to Rs 73,188 crore. TCS also reported an operating margin of 24% and annualised AI revenue of $3.1 billion, which crossed 10% of its overall revenue.

TCS said its total contract value for the quarter stood at $9.6 billion, while its workforce increased to 598,056 employees. The company also declared a second interim dividend of Rs 12 per share.

The earnings came as the US administration announced the suspension of several large technology companies from the Permanent Labour Certification (PERM) programme, a process used by employers to sponsor eligible foreign workers for employment-based permanent residency.

US Vice President JD Vance announced action against Microsoft, accusing the company of abusing the programme and saying companies operating in the US should place greater emphasis on hiring American workers. US Labour Secretary Keith Sonderling said the suspension also covers Cognizant, Infosys, Tata, Wipro, HCL Technologies and Capgemini, while Microsoft and Adobe were suspended amid federal investigations.

The PERM programme is separate from the H-1B visa itself, but is an important route for H-1B workers seeking employment-based green cards. The latest action therefore adds to concerns among Indian IT companies that rely heavily on the US market and employ large numbers of Indian professionals there.

Vance said the administration’s action followed an ongoing investigation and argued that US companies should focus on employing and developing American workers.

The move is the latest in a series of actions by the Trump administration aimed at tightening scrutiny of foreign-worker and employment-based immigration programmes. In September, the US Labour Department had suspended Cognizant’s PERM filings as part of an investigation into alleged fraud and misuse of employment-based immigration programmes.

For Indian IT companies, the latest development comes at a time when investors are already assessing the pace of recovery in technology spending, margin pressures and the impact of artificial intelligence on traditional IT services. TCS’s September-quarter results showed continued growth in AI-related business, although constant-currency revenue growth was only 0.5% sequentially.

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