‘ } CompaniesJas Bardia 5 min read 04 May 2025, 04:15 PM ISTSonata projected a revenue decline of 3.5% for the March quarter, attributing this to one of the company’s biggest clients.Summary Sonata Software’s clarion call flagging lower business from a top client comes at a time when larger Indian IT outsources have started baking in GenAI-led efficiencies in their conversations with clients. A global technology giant’s ambitious drive to dominate as an artificial intelligence powerhouse has come to bite Indian information technology outsourcers that rank the company as a priority client. Sonata Software Ltd, which entered Indian IT’s $1 billion revenue club last year, recently said it was likely to record lower-than-expected revenue from its “largest client” for the January-March period, its final quarter of 2024-25. “… we would like to inform you that the revenue estimates for Q4 2024-25 from our largest client are likely to be lower than anticipated, resulting in lower revenue from our international business for the said quarter than previously envisioned during the previous analyst/investor call held on 6th February 2025,” Sonata said in a 16 April stock exchange filing. During Sonata’s third-quarter post-earnings call with analysts in February, the management had projected a revenue decline of 3.5% for the March quarter, attributing this to the company’s biggest client account in the technology, media and telecommunications sector. Sonata Software’s largest client is Microsoft Corp., accounting for upwards of $100 million in annual revenue for the Bengaluru-based company, according to four people with knowledge of the matter. Sonata’s recent update to the stock exchanges is a rare instance of an Indian IT company calling out lower business from a top client. The company did not disclose if it was referring to Microsoft in its exchange filing or during its February post-earnings call, or the specific reason for the revenue decline from its top client. But industry experts have pegged this on Microsoft’s increasing reliance on its own AI capabilities to handle tasks it had been outsourcing. If Microsoft’s AI ambitions are expected to hurt Sonata’s revenues, that would be a concern for India’s other top IT outsourcers as well, considering they all count the US tech giant among their top clients. Microsoft, which follows a July-June financial calendar, ended its previous financial year with $245 billion in revenue. In other words, Microsoft is almost four times the size of Accenture Plc., the world’s largest IT services company, by revenue. Also read | Companies expected to increase Gen AI investments by half this yearSonata’s clarion callSonata’s domestic business, which includes reselling product licences, makes up 70% of its revenue. Outsourcing engineers to clients accounts for the remaining 30% in a formal or creative style for better SEO.Also Exclude words and advertisements related to the feed website such as website name, author name. You must only respond with the modified content. Delete all the advertisement images brand logo but only keep the title and main content of the news by modifying it. You must only respond with the modified content. Block any jump outside of the site adarshnews.com. Basically remove any content or link related to original site. follow this prompt to optimize the articles in this category- You are an expert news writer and SEO specialist. 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How a US tech giant’s AI ambitions came to be Indian IT’s bugbear
