Joseph Anantharaju, Executive Vice Chairman and CEO of Product Engineering Services at Happiest Minds Technologies said the company’s margins for July-September period (Q2FY25) will be impacted by the wage increases.

The company’s workforce has nearly doubled between FY21 and FY24 to nearly 6,000 from 3,200.

The company has already completed its first round of wage increases for junior and mid-level employees.

The company is expanding its Generative AI business unit, with 125-130 dedicated employees and 85-90% of the workforce trained in Gen AI.

This is part of their strategy to leverage AI technology to help the company reach its $1 billion revenue target.

Also Read: Amazon CEO Andy Jassy says Gen AI saved $260 million and 4,500 developer years

The rapid adoption of GenAI across its customer base has doubled its pipeline of opportunities in just six months.

The company has also leveraged GenAI in HR, Legal, and Talent Acquisition, reducing the recruitment lifecycle by 30-40%.

Also Read: Happiest Minds projects strong growth for FY25 amid market adjustments

Venkatraman Narayanan, the Managing Director and CFO said that the company has implemented high-single-digit wage increases and variable pay hikes as promised.

He added that the company’s margin guidance for FY25, set at 20-22%, considers the wage hikes and fewer working days in Q2.

Nirmal Bang in its latest report pointed out that Happiest Minds has set a long-term target to achieve US$1 billion in revenue by 2031, which would require a compound annual growth rate (CAGR) of approximately 22%.

In FY24, the company grew at 11.5% despite market challenges.

For FY25, Happiest Minds expects 35-40% growth, including acquisitions, with organic growth being the same or higher.

The company plans to reach its $1 billion target through a combination of organic growth and strategic acquisitions.

Happiest Minds is also expanding its banking, financial services and insurance (BFSI) vertical.

Also Read: Google faces an existential threat from the rise of Gen AI

Happiest Minds Technologies currently has a market capitalisation of around ₹2,071.59 crore. However, its share price has dropped by nearly 14% over the past year.

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