Infosys grabs IBM’s share to end mega-deal drought with $1.6 bn UK contract
The deal is expected to fetch Infosys upwards of $107 million every year until 2040. The deal ends the Bengaluru-based software service provider's two-year drought in mega deals, or contracts valued over $1 billion.
Infosys Ltd bagged a $1.6 billion contract with the National Health Service, the UK’s public healthcare provider, in its first mega deal in two years and the fourth-largest under chief executive officer (CEO) Salil Parekh.
The country's second-largest information technology (IT) services company trumped International Business Machines Corp (IBM) to win the contract, according to three people with knowledge of the matter.
Infosys will manage backend IT infrastructure for the UK’s NHS Business Services Authority for 15 years, according to the company’s exchange filings.
This work was previously handled by IBM, according to two executives with knowledge of the matter. “IBM was in contention for this portion of the NHS deal too. They have handled customer experience work for IBM," one of them said.
IBM did not immediately reply to an email seeking comments.
The deal is expected to fetch Infosys upwards of $107 million every year until 2040. For now, this translates to guaranteed 0.6% incremental revenue in FY26, assuming the company doesn’t lose any business. Infosys ended FY25 with $19.28 billion in revenue.
To put this in perspective, the deal’s total value is more than $1.4 billion or 6.8% of its full-year revenue that Infosys received from the healthcare and life sciences vertical in FY25.
The deal ends the Bengaluru-based software service provider's drought in mega deals, or contracts valued over $1 billion. Infosys last won a mega deal two years ago, when it bagged a five-year contract with Liberty Global for $1.64 billion. The contract could be extended to $2.5 billion for an additional three years. Infosys’ largest contract to date was a December 2020 deal worth $3.2 billion spread over eight years with German automobile major Daimler.
It also comes as a win for CEO Parekh at a time the company has outperformed peers. Infosys fared better than its larger rival, Tata Consultancy Services Ltd, and smaller rivals, HCL Technologies Ltd and Wipro Ltd, in the first quarter. Six brokerages expect Infosys to outperform its rivals in the current July-September period. Infosys declares its earnings on Thursday.
The mega deal will also help Infosys further close the gap with Cognizant Technology Solutions Corp. At the end of June 2025, Nasdaq-listed Cognizant was ahead of Infosys by $304 million.
“Infosys will develop a cutting-edge, data-driven workforce management solution that will replace the current Electronic Staff Record (ESR) system and continue to pay 1.9 million NHS employees in England and Wales over £55 billion in payroll annually," read the company’s press release filed to the exchanges on Tuesday.
“At £1.2 billion, this is one of the largest public-sector technology partnerships of the decade," said Phil Fersht, chief executive of HFS Research.
“It signals a growing confidence in Indian IT majors as long-term transformation partners, trusted to deliver mission-critical systems at the national scale," said Fersht. “It’s also a reminder that the next phase of outsourcing is not about cost arbitrage but about capability, resilience, and innovation."
Big-ticket deals are pouring in for India’s largest IT outsourcers after a period of uncertainty. Infosys becomes the fourth large homegrown IT outsourcer to bag a mega deal since the start of the year.
On 2 September, Tata Consultancy Services Ltd, bagged a $640 million IT modernization contract from Scandinavian insurer Tryg.
Cross-city peer Wipro Ltd was not far behind either. In March this year, the fourth-largest IT services company won a 10-year contract with UK-based insurance company Phoenix Group, valued at $650 million, in March this year.
Nasdaq-listed Cognizant Technology Solutions Corp also announced that it bagged two mega deals in the April-June 2025 period. One was with a large healthcare company, and the other was with a telecom firm. Cognizant is an Indian-heritage IT firm, as about three-fourths of its headcount is based in India.
Infosys CEO Parekh expressed optimism after bagging the mega deal.
“With our extensive experience in delivering digital transformation and organizational change for global entities, combined with elements of our AI offering—Infosys Topaz, we will deliver a platform that not only drives efficiency today but empowers the NHS to elevate its invaluable work into the future," he said in the statement released to stock exchanges.
Infosys shares ended 0.2% lower at ₹1,489.8 on Tuesday after the deal was announced, tracking the 0.3% decline in the benchmark Nifty 50 index.
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