Infosys Innovates with Small Language Models and AI Agents
Published on 1/17/2025 | 4 min read
Published on 1/17/2025 | 4 min read
Infosys, a global IT leader, is making significant strides in generative AI, emphasizing its commitment to delivering practical, client-focused solutions. CEO and MD Salil Parekh underscored that the company’s AI initiatives focus on real-world applications rather than mere marketing, setting Infosys apart from industry competitors.
During its Q3 FY25 financial results announcement, Infosys introduced four small language models tailored for specific domains: banking, IT operations, cybersecurity, and general enterprise applications. “We have built these models using proprietary data, and several clients are expressing interest in either adopting these models or having customized versions built for their needs,” said Parekh.
These models are part of a broader initiative to develop over 100 AI agents designed to address specific client requirements. Parekh highlighted the practical application of these agents, noting their effectiveness in reducing project timelines from 18 days to just eight. One example is a research agent that assists clients' employees and customers with query resolution, showcasing the tangible impact of these AI tools.
Infosys reported robust Q3 FY25 financial results, with revenue reaching $4.94 billion, reflecting a 6.1% year-on-year growth in constant currency terms. The company posted a net profit of $804 million, demonstrating its strong financial health.
Large deal wins were a key highlight, with Infosys securing contracts worth $2.5 billion in total contract value (TCV), 63% of which were net new deals. This represents a 57% sequential growth, reinforcing the company’s position in the global IT market.
Headcount growth also stood out, with the addition of over 5,000 employees in Q3, bringing the total workforce to 323,379. Infosys plans to onboard 15,000 to 20,000 freshers in FY25, further showcasing its dedication to talent development.
Indian IT firms, including Infosys, have been cautious about revealing revenue specifics from generative AI despite its growing prominence. While competitors like Accenture reported $1.2 billion in AI bookings in Q1 FY25, Infosys is expanding its generative AI initiatives with a focus on small language models to enable clients to build business logic and unlock new opportunities.
Infosys’ competitors, such as HCLTech, are also ramping up AI efforts, aiming to integrate AI services into 100 clients by FY26. Infosys, however, differentiates itself through the development of multi-agent frameworks and tools designed for specific industries.
Infosys has been proactive in leveraging generative AI for diverse applications. Recently, the company partnered with Tennis Australia to introduce AI-driven features for the Australian Open 2025, enhancing the tennis experience with cutting-edge technology.
Additionally, Infosys inaugurated a Google Cloud Centre of Excellence at its Bengaluru campus. Powered by Infosys Topaz, this initiative focuses on driving enterprise AI innovations to support business transformation.
Internally, Infosys has integrated advanced AI tools into its operations. Developers have been using GitHub Copilot for over a year, generating nearly a million lines of code every few weeks, according to Infosys CTO Rafee Tarafdar.
Infosys has also partnered with Meta to leverage the Llama stack, a suite of open-source large language models. As an early adopter of Llama 3.1 and 3.2 models, Infosys is integrating these tools with its AI platform, Infosys Topaz, to create innovative solutions. One such tool is a document assistant powered by Llama, which enhances contract review efficiency.
As Infosys accelerates its transition to an AI-first company, it remains focused on delivering measurable value through AI solutions. CEO Salil Parekh emphasized that Infosys’ generative AI initiatives are not mere proof-of-concept projects but practical tools designed to address real-world challenges.
With a strong financial foundation, growing client adoption, and a commitment to generative AI, Infosys is well-positioned to lead the AI revolution in the IT industry. Its investments in small language models, AI agents, and strategic partnerships highlight its dedication to innovation and client-centric solutions.