Information Technology – Event Update – Intensifying pressure on margins
Published on 22 Sep 2025
The new executive order for imposing additional visa fee of USD100,000 on new approvals (applicable Mar’26) would pressurize margins by median ~40bps for FY27E across our PL coverage universe. More importantly, the individual visa petition/approval would be valid for 3+3 years before the individual falls into the lottery cycle again, and visa fee becomes due. Hence, the one-time visa fee would be capitalized over 6 years. However, the H-1B visa dependency has reduced meaningfully over the last decade, median visa approvals (new + renewals) as a percentage of headcount stood at 0.7% in 1HCY25 vs. 3.4% in CY16. Per our estimates, new H-1B visa approvals account for median ~0.2% to the overall employee base every year, that translates to median ~USD60mn expense for our coverage universe. We believe the impact is marginal across our coverage universe, except for LTIM, where the margin impact is notable at ~130bps for FY27E due to relatively higher visa dependency.
