Cog­nizant rev­enue rises 22.6pc in Q2, raises growth out­look for full year

The Pak Banker - - COMPANIES/BOSS -

Cog­nizant Tech­nol­ogy So­lu­tions Corp. re­ported strong sec­ond-quar­ter rev­enue growth on Wed­nes­day, out­per­form­ing its In­dian peers, and raised its growth out­look for the full year.

Tea­neck, New Jersey­based Cog­nizant, which has most of its 217,000 em­ploy­ees in In­dia, said rev­enue in the quar­ter ended 30 June rose 22.6% from a year ear­lier and 6% from the pre­ced­ing quar­ter to $3.09 bil­lion, ex­ceed­ing its forecast of 3.4% sequential growth. Cog­nizant re­ported 6.2% sequential growth in rev­enue dur­ing the Jan­uaryMarch pe­riod.

The com­pany raised its rev­enue forecast for the sec­ond time in the year. It now ex­pects 2015 rev­enue to grow 20.1% to $12.33 bil­lion, com­pared with its ear­lier forecast of $12.24 bil­lion. Its per­for­mance, which was lifted largely on ac­count of higher spend­ing by clients in the healthcare busi­ness in North Amer­ica, was in line with an­a­lysts' ex­pec­ta­tions. An­a­lysts polled by Bloomberg ex­pected Cog­nizant to re­port rev­enue of $3.03 bil­lion dur­ing the three months ended 30 June.

Net in­come rose to $420.1 mil­lion in the quar­ter ended 30 June from $371.9 mil­lion in the year-ago pe­riod. "Our sec­ond quar­ter sequential rev­enue in­crease in dol­lar terms was the strong­est in our history," chief ex­ec­u­tive of­fi­cer Fran­cisco D'Souza said in a state­ment. "These re­sults val­i­date that our busi­ness strat­egy and our in­vest­ments po­si­tion us well to cap­ture the emerg­ing op­por­tu­ni­ties as clients look to trans­form into dig­i­tal busi­nesses. We in­creas- in­gly work with our clients to help them re-imag­ine their busi­nesses and build new ca­pa­bil­i­ties to suc­ceed in the dig­i­tal era."

At the core of Cog­nizant's strong per­for­mance, was 7.7% growth in the fi­nan­cial ser­vices space, driven largely by higher tech­nol­ogy spend­ing by large com­mer­cial banks. Clients in the fi­nan­cial ser­vices space ac­count for a lit­tle over 40% of Cog­nizant's rev­enue. The US, the ge­og­ra­phy which ac­counts for 78.6% of Cog­nizant's rev­enue, grew 5.8% while Europe, ex­clud­ing the UK, and which brings in about 6.6% of to­tal rev­enues, grew 7.3%.

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