Cognizant cuts 2022 revenue guidance | The Financial Express

Cognizant cuts 2022 revenue guidance

It has also lowered its full-year adjusted diluted earnings per share (EPS) guidance to be in the range of $4.43-4.46 from $4.51-4.57 in the previous quarter.

Cognizant cuts 2022 revenue guidance
Bookings in the quarter declined 2% year-on-year and represented an in-period book-to-bill of approximately 1.0x.

Nasdaq-listed Cognizant Technology Solutions has lowered its full-year 2022 revenue growth guidance to 7% in constant currency to about $19.3 billion, reflecting currency headwinds and an uncertain macroeconomic environment. It had forecast a full-year revenue growth of 8.5-9.5% during the June quarter.

It has also lowered its full-year adjusted diluted earnings per share (EPS) guidance to be in the range of $4.43-4.46 from $4.51-4.57 in the previous quarter.

The Teaneck, New Jersey-based firm reported a 15.6% rise in net profit to $629 million for the September quarter from $544 million a year ago, on the back of a 5.6% rise in revenue in constant currency from the year-ago period to $4.9 billion. The company follows the calendar year.

“Revenue and bookings were below our expectations as company-specific fulfilment challenges were compounded by the impact of an uncertain macroeconomic backdrop,” chief executive officer Brian Humphries said. “We are confident the steps we are taking will return the company to accelerated growth over the medium to long term.”

Bookings in the quarter declined 2% year-on-year and represented an in-period book-to-bill of approximately 1.0x. This resulted in trailing 12-month bookings of $23.1 billion, which represented a book-to-bill of approximately 1.2x.

The company’s digital revenue grew 7% annually and contributed 51% to the total revenues for the September quarter as digital bookings continued to grow. It continues to focus on its priority areas of digital engineering, artificial intelligence (AI) and analytics, cloud, and internet of things (IoT).

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Revenue from financial services grew 1.6% in constant currency, driven by digital services among public sector clients in the UK and insurance clients. Growth was offset by a 180-basis-point negative impact related to the previously disclosed sale of the Samlink subsidiary, completed on February 1.

Health sciences revenue grew 5.5% in constant currency, driven by digital services among pharmaceutical and healthcare payer clients. Products and resources revenue grew 8.2% in constant currency, driven by digital services among logistics, automotive, consumer goods, and travel and hospitality clients.

Communications, media and technology revenue grew 10.4% in constant currency, driven by strength among digital native companies.

The voluntary annualised attrition rate reduced to 29% in the September quarter from 31% in the preceding three months. The total headcount stood at 349,400 employees as of September 30.

IT stocks on Thursday were among the top drags on the Indian markets, which ended flat even as global stocks sank after the US Fed rate hike. The Nifty IT index closed 1.18% down. On the Sensex, Tech Mahindra, Infosys, Wipro and TCS also among the laggards.

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First published on: 04-11-2022 at 06:00 IST