BENGALURU: US-based Cognizant Technology Solutions continued its strong run and for the third consecutive quarter raised its full-year revenue guidance to 21%, after posting quarterly numbers that came in ahead of market expectations, driven mainly by robust spending from top healthcare customers such as Merck.
Cognizant raised its annual revenue guidance of 20.1% to 21%, after yet another strong performance from North America — the company’s largest geography in terms of revenues . For the October-December quarter, Cognizant forecast sequential revenue growth of 1.3% to $3.23 billion.
For the July-September quarter, Cognizant posted a net profit of $397.2 million, compared to $355.6 million a year ago — full-year revenue is now expected to touch $12.4 billion. Revenue jumped 23.5% to $3.19 billion.
“We experienced another quarter of strong performance, building on our solid momentum in the first half of the year with continued broad-based demand across key industries and geographies we serve,” said Francisco D’Souza, Chief Executive Officer of Cognizant. “As clients worldwide shift spending toward investments that drive innovation and growth in the digital era, our portfolio of services is well positioned to meet their needs and capture a disproportionate share of the market.”
Revenue from North America grew 26.7% to $2.51 billion, while European sales climbed 8% to $509 million.
The upbeat numbers from Cognizant comes at a time when global technology spending is in the doldrums. According to technology researcher Gartner, worldwide IT spending is expected to drop by as much as 5.5% in 2015.
The strong numbers from Cognizant will soothe investors who have raised questions about future demand from traditional IT services at a time when technology and business models are undergoing a paradigm shift at the very core.
Over the past 5 years, Cognizant along with larger Indian rival TCS has set the benchmark for the sector, grabbing market share away from former bellwether firms Infosys and Wipro, who during the same period faced a decline in their fortunes that eventually prompted massive organizational overhauls at both Bangalore-based firms.
Over the past 3-4 quarters, Cognizant has even outpaced growth rates at TCS, which during the same period has posted numbers that fell short of its own sky-high high standards and expectations of investors.
