Cognizant maintains lead over Wipro in revenue and outlook

Cognizant Technology Solutions has again maintained a lead over Wipro in both revenues and outlook.

The Nasdaq-listed company reported a 31.6 per cent growth in revenue to $1.6 billion during the quarter ended September 30, compared to $1.2 billion in the third quarter of 2010.

Wipro’s revenue from information technology services business in the same quarter was $1.47 billion (sequential increase of 4.6 per cent and a year-on-year increase of 15.7 per cent), lower than Cognizant's revenue for the period.

The company's fourth quarter revenue is anticipated to be at least $1.66 billion, a 3.7 per cent sequential rise. For the entire year, the revenue is expected to be $6.11 billion, up 33 per cent over that in 2010.

Wipro's official expectation for the quarter ending December 31 for its IT services business is expected to be in the range of $1.5-1.53 billion, sequential growth of two to four per cent.

“Cognizant has delivered another strong quarter of industry-leading revenue growth, with non-GAAP operating margins within our target range. Growth during the quarter was again broadbased across our portfolio of industries, services and geographies,” said Francisco D’Souza, president and CEO.

Quarterly earnings per share on a GAAP basis was $0.73, compared to $0.66 in the year-ago quarter.

Cognizant reported a 9.2 per cent growth in net profit during the third quarter at $227.1 million, compared to $203.6 million a year ago.

During the quarter, the company added around 12,000 people, which included around 4,000 employees from the CoreLogic India acquisition.

Gordon Coburn, chief financial and operating officer, said the company spent $163 million to repurchase shares during the quarter, reflecting confidence in the ability to generate strong cash flows.