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Cognizant Q3 net dips 3.6% to $477 mn, revises revenue outlook

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Press Trust of India New Delhi
US-based IT major Cognizant Tuesday said its net profit dipped 3.6 per cent to USD 477 million in the September quarter on account of higher foreign exchange losses and revised its FY2018 revenue growth outlook to up to 8.9 per cent.
The company, which had registered a net profit of USD 495 million in July-September 2017, attributed the decline in net income to "higher net non-operating foreign exchange losses in 2018 driven by the depreciation of the Indian rupee versus the prior year period".
Cognizant's revenues during the September 2018 rose 8.3 per cent to USD 4.08 billion, meeting its guidance range of USD 4.06-4.10 billion for the period. In the September 2017 quarter, its revenue was USD 3.77 billion.
However, the company revised its FY2018 revenue forecast and said the topline is expected to be in the range of USD 16.09 billion to USD 16.13 billion -- translating into a growth of 8.6-8.9 per cent over the previous year. In August, the company had said it expects its revenues for 2018 to be in the range of USD 16.05-16.30 billion - which would have translated into a growth of 8.3-10 per cent.
For the fourth quarter, Cognizant now expects its topline to be in the range of USD 4.09-4.13 billion.
The company, which follows January-December as fiscal, has a majority of its workforce in India.
"Cognizant delivered strong third-quarter results in three of our four business segments. We made continued progress in our shift to digital by building new capabilities and helping our clients excel with digital services and solutions," Cognizant CEO and Vice Chairman of the Board Francisco D'Souza said.
He added that the company's performance this year demonstrates its "ability to both invest for growth and achieve our financial targets".
"We've accelerated Cognizant's pivot to digital while driving revenue growth, margin improvement and capital returns. And therefore we expect our forward momentum to continue to deliver strong results," he said.
During the September quarter, the company added 5,300 employees (net) taking its total headcount to 2,74,200.
"We delivered solid performance in the third quarter as we continued to focus on sustainable revenue growth while increasing margins...The strength of our balance sheet allows the company to maintain financial flexibility while driving a substantial return of capital to shareholders," Cognizant CFO Karen McLoughlin said.

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First Published: Oct 30 2018 | 8:50 PM IST

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