Cognizant Q2: Revenue up 7% on-year to $4.9 bn; expects revenue growth of 7.3% for full year

Nasdaq-listed IT major, Cognizant, reported a revenue growth of 7 per cent year-on-year or 9.5 per cent growth in constant currency to $4.9 billion. It expected the third quarter revenue to witness a growth of 5-6 per cent to $4.98-5.03 billion. 

For the full year 2022, Cognizant expects revenue to increase 6.3-7.3 per cent or 8.5-9.5 per cent in constant currency to $19.7-19.9 billion. 

The company added that the operating margin of 15.5 per cent, which is an increase of 30 basis points year-on-year. 

The IT major said that it deployed over $1 billion on share purchases and dividends year-to-date. 

It added that it has an employee count of 3,41,00, and a voluntary annualised attrition of 31 per cent. It added over 900 employees on-quarter, and over 40,100 on-year. 

Brian Humphries, Chief Executive Officer said, "In a period of unprecedented labor market conditions characterised by elevated attrition and significant wage inflation, we focused on our client commitments and delivered balanced financial results in the second quarter. As we position the company for sustained success, we will continue to invest in our talented employees, our clients and our capabilities."

The company’s financial services segment grew 2.7 per cent on-year or 5.1 per cent in constant currency, driven by the growth in US regional banking clients, and solid performance within insurance. The sale of the Samlink subsidiary negatively impacted the segment revenue growth by 190 basis points, it added. 

The health sciences segment grew 6.3 per cent on-year or 7.6 per cent in constant currency. The growth in this segment was driven by digital services among pharmaceutical clients and sustained demand for integrated software solutions. 

The revenue for products and resources segment grew 8.1 per cent on-year or 11.6 per cent in constant currency, driven in part by strength among automotive, logistics, retail and consumer goods clients. 

The communications, media and technology segment revenue grew 16.1 per cent on-year, or 19.5 per cent in constant currency. 

The company said that its second quarter bookings declined 3 per cent on-year. 

Also read: Attrition-hit Cognizant adds 9,800 employees for Q1, CY22