Goutam Das
shook up the Indian IT industry's pecking order on Monday, displacing Infosys for the first time in terms of
quarterly revenues. The new No. 2 of the industry reported revenues of $1.79 billion in the June quarter. In comparison, Infosys generated a top line of $1.75 billion.
Analysts estimate that Cognizant will maintain its lead over Infosys even in the September quarter. While Cognizant has guided for revenues of at least $1.87 billion during the quarter, Infosys is expected to clock $1.81 billion. In a departure from tradition, Infosys has recently done away with quarterly guidance citing market volatility.
Cognizant's results yet again confirm the
sharp divide amongst Indian IT's top tier firms. While
TCS and Cognizant have emerged clear winners even in a difficult economic environment, Infosys and Wipro have proved laggards. As mentioned in an earlier
BT story, market watchers have often questioned Infosys' high-margin business model that hardly resonates in the current environment. In the June quarter, the firm wrote off $15 million due to a transformational project cancellation in Europe. Voices skeptical of
Infosys's strategy are likely to become even louder post Cognizant's sparkling results.
Cognizant's full year growth guidance of "at least 20 per cent" for 2012 is far ahead of Nasscom's 11to 14 per cent growth projection and is four times that of Infosys. For the year ending March 2013, Infosys expects to grow just about five per cent.
While the Infosys management cited the discouraging environment and used one-liners such as " We are running a marathon and not a sprint" during its press meet post the June quarter results, Cognizant's appeared more confident.
President Gordon Coburn said in a statement, "Cognizant once again delivered industry leading growth despite a challenging macro-economic environment. This market downturn, as with those before, is serving as a catalyst for clients to embrace a broader range of our services."
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