Cognizant Third Quarter Net Income Declines 30 Per Cent to $348 Million
The American multinational product-led Digital Corporation ‘Cognizant’ that provides digital products on Thursday, has reported a 30 per cent year-on-year drop in its September third-quarter net profit to $348 million (around Rs.2,578.3 crore), while the revenue fell 0.1% to $4.2 billion.
The United-States Based Firm which posted a net profit of $497 million in the September 2019 quarter, said it expects its full-year 2020 revenue to be at the higher end of the previously guided range at approximately $16.7 Billion and a drop of 0.4 per cent in constant currency.
In a statement, Cognizant chief executive officer Brian Humphries said, “Against a challenging demand environment we continued to strengthen our portfolio executes our digital strategy and increases our competitiveness”. The statement extended by saying, Cognizant’s priority areas of digital engineering, artificial intelligence (AI) and analytics, internet of things (IoT) and cloud are more relevant than ever to clients and we aim to lead in the third quarter of digital, which will require continued investments in M&A , offer management talent and branding.
Cognizant Technology Solutions Corporation’s digital business grew 13 per cent year-on-year and provided 42 per cent to total revenue for the third quarter (Q3) as digital bookings continued to grow. However, since the starting of the third quarter, IT major has returned over $800 million of capital to shareholders through share repurchases and dividends.
Besides, the revenue from financial services (34.6% of revenue) dropped 1.5 per cent year-on-year, driven by declines in both insurance and banking while Healthcare (29 per cent of revenue) grew 4.8 % year-on-year, driven by life sciences. Also, the revenue from products and resources decreased 4 per cent y-o-y led by retail, consumer goods, travel, and hospitality clients that were adversely affected by the coronavirus (covid-19) pandemic.
Moreover, excluding the coronavirus epidemic impact, the communication, media, and technology grew by approximately 9 % in constant currency terms.