Cognizant April-June profit up 13%; firm raises revenue outlook

Buoyed by strong growth in healthcare and financial services business, IT services firm Cognizant on Wednesday posted a 12.9 per cent jump in net profit for the June quarter and revised its forecast for revenues to grow "at least 20.1 per cent" in the ongoing fiscal. The US-based firm, which has <g data-gr-id="31">major</g> presence in India, has reported a net profit of $420.1 million in the second quarter of 2015 as against $371.9 million in the same period a year ago.

Revenues for the April-June 2015 quarter rose by 22.6 <g data-gr-id="21">per cent</g> to $3.09 billion as against $2.52 billion in the year-ago period, beating its own estimate of revenues to be "at least $3.01 billion". The revenue was up over 6 <g data-gr-id="22">per cent</g> from $2.91 in the January-March quarter. "Our second quarter sequential revenue increase in dollar terms was the strongest in our history. We're seeing robust demand for our services, a trend that has continued to accelerate from the first quarter," Cognizant CEO Francisco D'Souza said in a conference call. He added that there is robust underlying demand across the geographies and industries that it serves.

"Clients are recalibrating their spending, moving dollars from lights-on maintenance and operations projects to new digital initiatives. We are in a strong position to capture the enormous opportunities that are emerging from the transition to digital business," he said. Cognizant follows January-December as its fiscal year.

"Growth drivers <g data-gr-id="24">are wins</g> in digital, executing digital transformations and innovation-at-scale; driving new levels of operational efficiency for clients; and strategic investments paying off," Cognizant CFO Karen McLoughlin said.