Cognizant profit rises 23%; forecasts Q2 revenue at $2.5 bn
New Delhi: IT services major Cognizant Wednesday posted a 22.8 percent jump in net profit to USD 348.9 million in the January-March quarter, driven by strong momentum in the European region and broad-based growth across businesses.
The New Jersey-headquartered firm had registered a profit of USD 284.2 million in the first quarter of 2013. Revenue in the first quarter of 2014 climbed 19.9 percent to USD 2.42 billion, Cognizant said in a statement.
"Our broad set of capabilities and our compelling value proposition enable Cognizant to help clients simultaneously run better and run different, by not only driving efficiency in their operations, but also helping them to re-imagine and re-design their business models," Cognizant Chief Executive Officer Francisco D'Souza said.
The company expects revenue to increase to between USD 2.5 billion and USD 2.53 billion in the second quarter, compared with USD 2.16 billion a year earlier. For 2014, revenue is forecast to be at least USD 10.3 billion, up 16.5 percent from 2013.
"We remain confident in the overall demand environment and in our ability to deliver our previously stated revenue guidance of at least USD 10.3 billion for 2014," Cognizant President Gordon Coburn said.
As the impact of digital technologies increasingly becomes a CEO-level agenda item, Cognizant is well-positioned to capitalise on this trend, he added.
Business in the UK region, which accounted for 11.5 percent of the quarter's revenue, grew 28.2 percent year-on-year to more than USD 1 billion.
Overall, the European region's business grew 35 percent y-o-y, accounting for 19.4 percent of the quarter's revenue.
The North American market grew 16.1 percent (75.8 percent of revenue), while the rest of the world saw revenue rising 28.4 percent.
Cognizant added about 7,200 people (net), taking its global head count to about 178,600 employees as of March 31.
"Our continued focus on operational excellence and our strong ramp-up in hiring during the quarter positions us to effectively service the healthy demand environment that we anticipate this year," Cognizant Chief Financial Officer Karen McLoughlin said.
Financial services saw a 19.7 percent growth from a year ago, while manufacturing, retail & logistics and healthcare grew over 20 percent.