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After the top-four Indian IT companies (TCS, Infosys, Wipro, HCL Technologies) posted strong September-quarter results, US-headquartered software-services firm Cognizant on Tuesday carried that cheery earnings momentum several notches ahead by recording a 6.4% sequential jump in quarterly profit, backed by buoyancy in outsourcing services and discretionary spend.
Seeing an increased demand for its services, the Nasdaq-listed IT company revised upward its full-year revenue outlook for the second time this year to 20.3% from its earlier projection of 19%.
For the July-September stretch, Cognizant, which has most of its employees based in India, recorded a sequential dollar revenue growth of 6.7%, ahead of Tata Consultancy Services (TCS), India’s largest IT-services exporter, which posted a revenue growth of 5.4%. Bangalore-headquartered Infosys Ltd had a sequential growth of 3.8% during the same period followed by HCL Technologies at 3.5% and Wipro recording a growth of 2.7%.
During the quarter, Cognizant’s revenue stood at $2.31 billion from $1.89 billion, up 21.9% a year ago, while TCS recorded a revenue of $3.33 billion in the quarter ending September. Over the last one year Cognizant was the only non-Indian software-services firm that was busy disrupting the
Indian IT pecking order. It first outperformed Wipro and then last year, it edged past Infosys in the quarterly revenue growth rate. During the March quarter, Cognizant even moved ahead of TCS in sequential dollar revenue growth.
For the quarter, the New Jersey-based IT firm recorded a net income of $319.6 million against $276.9 million, in the corresponding period last year, recording a year-on-year growth of 15.4%. “We delivered yet another quarter of industry-leading growth that was broad-based across our portfolio of industries, services and geographies,” said Cognizant CEO Francisco D’Souza.
In comparison, the TCS profit figure was more than double that of Cognizant’s at $748 million during the September quarter. India’s second-largest IT company Infosys had delivered a net profit of $383 million during the same period.
However, Cognizant’s revenue from the North American region surpassed TCS’ by a narrow margin of $8 million during the quarter on strong discretionary spend. The New-Jersey headquartered company registered a revenue of $1.783 billion from North America recording a sequential growth of 6.3% while for TCS it was $1.775 billion, growing at 3.7%.
North America is one of the largest markets for the Indian IT-BPO industry accounting for over 60%