One of the leading IT services provider Cognizant Technology Solutions reported its slowest quarterly revenue growth in 14 years. Cognizant clients in the financial and healthcare services held back on spending. Shares of the Cognizant forecast second quarter earnings below estimates, and fell about 1% in pre-market trading.
On Friday president Gordon Coburn said “As anticipated, during the first quarter we saw softness in our healthcare segment due to M&A activity, as well as softness in our banking segment due to financial market volatility.”
Indian rivals like Cognizant, Infosys Ltd and Tata Consultancy Services Ltd, are getting the largest chunk of its revenue from financial services clients. As company stated that it is expecting second quarter revenue between $3.34 billion-$3.40 billion and adjusted earnings between $0.80 billion-$0.82 billion. Analysts on an average had expected a profit of 84 cents per share and revenue of $3.41 billion. In the first quarter ended March 31, the company’s net income rose to $441.2 million, or 72 cents per share from $382.9 million or 62 % per share, a year earlier. Revenue from healthcare services rose 4% while revenue from its financial services sector 10.7%. The company’s revenue also rose 10 per cent to $3.20 billion, helped by higher demand for its digital services. Analysts on an average had expected a quarterly profit of 79% per share and revenue of $3.23 billion.
