Friday, May 6, 2016

Cognizant Technology Earnings

Today Cognizant Technology(CTSH) reported Q1 EPS of $0.80(Non-GAAP), and $0.72(GAAP) on revenues up 10% to $3.20 billion.  The company lowered it's Q2 guidance to $0.80-0.82/share, but they kept their full year guidance(Non-GAAP) the same at $3.32-$3.44.  Additionally the company lowered it's revenue outlook at the top end by $200 million so expect between $13.65 - $14.0 billion for the year. The shares initially fell to $56 but have rallied back up to $59+. Here is what CEO Francisco D'Souza had to say.

"Overall, our first quarter results were in line with our expectations and guidance. Client demand for our digital expertise, services and technologies remains strong," said Francisco D'Souza, Chief Executive Officer. "We continue to see positive returns from our extensive strategic investment in disruptive technologies, new digital business models and best-in-class delivery capabilities. We believe our strong fundamentals have positioned us well to be the transformation partner of choice for our clients."

"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," said Gordon Coburn, President. "As we move into the second quarter, we are quite pleased with our momentum with new and existing clients, which we expect to drive sequential revenue growth in the second quarter of $140 to $200 million. To support this expected growth, we significantly accelerated hiring during the first quarter and increased our global headcount by 11,300 employees."

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