Cognizant revenue rises 6% to $5.41 billion in March quarter

Bengaluru: Cognizant has posted a 6 per cent increase in its first quarter revenue (it follows the January-December calendar year) revenue to $5.41 billion and its net income for the March quarter stood at $662 million. The company had posted $663 million income in the year-ago period. Its operating margin stood at 15.6 per cent, down 110 basis points y-o-y.

For the second quarter, the company expects its revenue to be $5.45 to $5.52 billion, growth of 3.8 per cent to 5.3 per cent, or 3.2 per cent to 4.7 per cent in constant currency. For full year 2026, it expects revenue to be $22.11 to $22.64 billion, growth of 4.8 per cent to 7.3 per cent, or 4.0 per cent to 6.5 per cent in constant currency.

The company expects its full-year 2026 Adjusted Operating Margin to be about 16.0 per cent to 16.2 per cent, or 20 to 40 basis points of expansion.

During the company’s post-earnings conference, the company highlighted the challenging macro environment.

CFO Jatin Dalal said this year is more uncertain than last year, both from macro, geopolitical and specific industry sort of undercurrents. “In the first quarter, we achieved strong bookings growth of 21 per cent, expanded our adjusted operating margin year-over-year and drove double-digit adjusted EPS growth that outpaced revenue," he added.

On a trailing-twelve-month basis, bookings increased 11 per cent y-o-y at $29.6 billion, which represented a book-to-bill of about 1.4x. Bookings in the first quarter increased 21 per cent y-o-y. First quarter bookings included seven large deals, which are deals with total contract value of $100 million or greater, of which one was a mega deal, which is a deal with total contract value of $500 million or greater, the company said.

"In a complex macroeconomic environment, we delivered first quarter revenue growth in the upper half of our guidance range, with sustained bookings momentum and Financial Services again leading performance. We signed seven large deals in the quarter and delivered over 70 per cent large deal total contract value growth year-over-year," said Ravi Kumar S, Chief Executive Officer.

"We believe our AI builder strategy, deep industry expertise and scaled partnership ecosystem uniquely position us to bridge the 'AI Velocity Gap' by helping clients convert their significant AI investments into tangible business outcomes,” he added.

Cognizant also announced that it will acquire Astreya, a platform-led, global AI-first IT managed services and solutions provider headquartered in San Jose, California. The deal is valued at about $600 million.