 "Leaner workforce cuts costs for Cognizant, powers quarterly beat")
(Reuters) - Cognizant Technology Solutions Corp beat Wall Street estimates for quarterly profit and revenue on Wednesday, as the information technology company brought down costs by trimming its workforce.
Shares of the company were up 2%, after gaining nearly 5% so far this year.
The company also said Vice Chairman Francisco D’Souza, who co-founded Cognizant and served as the chief executive officer from 2007 to 2019, would step down from the role.
Cognizant warned of job cuts in October to invest in growth areas such as cloud and internet of things and cushion the impact from a decline in spending by its financial customers, which the company expected to continue through the second half of 2019.
In a cloud push, it recently acquired Code Zero Consulting and French operations of EI-Technologies.
Chief Financial Officer Karen McLoughlin said in the earnings call the company expects restructuring charges at the end of 2020 to be at the low end of the $150 million to $200 million range it proposed in October.
Revenue rose 4% to $4.28 billion in the fourth quarter from a year ago, above analysts’ average estimate of $4.23 billion, according to IBES data from Refinitiv.
Impact Shorts
More ShortsRevenue from the financial services segment rose 1.5% and that from healthcare services rose 1.8% in constant currency. The two segments contribute to more than half of the company’s total revenue.
Cognizant said it expected current-quarter revenue to be in the range of 2.8% to 3.8% in constant currency, while analysts on average were expecting a growth of 3.4%.
The company forecast full-year revenue growth in the range of $17.11 billion to $17.45 billion, slightly above analysts’ estimates of $17.27 billion.
Net income fell 39% to $395 million in the fourth quarter.
Excluding items, the company earned $1.07 per share, above estimates of $1.04 per share.
(Reporting by Amal S in Bengaluru; Editing by Shinjini Ganguli)
This story has not been edited by Firstpost staff and is generated by auto-feed.
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