Cognizant Profit Up 22%, 2024 Revenue Guidance Narrowed

Cognizant's net profit rose 22% year-on-year to $566 million in the second quarter of 2024, while revenue guidance for the year has been narrowed.

On a sequential basis, the profit rose 3.6%. Revenue from operations came in at $4.9 billion, a sequential increase of 1.9%, and a 0.7% decline annually in reported terms.

The Nasdaq-listed IT services company has narrowed the revenue guidance to -0.5% to 1% for 2024 from a decline of 2% to growth of 2% earlier in constant-currency terms. Guidance for the third quarter is flat at 1.5% in CC terms.

For the second quarter, operating margin expanded to 14.6% from 11.8% in the year-ago period, and adjusted operating margin of 15.2%, which expanded 100 basis points. Cognizant follows calendar year.

"Progress against our strategic priorities is opening new opportunities with clients and allowing us to operate with greater agility," Chief Executive Officer Ravi Kumar S said. "We believe our performance this quarter and the improved organic growth outlook for the full year demonstrate how our execution against these priorities is beginning to translate to our results and support long-term shareholder value."

Bookings in the second quarter increased 5% YoY. On a trailing 12-month basis, bookings declined 1% YoY to $26.2 billion, which represented a book-to-bill of approximately 1.4 times.

Voluntary attrition on a trailing 12-month basis was 13.6% as compared to 19.9% for the quarter ended June 2023. The total headcount at the end of the second quarter was 3.36 lakh, a decline of 8,100 sequentially and 9,300 annually.