InvestorQ : Why did Cognizant report such disappointing numbers and what does that mean for other Indian IT companies?
Sam Eswaran made post

Why did Cognizant report such disappointing numbers and what does that mean for other Indian IT companies?

Answer
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swati Bakhda answered.
3 months ago


While Cognizant is not listed in India, it is still a major IT player at par with the Big-4 in the industry. Cognizant reported 29% drop in Jun-20 quarter profits at $361 million and expects FY20 revenues of around 16.7 billion. Cognizant follows the calendar year cycle for financial accounting with annual year ending on December. It employs 2 lakh staff in India.

Revenue across business segments was negatively impacted for Cognizant by COVID-19 pandemic as well as the ransom-ware attack. In May and June, there was elevated demand in segments like cloud and enterprise application, IT modernisation and digital engineering. BFSI, which constitutes 35% of revenues, fell 5.2% driven by fall in banking and insurance.

There was weakness across global banking accounts and capital markets segments. However, healthcare, which accounts for 29% of revenues, grew 2% driven by increases from life sciences clients. Products & resources, accounting for 22% of revenues, fell by 6.5% and that was largely driven by retail, consumer goods, travel and hospitality clients.