Cognizant Technology Solutions on Wednesday reported a 2.2 per cent sequential rise in revenues for the three months to December. The New Jersey-based outsourcer reported revenues of $2,355 million in its fiscal fourth quarter.
Cognizant's growth in the December quarter was lower than its Indian rivals such as Tata Consultancy services and HCL Technologies. TCS, India's biggest outsourcer, reported a 3 per cent rise in US dollar sales during the December quarter, which is considered to be a weak period for companies because of furloughs and holidays in key markets such as the US and Europe.
Profits (GAAP) stood at $324.3 million, up 16.3 per cent from the year-ago quarter, the company said in a statement. Non-GAAP operating margin was 20.7 per cent, higher than the company's targeted 19-20 per cent range, Cognizant said.
Shares in the company, however, fell over 4 per cent ahead of markets opening on the back of slower-than-expected sales outlook for the current year.
Cognizant, which puts out an annual sales outlook, said it expects revenues of at least $10.3 billion in 2014, indicating a 16.5 per cent year-on-year growth. That would be sharply lower than its 2013 growth rate of 20.4 per cent.
Cognizant's outlook is likely to weigh on Indian outsourcers, which have gained sharply over the last few months on hopes of a rebound in demand especially in the US. The US and Europe account for over 75 per cent revenues of companies such as Infosys.
Cognizant added a net of 5,000 employees during the quarter, taking its year-end headcount to approximately 1.71 lakh.
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