Sales at Cognizant drops 2% in the December quarter to a 2-year low

CHENNAI/BENGALURU: As the IT industry continues to be plagued by weakness in demand, Cognizant Technology Solutions, a major provider of IT services, reported on Wednesday a 0.3% fall in constant currency revenue for the full year 2023, coming in at $19.4 billion.

Revenue for the December quarter was $4.8 billion, which represented a 2.4% decrease in constant currency terms from the same time last year. In the last eight quarters, this is the lowest quarterly revenue. Cognizant uses accounting based on the calendar year.
Comparing the revenue performance of the quarter, Infosys, TCS, and HCLTech performed better. Constant currency sales increase was recorded by TCS at 1.7%, Infosys at 1%, and HCLTech at more than 4%.
The largest verticals for Cognizant, financial services and healthcare, both saw revenue declines of 2.7% and 6.6% year over year. However, as the company’s cost-optimization initiative NextGen began to show benefits, quarterly net income grew to $558 million in the quarter ending December 2023 from $521 million in the same time last year. The firm anticipates further challenges since North American and European markets account for the majority of its sales.