Cognizant Technology Solutions Corporation (NASDAQ:CTSH), a leading provider of information technology, consulting, and business process services, today announced its third quarter 2016 financial results.
Highlights-Third Quarter 2016
| • | Third quarter revenue of $3.45 billion was up 8.4% from the year-ago period and up 2.5% sequentially. |
| • | GAAP diluted EPS was $0.73 vs. $0.65 in the year-ago period. |
| • | Non-GAAP diluted EPS1 was $0.86 vs. $0.76 in the year-ago period. |
| • | Net headcount addition for the quarter was approximately 11,500. |
Revenue for the third quarter of 2016 was $3.45 billion, up 8.4% from $3.19 billion in the third quarter of 2015. GAAP net income was $444.4 million, or $0.73 per diluted share, compared to $397.2 million, or $0.65 per diluted share, in the third quarter of 2015. Non-GAAP diluted EPS1 was $0.86 compared to $0.76 in the third quarter of 2015. GAAP operating margin for the quarter was 16.9%. Non-GAAP operating margin1 for the quarter was 19.3%, within the Company’s target range of 19-20%.
“We see ongoing client demand for our services across industries and geographies,” said Francisco D’Souza, Chief Executive Officer. “As the physical and digital worlds converge, we have made it easier for clients to work with us by aligning our organizational structure and capabilities around the broader focus of assisting clients drive digital transformations. Our new President, Raj Mehta, who has been a key member of our senior leadership team for two decades, and the broader team of executives are leading our strategic initiatives. They have a proven track record of innovation, execution and an unwavering focus on client service and satisfaction.”
2016 Outlook-Fourth Quarter and Full Year
The Company is providing the following guidance:
| ▪ | Fourth quarter 2016 revenue expected to be in the range of $3.45 billion to $3.51 billion. |
| ▪ | Fourth quarter 2016 non-GAAP diluted EPS expected to be in the range of $0.85 to $0.88. |
| ▪ | Fiscal 2016 revenue expected to be in the range of $13.47 billion to $13.53 billion. |
| ▪ | Fiscal 2016 non-GAAP diluted EPS2 is expected to be in the range of $3.38 to $3.41. |
“Third quarter revenue was within, and non-GAAP EPS was slightly above, our guided range, indicating that we continue to execute well on our stated strategy,” said Karen McLoughlin, Chief Financial Officer. “Our solid performance was also reflected in another strong quarter of cash flow generation as cash and investments, net of debt increased by $390 million.”
Conference Call
Cognizant will host a conference call on November 7, 2016 at 8:00 a.m. (Eastern) to discuss the Company’s third quarter 2016 results. To listen to the conference call, please dial (877) 810-9510 (domestic) and (201) 493-6778 (international) and provide conference passcode: Cognizant Call.
The conference call will also be webcast via the Cognizant website at http://investors.cognizant.com/. Please access the website at least 15 minutes prior to the call to register and download/install any necessary audio software.
A replay of the conference call will be available by dialing (877) 660-6853 (domestic) or (201) 612-7415 (international) and entering 13648517 from two hours after the end of the call until 11:59 p.m. (Eastern) on Monday, November 21, 2016. The replay will also be available at Cognizant’s website http://investors.cognizant.com/ for 60 days following the call.
About Cognizant
Cognizant (NASDAQ:CTSH) is a leading provider of information technology, consulting, and business process services, dedicated to helping the world’s leading companies build stronger businesses. Headquartered in Teaneck, New Jersey (U.S.), Cognizant combines a passion for client satisfaction, technology innovation, deep industry and business process expertise, and a global, collaborative workforce that embodies the future of work. With over 100 development and delivery centers worldwide and approximately 255,800 employees as of September 30, 2016, Cognizant is a member of the NASDAQ-100, the S&P 500, the Forbes Global 2000, and the Fortune 500 and is ranked among the top performing and fastest growing companies in the world. Visit us online at www.cognizant.com or follow us on Twitter: Cognizant.