First time in 14 yrs, Cognizant posts slowest quarter due to volatile markets, slow spending

For the first time in 14 years, US-based Cognizant Technology Solutions could not beat Infosys and posted its slowest quarterly revenue growth.

Cognizant also cut the upper end of their full-year revenue guidance and forecasted revenues in the range of $13.65 billion to $14 billion.

For the March quarter, Cognizant registered a net profit of $441.2 million, compared to $382.9 million in the year-ago period.

For the June quarter, the company forecast revenues in the range of $3.34 billion to $3.40 billion.

New Jersey-based Cognizant Teaneck said that it was hurt by slow spending from top healthcare customers.

"As anticipated, during the first quarter we saw softness in our healthcare segment due to M&A activity, as well as softness in our banking segment due to financial market volatility," said Gordon Coburn, president at Cognizant, adding, “As we move into the second quarter, we are quite pleased with our momentum with new and existing clients, which we expect to drive sequential revenue growth in the second quarter of $140 to $200 million.”

Meanwhile, Cognizant also failed to trump Infosys in growth rates for the first time since 2002-03, indicating that under Vishal Sikka, Infosys is on track.