Cognizant's Q1 bookings drop 7 pc despite revenue growth

New Delhi, May 1 (IANS) Global Information Technology (IT) major Cognizant has reported 7 per cent year-on-year (YoY) decline in bookings in the first quarter of calendar year (Q1 CY25).

However, trailing 12-month bookings rose 3 per cent YoY to $26.7 billion, boosted by four large deals, each worth over $100 million.

The company posted a revenue of $5.1 billion for the first quarter of 2025, showing a 7.5 per cent increase compared to the same period last year (Q1 CY24).

“Our portfolio strength and industry expertise are positioning us well amid global uncertainty,” said CEO Ravi Kumar S, adding that the company’s AI-led solutions are helping businesses cut costs and boost productivity.

In constant currency terms, revenue grew 8.2 per cent. The company’s (generally accepted accounting principles) GAAP operating margin rose to 16.7 per cent, an increase of 210 basis points YoY.

However, this included a one-time gain of $62 million from the sale of an office complex in India. On an adjusted basis, the operating margin stood at 15.5 per cent, which is 40 basis points higher than Q1 of 2024.

GAAP, refers to a set of accounting rules and standards followed in the US to ensure consistency and transparency in financial reporting.

Cognizant’s GAAP earnings per share (EPS) came in at $1.34, a 22 per cent jump from the year-ago quarter. Adjusted EPS stood at $1.23, reflecting a 10 per cent growth.

The company attributed this performance to disciplined execution, strong operational rigour, and strategic investments made over the past few years.

CFO Jatin Dalal added that despite external challenges, Cognizant delivered revenue above expectations and improved margins.

“The company plans to return $1.7 billion to shareholders in 2025 through buybacks and dividends,” Dalal mentioned.

As of March 31, Cognizant had a headcount of 336,300 employees. The firm also plans to hire 20,000 freshers this year as it builds capabilities for managed services and AI-driven software development.

Meanwhile, Cognizant finds itself in a legal crossfire with Indian IT heavyweight Infosys. The legal battle between the two escalated last month, with Infosys filing fresh charges in a US district court in Dallas, Texas.

Infosys accused Cognizant of abusing its monopoly power in the healthcare software sector via its TriZetto platform to stifle competition.

Cognizant has responded by asking the court to dismiss Infosys’ antitrust counterclaims, arguing that the Indian company has failed to provide substantive evidence to support its allegations of monopolistic practices.

--IANS

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