Cognizant Technology Solutions reported a 20 per cent drop in net profit to $316 million in the fourth quarter ended December 31, 2020, as against $395 million in the corresponding quarter last year. Revenue declined by 2 per cent to $4.18 billion ($4.28 billion). Full-year net profit declined by 24 per cent to $1.39 billion ($1.84 billion) on a flat revenue of $16.65 billion ($16.78 billion).
The quarterly and full-year revenue included the impact of the anticipated exit from a customer engagement and the exit from certain content services, the company said in a press release.
Cognizant to buy Magenic Technologies
Cognizant made an offer in the fourth quarter to settle and exit a large customer engagement in the financial services segment in Continental Europe. The offer includes, among other terms, a proposed one-time payment and forgiveness of certain receivables. As a result of this offer, in the fourth quarter of 2020, it recorded a reduction of revenue of $107 million and additional expenses of $33 million, primarily related to the impairment of long-lived assets, the release said.
Cognizant emerges as the new CEO factory
Brian Humphries, CEO, Cognizant, in the release said, “Having strengthened our portfolio, and anticipating the exit of a large financial services engagement, we enter 2021 reinvigorated by our growing commercial momentum, investments in our future, and our vision to become the pre-eminent technology services partner to clients globally.”
The IT major announced that first quarter revenue is expected to be $4.34-$4.38 billion, or growth of 2.8-3.8 per cent. Full-year 2021 revenue is expected to be $17.6-$18.1 billion, or growth of 5.5-8.5 per cent.
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.