Cognizant Technology Solutions reported yet another solid performance in the September quarter, beating its competitors in both revenue growth and profitability growth. Debashis Chatterjee, President, Technology Solutions, Cognizant, told BusinessLine that it was a ‘solid quarter and saw good demand across the business,” and on various metrics. Excerpts from the interview:

You beat your Indian competitors in both revenue and profitability growth. What were the key drivers?

We had another solid quarter and saw good demand across the business, with particular strength in Consulting and Technology services as clients continue to focus on implementing digital technologies to drive business transformation. During the quarter, Consulting and Technology services increased 4.6 per cent sequentially and 34.2 per cent year over year and Outsourcing services was up 1.5 per cent sequentially and 11.1 per cent from the year ago quarter.

Any major trend witnessed in the quarter?

We saw a continuation of the trend we have seen in recent quarters whereby clients are shifting spend from legacy application maintenance towards project-based work, including digital and other transformational programmes. For the quarter, Consulting and Technology Services represented 58 per cent of revenue and Outsourcing Services 42 per cent of revenue.

Which were the major sectors that contributed to the growth?

Banking and financial services segment grew 2.7 per cent sequentially and 18.6 per cent year-over-year, driven primarily by strength in banking. Growth continues to be broad based across our banking clients, who remain focused on cost optimisation, vendor consolidation, regulatory compliance and cyber security.

The healthcare segment, which consists of payer, provider, pharmaceutical, biotech, and medical device clients, grew 4.7 per cent sequentially, and, including the impact of TriZetto, grew 43.3 per cent year-over-year. As the healthcare industry shifts from fee-for-service to value-based care models, healthcare organisations are looking for new ways to deliver consumer-centric care while simultaneously looking for ways to drive operational efficiency.

Our retail and manufacturing segment was up 4.8 per cent sequentially and 13.7 per cent year-over-year. Clients are focused on modernising their technology environment, particularly around supply chains and omni-channel commerce solutions. On the manufacturing side, in particular, we are seeing strong demand around product transformation.

How about the geographical spread in revenue generation?

North America grew 3.6 per cent sequentially and 26.7 per cent year-over-year. Europe was up 1.4 per cent sequentially and 7.8 per cent from last year, after a 10.4 per cent negative currency impact. We saw continued strong traction in the Rest of the World, which was up 5.3 per cent sequentially and 31 per cent year-over-year. Growth was driven primarily by strength in key markets in Asia, such as Singapore and Australia.

The results press release said that that clients are turning to Cognizant to help them transition into digital enterprises while optimising their traditional investments in technology and business processes. Could you explain?

Our clients recognise that becoming a digital enterprise is now a necessity, a matter of survival, as businesses, products, people and devices become more connected. Therefore, they are looking for innovative ways to combine their traditional business models and product sets with new and continuously evolving digital technologies.

This is leading to a significant change in the way IT and operations budgets are allocated.

Clients are recalibrating their spending, moving dollars from ‘keep-the-lights-on’ maintenance and operations projects to new digital initiatives that create competitive advantage by enabling new levels of business performance.

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