Cognizant Q4: Revenue up 14.2% on-year

IT services bellwether Cognizant has reported a 14.2 per cent year-on-year growth in its revenue in Q4 2021. Cognizant reported revenue of $4.8 billion in Q4 and a full-year revenue of $18.5 billion. The IT bellwether reported a 20 per cent on-year and a 19 per cent quarter-on-quarter rise in digital revenue, which represents 45 per cent of total revenue.   Full year operating cash flow of $2.5 billion and free cash flow of $2.2 billion was reported in Q4 On February 2, the company declared a quarterly cash dividend of $0.27 per share, which will be payable on March 1. Q4 2021 bookings saw a 22 per cent y-o-y spurt, resulting in full-year bookings worth $23.1 billion in 2021 and representing a book-to-bill of 1.2x.   “During 2021, we continued to invest in our people and strategic initiatives while navigating the heightened cost pressures driven by the labor supply-demand imbalance. With $2.7 billion of cash and short-term investments and free cash flow in excess of 100 percent of net income, we are well-positioned to execute our balanced capital allocation framework, including the third consecutive annual increase of the dividend we announced today,” said Cognizant CFO Jan Siegmund in the company’s Q4 earnings call.   Key sectors that contributed to Cognizant’s revenue spurt in Q4 were financial services, healthcare, products and resources and communications, media and technology. Financial services sector reported a y-o-y growth of 18.5 per cent in revenue on the back of banking and insurance growth.   The products and resources saw a growth of 17.7 per cent y-o-y due to strong demand reported from manufacturing, logistics, energy and utility clients and sustained demand through 2021 across retail, consumer goods, travel and hospitality following the COVID-19 impact in 2020.   Communications, media and technology revenue grew 12.6 per cent y-o-y on the back of completed acquisitions and strong demand from technology clients. The company announced acquisitions of cloud company Linium, data and analytics company Servian, Internet of Things (IoT) companies TQS Integration and ESG Mobility and digital engineering companies Hunter and Devbridge.   The company’s revenue from healthcare grew 7.9 per cent year-on-year led by life sciences. The revenue spurt was driven by increased demand for digital services and the company’s integrated software solutions for healthcare clients.   Meanwhile, the company has projected likely revenue of $4.8 billion-$4.84 billion in the first quarter of 2022 and full year revenue of $20 billion-$20.5 billion for 2022. Cognizant CEO Brian Humphries said during the earnings call, “I’m proud of Cognizant’s broad-based progress over the past year. We successfully executed our strategy by meaningfully enhancing our digital portfolio, strengthening our international presence, and helping our clients be successful. We enter 2022 with momentum and confidence that our talented employees position us to capture the substantial market opportunity.”   The IT services behemoth currently has 330,600 employees in all. Cognizant’s workforce saw a quarter-on-quarter rise by 12,200 employees and a year-on-year spurt by 41,100 employees. The company reported voluntary annualised attrition at 31 per cent and voluntary trailing 12-month attrition at 28 per cent.   Also read: Cognizant Q3 revenue jumps 11% to $4.7 bn on demand boost

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