Cognizant announces third quarter 2015 results
Third quarter revenue up 3.3% sequentially and 23.5% year-over-year
Raises full year revenue and EPS guidance
November 4, 2015 - Cognizant Technology Solutions Corporation (NASDAQ: CTSH) today announced its third quarter 2015 financial results.
Highlights Third Quarter 2015
- Third quarter revenue of $3.19 billion was up 23.5% from the year-ago period and up 3.3% sequentially.
- GAAP diluted EPS was $0.65, up from $0.58 in the year-ago period.
- Non-GAAP diluted EPS was $0.76, up from $0.66 in the year-ago period.
Revenue for the third quarter of 2015 rose to $3.19 billion, up 23.5% from $2.58 billion in the third quarter of 2014. GAAP net income was $397.2 million, or $0.65 per diluted share, compared to $355.6 million, or $0.58 per diluted share, in the third quarter of 2014. Non-GAAP diluted earnings per share was $0.76 compared to $0.66 in the third quarter of 2014. GAAP operating margin for the quarter was 17.0%. Non-GAAP operating margin was 19.4%, within the Company¹s target range of 19-20%. Reconciliations of non-GAAP financial measures to GAAP operating results and diluted EPS are included at the end of this release.
³We experienced another quarter of strong performance, building on our solid momentum in the first half of the year with continued broad-based demand across key industries and geographies we serve,² said Francisco D¹Souza, Chief Executive Officer of Cognizant. ³As clients worldwide shift spending toward investments that drive innovation and growth in the digital era, our portfolio of services is well positioned to meet their needs and capture a disproportionate share of the market.²
³Our third quarter results, and increased guidance for the full year, clearly demonstrate that clients are turning to Cognizant to help them transition into digital enterprises while optimizing their traditional investments in technology and business processes,² said Gordon Coburn, President. ³Large scale business transformations require a partner that brings a consultative approach to client engagement -- combining deep domain knowledge, understanding of clients¹ legacy systems, expertise in digital design and technologies, and ability to scale at an enterprise level. These are areas where we have invested significantly and have critical competitive differentiation to meet the changing demands of clients in a new digital world.²
2015 Outlook Fourth Quarter and Full Year
The Company is providing the following guidance:
- Fourth quarter 2015 revenue expected to be at least $3.23 billion.
- Fourth quarter 2015 non-GAAP diluted EPS expected to be at least $0.77.
- Fiscal 2015 revenue expected to be at least $12.41 billion, up at least 21% compared to 2014.
- Fiscal 2015 non-GAAP diluted EPS expected to be at least $3.03.
³Our balance sheet remains very healthy.Cognizant recorded another quarter of strong cash generation, resulting in an increase of almost $500 million in cash and short term investments,² said Karen McLoughlin, Chief Financial Officer. ³Additionally, during the quarter, we repaid the $100 million balance of our revolving credit facility and repurchased over $156 million of shares under our existing stock repurchase program. Year-to-date, we have repurchased 5.3 million shares for $334 million, reflecting the confidence in our business, commitment to drive shareholder value and ability to generate strong cash flows.²
Conference Call
Cognizant will host a conference call on November 4, 2015 at 8:00 a.m. (Eastern) to discuss the Company¹s third quarter 2015 results. To listen to the conference call, please dial (877) 810-9510 (domestic) and (201) 493-6778
(international) and provide conference passcode: Cognizant Call.
The conference call will also be webcast via the Cognizant website at
http://investors.cognizant.com/. Please access the website at least 15 minutes prior to the call to register and download/install any necessary audio software.
A replay of the conference call will be available by dialing (877) 660-6853 (domestic) or (201) 612-7415 (international) and entering 13621265 from two hours after the end of the call until 11:59 p.m. (Eastern) on Wednesday, November 18, 2015. The replay will also be available at Cognizant¹s website
http://investors.cognizant.com/ for 60 days following the call.
BERICHT VOOR DE REDACTIE
Over Cognizant
Cognizant (NASDAQ: CTSH) is een vooraanstaande dienstverlener in informatietechnologie, consultancy en business process outsourcing-services. Cognizant werkt in nauw partnerschap met ¹s werelds grootste organisaties om hun concurrentiepositie te versterken. Het hoofdkantoor is gevestigd in Teaneck, New Jersey (Verenigde Staten). Cognizant combineert een passie voor klanttevredenheid, technologische innovatie en diepgaande industrie- en bedrijfsproceskennis met een wereldwijd samenwerkend personeelsbestand. Cognizant heeft wereldwijd meer dan 100 ontwikkel- en delivery-centers en ongeveer 219.300 werknemers (per 30 september, 2015). Cognizant heeft een NASDAQ-100 en S&P 500-notering en is verder genoteerd in de Forbes Global 2000 en Fortune 500. De organisatie behoort hiermee tot de best presterende en snelstgroeiende bedrijven in de wereld. Bezoek onze website
www.cognizant.com of volg ons via Twitter:
@Cognizant.
Forward-Looking Statements
This press release includes statements which may constitute forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995,including, but not limited to, our expectations regarding opportunities in the marketplace and our anticipated financial performance, the accuracy of which are necessarily subject to risks, uncertainties, and assumptions as to future events that may not prove to be accurate. Factors that could cause actual results to differ materially from those expressed or implied include general economic conditions and the factors discussed in our most recent Annual Report on Form 10-K and other filings with the Securities and Exchange Commission. Cognizant undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise, except as may be required under applicable securities law.
About Non-GAAP Financial Measures
To supplement our financial results presented in accordance with GAAP, this press release includes the following measures defined by the Securities and Exchange Commission as non-GAAP financial measures: non-GAAP operating margin and non-GAAP diluted earnings per share (³non-GAAP diluted EPS²). These non-GAAP measures are not based on any comprehensive set of accounting rules or principles and should not be considered a substitute for, or superior to, financial measures calculated in accordance with GAAP, and may be different from non-GAAP measures used by other companies. In addition, these non-GAAP measures should be read in conjunction with our financial statements prepared in accordance with GAAP. The reconciliations of Cognizant¹s GAAP financial measures to the corresponding non-GAAP measures should be carefully evaluated.With respect to our expectations in the ³2015 Outlook - Fourth Quarter and Full Year² section above, reconciliation of non-GAAP diluted EPS guidance to GAAP diluted EPS guidance cannot be provided without unreasonable efforts on a forward-looking basis due to the high variability and low visibility with respect to net non-operating foreign currency exchange gains or losses which are excluded from the non-GAAP diluted EPS.
We seek to manage the company to a targeted operating margin, excluding stock-based compensation costs and acquisition-related charges, of 19% to 20% of revenues. Acquisition-related charges include, when applicable, amortization of purchased intangible assets included in the depreciation and amortization expense line on our condensed consolidated statements of operations, external deal costs, acquisition-related retention bonuses, integration costs, changes in the fair value of contingent consideration liabilities, charges for impairment of acquired intangible assets and other acquisition-related costs. In addition to excluding stock-based compensation costs and acquisition-related charges, our non-GAAP diluted EPS also exclude net non-operating foreign currency exchange gains or losses, inclusive of gains and losses on related foreign exchange forward contracts not designated as hedging instruments for accounting purposes. Management believes providing investors with an operating view consistent with how it manages the company provides enhanced transparency into the operating results of the company. For our internal management reporting and budgeting purposes, we use non-GAAP financial measures for financial and operational decision making, to evaluate period-to-period comparisons and for making comparisons of our operating results to those of our competitors. Therefore, it is our belief that the use of non-GAAP financial measures provides a meaningful supplemental measure for investors to evaluate our financial performance. Accordingly, we believe that the presentation of non-GAAP operating margin and non-GAAP diluted EPS, when read in conjunction with our reported GAAP results, can provide useful supplemental information to our management and investors regarding financial and business trends relating to our financial condition and results of operations.
A limitation of using non-GAAP measures versus financial measures calculated in accordance with GAAP is that non-GAAP measures do not reflect all of the amounts associated with our operating results as determined in accordance with GAAP and exclude costs that are recurring, namely stock-based compensation, acquisition-related charges, including amortization of purchased intangibles, and net non-operating foreign currency exchange gains or losses. In addition, other companies may calculate non-GAAP financial measures differently than us, thereby limiting the usefulness of these non-GAAP financial measures as a comparative tool. We compensate for these limitations by providing specific information regarding the GAAP amounts excluded from non-GAAP operating margin and non-GAAP diluted EPS to allow investors to evaluate such non-GAAP financial measures.
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