Synopsis : Cognizant reported a strong Q1 performance for CY2025 with net income rising 21.4% to $663 million. The IT major maintained its full-year revenue guidance, banking on AI transformation and BFSI recovery.
Cognizant Q1 Net Income Jumps 21.4%; AI-Led Growth Keeps Revenue Guidance Intact
Global IT services provider Cognizant kicked off calendar year 2025 with a robust performance, posting a 21.4% year-on-year surge in net income to $663 million for the January–March quarter. Revenue rose 8.2% in constant currency to $5.1 billion, aligned with company forecasts.
CEO Ravi Kumar S. attributed the solid start to strong operational execution, growth across all verticals, and momentum from recent acquisitions like Belcan, which contributed 400 basis points to the topline growth.
Despite a 7% dip in total contract value (TCV) compared to the previous year, the 12-month trailing TCV stood at $26.7 billion, indicating sustained client confidence.
Segment-wise, the health sciences vertical led the way with 11.4% growth, followed by products and resources at 13.6%, and financial services at 6.5%, driven largely by increased discretionary spending and AI-led digital transformation across client industries.
Geographically, the US market grew by 9.7%, followed by 7.1% in the rest of the world and 3% in Europe, showing broad-based traction.
CFO Jatin Dalal highlighted an EPS growth of 10%, exceeding revenue gains due to improved margins and cost discipline. He added that $1.7 billion will be returned to shareholders in 2025 through dividends and buybacks, while the company maintains capital for strategic growth.
Looking ahead, Cognizant expects Q2 revenue growth of 5–6.5% in constant currency. It also plans to hire 20,000 freshers in 2025, although headcount saw a slight decline of 500 in Q1, totaling 336,300 employees.
Despite broader global economic uncertainty and tariff concerns, the company reported no major project ramp-downs or client pullbacks, reinforcing confidence in its diversified strategy.
Disclaimer : This article is for informational purposes only and does not constitute financial or investment advice. Readers are advised to consult with certified professionals before making any investment decisions.
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