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NEW YORK - On Wednesday, Cognizant Technology Solutions (NASDAQ:CTSH) reported third-quarter earnings that exceeded analyst expectations, with the IT services provider posting strong revenue growth and raising its full-year guidance.
The company’s shares rose 0.49% in pre-market trading following the announcement.
The company reported adjusted earnings per share of $1.39 for the third quarter, surpassing the analyst estimate of $1.30. Revenue came in at $5.42 billion, beating the consensus estimate of $5.32 billion and representing a 7.4% increase YoY, or 6.5% in constant currency.
"Our third quarter performance demonstrates the continued momentum in our business transformation efforts," said Ravi Kumar S, CEO of Cognizant. "The strong bookings and revenue growth across most segments reflect our clients’ confidence in our ability to deliver value in an evolving technology landscape."
Cognizant’s Products & Resources segment led growth with a 12.6% YoY increase, while Health Sciences and Financial Services grew 5.9% and 6.2% respectively. The recently completed Belcan acquisition contributed approximately 250 basis points to the company’s overall year-over-year growth.
Operating cash flow surged to $1.23 billion in the third quarter, compared to $847 million in the same period last year. Adjusted operating margin improved to 16.0% from 15.3% in the year-ago quarter.
Looking ahead, Cognizant raised its full-year 2025 outlook, now expecting revenue between $21.05 billion and $21.10 billion, up from the previous consensus of $20.95 billion. The company also increased its adjusted EPS guidance to $5.22-$5.26, above the analyst consensus of $5.17.
For the fourth quarter, Cognizant forecasts revenue of $5.27-$5.33 billion, in line with analyst expectations of $5.28 billion.
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