Cognizant weathered economic turmoil in Europe well and generated solid second quarter results as the India outsourcing company projected revenue growth of at least 20 percent for the year.
The company reported second quarter earnings of $251.9 million, or 82 cents a share, on revenue of $1.79 billion, up 20.9 percent from a year ago. Non-GAAP earnings, which exclude option expenses, were 88 cents a share. Wall Street was looking for earnings of 80 cents a share on revenue of $1.79 billion.
As for the outlook, Cognizant projected third quarter earnings to be 86 cents a share on revenue of $1.87 billion. That projection was in line with estimates. For 2012, Cognizant projected earnings of $3.38 a share on revenue of at least $7.34 billion. Wall Street was looking for earnings of $3.37 a share on revenue of $7.34 billion for 2012.
In a statement, Francisco D'Souza, CEO of Cognizant, said the company saw demand for the company's "new stack of social, mobile, analytics, and cloud technologies." In addition, Cognizant execs said that it was gaining business in a market downturn.
For instance, Cognizant's sequential growth rates topped peers. Cognizant said second quarter sequential revenue growth was 4.9 percent. Infosys' sequential revenue fell 1.1 percent in its latest quarter and Wipro also took a hit, down 1.4 percent. Tata saw sequential revenue growth of 3 percent.
Analysts said that Cognizant's financial services revenue and healthcare, manufacturing and retail were solid. "Cognizant reiterated its full year 2012 guidance of more than 20 percent revenue growth, which we think will be a relief to some given mixed earnings reports from other Indian IT Services comps," said Jefferies analyst Jason Kupferberg in a research note.