Cognizant Technology Solutions Corporation (CTSH) has reported a 26.30 percent rise in profit for the quarter ended Mar. 31, 2017. The company has earned $557 million, or $0.92 a share in the quarter, compared with $441 million, or $0.72 a share for the same period last year. On an adjusted basis, earnings per share were at $0.84 for the quarter compared with $0.80 in the same period last year.
Revenue during the quarter grew 10.74 percent to $3,546 million from $3,202 million in the previous year period. Gross margin for the quarter contracted 207 basis points over the previous year period to 38.13 percent. Total expenses were 83.93 percent of quarterly revenues, up from 82.70 percent for the same period last year. That has resulted in a contraction of 123 basis points in operating margin to 16.07 percent.
Operating income for the quarter was $570 million, compared with $554 million in the previous year period.
However, the adjusted operating income for the quarter stood at $669 million compared to $637 million in the prior year period. At the same time, adjusted operating margin contracted 103 basis points in the quarter to 18.87 percent from 19.89 percent in the last year period.
"We delivered solid results in the first quarter and continued to build our digital solutions portfolio, expand our skills, and enhance our engagements with clients," said Francisco D’Souza, Chief Executive Officer. "We're making good progress in accelerating Cognizant's shift to digital services and solutions to create value for clients and shareholders, positioning us well to achieve both our revenue and margin targets for this year."
For fiscal year 2017, Cognizant Technology Solutions Corp projects revenue to be in the range of $14,560 million to $14,840 million. The company expects diluted earnings per share to be $3.64 on adjusted basis.
For the second-quarter, Cognizant Technology Solutions Corp projects revenue to be in the range of $3,630 million to $3,680 million. On an adjusted basis, the company expects diluted earnings per share to be $0.89.
Operating cash flow improves significantly
Cognizant Technology Solutions Corporation has generated cash of $277 million from operating activities during the quarter, up 284.72 percent or $205 million, when compared with the last year period.
Cash flow from investing activities was $91 million for the quarter as against cash outgo of $228 million in the last year period.
The company has spent $1,124 million cash to carry out financing activities during the quarter as against cash outgo of $471 million in the last year period.
Cash and cash equivalents stood at stood at $1,308 million as at Mar. 31, 2017.
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