Cognizant Sees 21.4% Increase in Q1 Profits, Confirms Full-Year Revenue Outlook

Cognizant, the massive IT services company has confirmed its full-year revenue growth guidance of 3.5 to 6 percent in constant currency, supported by improved discretionary spending in the banking, financial services, and insurance sectors.

The company reported, in the first quarter of calendar year 2025, a net income of $663 million, which marks a 21.4 percent increase from $546 million at the same time last year. Their revenue increased by 8.2 percent over the year and continued to reach $5.1 billion, bringing it into line with company forecasts. The growth was notably strengthened by the acquisition of Belcan, which contributed about 400 basis points to the topline.

CEO of Cognizant, Ravi Kumar S. stated that Cognizant’s differentiated AI and platform offerings are enabling clients to manage short-term challenges while advancing long-term transformation initiatives. It reflects the disciplined execution of their long-term strategy; he also added the rising importance of productivity, cost efficiency, and resilience.

While the total contract value for the quarter declined 7 percent year-on-year, the trailing 12-month TCV remains solid at $26.7 billion.

Cognizant’s largest sector increased 11.4 percent over the year, financial services rose 6.5 percent and the remaining products and resources were up 13.6 percent. 

The Chief Financial Officer, Jatin Dalal, said that their first-quarter performance reflects strong operational care in a period of elevated uncertainty. They have delivered revenue above the high end of their guidance and expanded adjusted operating margin by 40 basis points per year. 

He also mentioned that Cognizant expects to return around $1.7 billion to shareholders through buybacks and dividends in 2025. The company plans to hire 20,000 freshmen in 2025, but the total headcount declined by 500 in Q1.