Cognizant Technology Solutions Prepares to Unveil Q3 2024 Results
Cognizant Technology Solutions CTSH is set to announce its third-quarter 2024 results on October 30th.
The Zacks Consensus Estimate for earnings stands at $1.15 per share, remaining stable over the last 30 days. This figure reflects a slight decrease of 0.86% compared to the same quarter last year.
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Cognizant anticipates third-quarter 2024 revenues between $4.89 billion and $4.96 billion. This ranges from a decline of 0.2% to an increase of 1.3%, with a modest rise of 1.5% when adjusted for constant currency. Additionally, acquisitions are expected to contribute 70 basis points in this quarter.
Revenue Expectations and Historical Performance
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The Zacks Consensus Estimate predicts third-quarter revenues of $5 billion, representing a year-over-year increase of 2.17%. In recent quarters, Cognizant has consistently exceeded the Zacks Consensus Estimate, averaging a surprise of 6.56% across the last four quarters.
What’s Influencing Cognizant’s Performance?
Cognizant’s performance in the third quarter is likely to have benefited from a growing client base and a strong pipeline filled with promising new opportunities. In the second quarter of 2024, the company secured five agreements each valued at over $100 million, showcasing robust demand for larger deals. This traction should positively impact the upcoming report.
A well-developed network of partners, including Gentherm (THRM), Microsoft (MSFT), and CNO Financial Group (CNO), is also expected to drive growth this quarter. Cognizant’s collaboration with Gentherm aims to improve agility and scalability in product development through advanced technologies like cloud and virtualization.
Moreover, an expanded partnership with Microsoft seeks to utilize generative AI to spark innovation in various industries, enhancing enterprise operations and employee experiences.
Additionally, Cognizant’s ongoing work with CNO Financial aims to enhance technology services for middle-income Americans by optimizing cloud and digital technologies.
Investments in generative AI, especially in partnership with Microsoft and NVIDIA, are anticipated to enhance Cognizant’s service offerings and foster future growth. The company’s NextGen initiative should also aid in improving operational efficiency.
Nevertheless, challenges remain, particularly in the Financial Services segment and adverse foreign exchange rates, both of which may adversely affect spending trends and overall revenue growth in the upcoming quarter.
Cognizant currently holds a Zacks Rank of #3 (Hold). You can view today’s complete list of Zacks #1 Rank (Strong Buy) stocks here.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
