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The company’s second-quarter 2023 revenues are expected to be between $4.83 billion and $4.88 billion, indicating a decline of 1% to flat on a constant-currency (cc) basis from the year-ago quarter’s reported figure.
The Zacks Consensus Estimate for revenues is pegged at $4.81 billion, suggesting a decline of 1.87% from the year-ago quarter’s reported number.
The consensus mark for second-quarter earnings has remained unchanged at 97 cents per share in the past 30 days, suggesting a year-over-year decline of 14.91%.
Cognizant Technology Solutions Corporation Price and EPS Surprise
Cognizant beat the Zacks Consensus Estimate for earnings in two of the trailing four quarters and meeting in the remaining two, the average surprise being 2.58%.
Let’s see how things have shaped up for the upcoming announcement.
Factors to Note
Cognizant’s second-quarter 2023 performance is likely to have benefited from significant growth in its digital business operations. This reflects on momentum in AI, health sciences, automation, IoT, quantum computing and as-a-service solutions.
The company has been benefiting from solid partnerships as companies worldwide are accelerating digital transformation. During the to-be-reported quarter, it partnered with companies like Orkla and ServiceNow to optimize operations across sectors, bolster AI-driven automation and expedite innovation.
The high demand across its Healthcare segment has been noteworthy. Partnerships with Accuray and Microsoft are expected to have expanded its footprint in the healthcare market. Our model estimate for second-quarter 2023 Healthcare revenues is pegged at $1.41 billion, indicating a 0.3% year-over-year growth.
Cognizant banks on a long-standing client relationship, robust product pipeline and a global delivery network. In the second quarter, it initiated the NextGen program to simplify the operating model, optimize corporate functions and realign the workforce. These factors are likely to have driven its second-quarter top line.
A declining attrition rate on a sequential basis is expected to have contributed to Cognizant’s performance. Our model estimate for second-quarter 2023 attrition rate is pegged at 22.2% compared with 23% in the previous quarter and 31% in the year-ago quarter.
However, challenging macroeconomic conditions, raging inflation and stiff competition are expected to have hurt top-line growth.
Softer discretionary spending and decision delays by existing and potential clients are expected to have hurt Financial Services and Communications, Media & Technology (CMT) solutions. Our model estimate for second-quarter 2023 Financial Services and CMT revenues is pegged at $1.48 billion and $797 million, indicating a 4.1% and 2.4% year-over-year decline, respectively.
What Our Model Says
Per the Zacks model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here.
Cognizant currently has an Earnings ESP of 0.00% and a Zacks Rank #4 (Sell). You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Stocks to Consider
Here are some companies worth considering, as our model shows that these have the right combination of elements to beat on earnings in their upcoming releases:
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Cognizant (CTSH) to Report Q2 Earnings: What's in Store?
Cognizant Technology Solutions (CTSH - Free Report) will report second-quarter 2023 results on Aug 2.
The company’s second-quarter 2023 revenues are expected to be between $4.83 billion and $4.88 billion, indicating a decline of 1% to flat on a constant-currency (cc) basis from the year-ago quarter’s reported figure.
The Zacks Consensus Estimate for revenues is pegged at $4.81 billion, suggesting a decline of 1.87% from the year-ago quarter’s reported number.
The consensus mark for second-quarter earnings has remained unchanged at 97 cents per share in the past 30 days, suggesting a year-over-year decline of 14.91%.
Cognizant Technology Solutions Corporation Price and EPS Surprise
Cognizant Technology Solutions Corporation price-eps-surprise | Cognizant Technology Solutions Corporation Quote
Cognizant beat the Zacks Consensus Estimate for earnings in two of the trailing four quarters and meeting in the remaining two, the average surprise being 2.58%.
Let’s see how things have shaped up for the upcoming announcement.
Factors to Note
Cognizant’s second-quarter 2023 performance is likely to have benefited from significant growth in its digital business operations. This reflects on momentum in AI, health sciences, automation, IoT, quantum computing and as-a-service solutions.
The company has been benefiting from solid partnerships as companies worldwide are accelerating digital transformation. During the to-be-reported quarter, it partnered with companies like Orkla and ServiceNow to optimize operations across sectors, bolster AI-driven automation and expedite innovation.
The high demand across its Healthcare segment has been noteworthy. Partnerships with Accuray and Microsoft are expected to have expanded its footprint in the healthcare market. Our model estimate for second-quarter 2023 Healthcare revenues is pegged at $1.41 billion, indicating a 0.3% year-over-year growth.
Cognizant banks on a long-standing client relationship, robust product pipeline and a global delivery network. In the second quarter, it initiated the NextGen program to simplify the operating model, optimize corporate functions and realign the workforce. These factors are likely to have driven its second-quarter top line.
A declining attrition rate on a sequential basis is expected to have contributed to Cognizant’s performance. Our model estimate for second-quarter 2023 attrition rate is pegged at 22.2% compared with 23% in the previous quarter and 31% in the year-ago quarter.
However, challenging macroeconomic conditions, raging inflation and stiff competition are expected to have hurt top-line growth.
Softer discretionary spending and decision delays by existing and potential clients are expected to have hurt Financial Services and Communications, Media & Technology (CMT) solutions. Our model estimate for second-quarter 2023 Financial Services and CMT revenues is pegged at $1.48 billion and $797 million, indicating a 4.1% and 2.4% year-over-year decline, respectively.
What Our Model Says
Per the Zacks model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here.
Cognizant currently has an Earnings ESP of 0.00% and a Zacks Rank #4 (Sell). You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Stocks to Consider
Here are some companies worth considering, as our model shows that these have the right combination of elements to beat on earnings in their upcoming releases:
Perion Network (PERI - Free Report) has an Earnings ESP of +5.14% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
PERI’s shares have gained 39.4% year-to-date. Perion Network is set to report its second-quarter 2023 results on Aug 2.
Fair Isaac (FICO - Free Report) has an Earnings ESP of +3.12% and a Zacks Rank of 3 at present.
Fair Isaac’s shares have returned 37.9% year to date. FICO is set to report its third-quarter fiscal 2023 results on Aug 2.
Etsy (ETSY - Free Report) has an Earnings ESP of +2.82% and a Zacks Rank #3.
Etsy’s shares have declined 16.8% year to date. ETSY is set to report second-quarter 2023 results on Aug 2.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calender.