Cognizant Q2 revenue meets on financial services growth

Overview

• U.S. AI and tech services firm's Q2 revenue grew 4.5%, meeting analyst expectations

• Adjusted EPS for Q2 slightly missed analyst consensus

• Company repurchased $1.1 bln in shares and completed Astreya acquisition in Q2

Outlook

• Cognizant expects Q3 revenue of $5.60-$5.68 bln, growth of 3.4%-4.9%

• Company sees 2026 revenue at $22.04-$22.35 bln, growth of 4.4%-5.9%

• Cognizant raises 2026 adj EPS guidance to $5.70-$5.82, growth of 8%-10%

Result Drivers

• FINANCIAL SERVICES GROWTH - Double-digit year-over-year revenue growth in Financial Services segment supported overall results, per CEO Ravi Kumar S

• AI-LED CLIENT DEMAND - Company cited demand for AI transformation and data modernization as key drivers, supported by investments in workforce reskilling and platform partnerships

• DISCIPLINED EXECUTION - Management attributed margin expansion and steady growth to operational rigor and resilience in a complex environment, per CFO Jatin Dalal

Company press release: ID:nPn9Njq6La

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 14 "strong buy" or "buy", 17 "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the it services consulting peer group is "buy"

• Wall Street's median 12-month price target for Cognizant Technology Solutions Corp is $63.00, about 25.2% above its July 28 closing price of $50.31

• The stock recently traded at 8 times the next 12-month earnings vs. a P/E of 11 three months ago

Reuters Recommended Reads

• July 28 - Exlservice Q2 revenue beats estimates

• July 29 - Sopra Steria raises growth target on strong European AI, cybersecurity demand

• July 27 - Kforce Q2 revenue slightly beats estimates as Flex sales grow

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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)