- Revenue of $4.8 billion declined
0.3% year-over-year, or grew 1.5% in constant
currency1
- Record trailing 12-month bookings of $25.6 billion; Q1 bookings growth of 28%
year-over-year
- Operating cash flow of $729
million and free cash flow[1] of $631
million
- Expect to return $1.4 billion to
shareholders through share repurchases and dividends in 2023
- 2023 revenue growth guidance of (1.2%) to 0.8%, or (1.0%) to
1.0% in constant currency
TEANECK,
N.J., May 3, 2023 /PRNewswire/ -- Cognizant
(Nasdaq: CTSH), one of the world's leading professional services
companies, today announced its first quarter 2023 financial
results.
"Our accelerated bookings growth in the quarter, which included
several large deals and a healthy mix of new and expansion work,
reflects the strengths of our services, our brand, and the
longstanding relationships we have with our clients. I am also
encouraged by the continuing reduction in our voluntary attrition,"
said Ravi Kumar S, Chief Executive Officer. "Clients recognize how
deeply we understand their businesses and how well positioned we
are to create value for them at the intersection of technology and
industry use cases. Having spent more than three months assessing
the business, meeting with over a hundred clients and thousands of
employees, I firmly believe Cognizant has a strong foundation for
accelerating growth."
|
Q1
2023
|
|
Q1
2022
|
|
Revenue (in
billions)
|
$4.8
|
|
$4.8
|
|
Y/Y Growth
|
(0.3 %)
|
|
9.7 %
|
|
Y/Y Growth
CC1
|
1.5 %
|
|
10.9 %
|
|
GAAP Operating
Margin
|
14.6 %
|
|
15.0 %
|
|
GAAP Diluted
EPS
|
$1.14
|
|
$1.07
|
|
Adjusted Diluted
EPS1
|
$1.11
|
|
$1.08
|
|
"We were pleased to deliver first quarter revenue above the
high-end of our guidance range and strong free cash flow that
supports our capital allocation priorities," said Jan Siegmund, Chief Financial Officer. "In 2023,
we expect to return approximately $1.4
billion to shareholders through share repurchases and
dividends, including approximately $800
million of share repurchases. The NextGen program announced
today will help fund continued investments in our people, growth
opportunities and realignment of our real-estate to reflect our
hybrid work model."
Bookings
Bookings in the first quarter grew 28% year-over-year. On a
trailing-twelve-month basis, bookings grew 9% to $25.6 billion, which represented a
book-to-bill of approximately 1.3x.
Employee Metrics
Total headcount at the end of the first quarter was 351,500, a
decrease of 3,800 from Q4 2022 and an increase of 11,100 from Q1
2022. Voluntary attrition - Tech Services on a
trailing-twelve-month basis, declined to 23% from 26% in Q4 2022
and 30% in Q1 2022.
Return of Capital to Shareholders
The Company repurchased 3.2 million shares for $200 million during the first quarter under its
share repurchase program. As of March 31,
2023, there was $2.6 billion
remaining under the share repurchase authorization. In May 2023, the Company declared a quarterly cash
dividend of $0.29 per share, a 7%
increase year-over-year, for shareholders of record on May 19, 2023. This dividend will be payable on
May 30, 2023.
NextGen Program
In the second quarter of 2023, we initiated the NextGen program
aimed at simplifying our operating model, optimizing corporate
functions and consolidating and realigning office space to reflect
the post-pandemic hybrid work environment. Our drive for
simplification will include operating with fewer layers in an
effort to enhance agility and enable faster decision making. We
expect the savings generated by the program to help fund continued
investments in our people, revenue growth opportunities and the
modernization of our office space.
In connection with the NextGen program, we expect to record
costs of approximately $400 million
with approximately $350 million of
such costs anticipated in 2023 and approximately $50 million in 2024. This consists of
approximately $200 million of
employee severance and other costs primarily related to
non-billable and corporate personnel, which we expect to mostly
incur in 2023, and approximately $200
million of costs related to the consolidation of office
space, with approximately $150
million in 2023 and $50
million in 2024.
We do not expect the NextGen program to drive meaningful cost
savings until the second half of 2023 and the real estate actions
will not begin to generate savings until 2024. By 2025, we expect
to reduce our annual real estate costs by approximately
$100 million versus 2022. This
reduction in real estate costs is net of investments to expand our
real estate footprint in smaller cities, primarily in India, in support of our hybrid work
strategy.
We expect the personnel-related actions of this program to
impact approximately 3,500 employees, or approximately 1% of our
workforce.
Second Quarter and Full-Year 2023 Guidance
- Second quarter revenue is expected to be $4.83 - $4.88
billion, a decline of 0.6% to 1.6%, or a decline of 1.0% to
flat in constant currency.
- Full-year 2023 revenue is expected to be $19.2 - $19.6
billion, or a decline of 1.2% to growth of 0.8%, or a
decline of 1.0% to growth of 1.0% in constant currency.
- Full-year 2023 Adjusted Operating Margin2 is
expected to be in the range of 14.2% to 14.7%.
- Full-year 2023 Adjusted EPS2 is expected to be in
the range of $4.11 to $4.34
Select Client and Partnership Announcements
- Announced a new 5-year agreement to support and transform the
technology operations of global retailer, Nike. Building on
its 14-year collaboration, Cognizant will support Nike's customers,
partners and employees worldwide, delivering several key
capabilities, including new self-service capabilities, improved
service productivity and significant cost savings.
- Selected by Horizon Healthcare Services, New Jersey's oldest and largest health
insurer, to support its government healthcare programs. As part of
a 7-year renewal agreement, Cognizant will manage Horizon's claims
processing, encounters submissions to the state, provider
configuration, and enrollment services for its 1.2 million Medicaid
and Dual Eligible Special Needs Plan members.
- In partnership with Guidewire, successfully migrated
claims to the cloud for regional property & casualty insurer,
FCCI Insurance Group, maximizing efficiency and accelerating
growth.
- In partnership with Veeva, selected by Boehringer
Ingelheim, a leading research-driven biopharmaceutical company,
to unify their data in a connected technology ecosystem, helping to
advance the speed and quality of medicinal therapy
development.
- Expanded long-standing healthcare collaboration with
Microsoft to integrate Cognizant's TriZetto healthcare
products with Microsoft Cloud for Healthcare, giving healthcare
payers and providers easy access to cutting-edge technology
solutions, streamlining claims management, and improving
interoperability to optimize business operations.
- Selected by the UK Department for the Environment, Food and
Rural Affairs to support the delivery of business change.
- In partnership with Amazon Web Services, achieved Travel
and Hospitality Consulting Competency status. By leveraging AWS
technologies, Cognizant helped Australian airline, Jetstar,
provide personalization and travel recommendations for its
customers.
- Selected by Volkswagen Group Ireland, the multinational
automotive manufacturer headquartered in Germany, to transform VWG Ireland's digital
customer service landscape.
- Selected by DSB, Denmark's state railway operator, as the
provider of offshore IT consulting services to accelerate, to scale
and improve DSB's ability to deliver against its digital
strategy.
- Launched the Data Intelligence Toolkit as a pre-built solution
for Snowflakes's Telecom Data Cloud, designed to help
telecommunications service providers accelerate digital
transformation for the Telecom industry, enable superior customer
experiences, maximize operational efficiency and monetize new data
services.
Select Analyst Ratings and Company Recognition
- Named to the Fortune list of America's Most Innovative
Companies 2023
- Recognized by Forbes as one of America's Best Management
Consulting Firms in 2023
- Recognized as a Top Employer in Canada and Portugal by LinkedIn
- Named as a Top Employer in Europe by Top Employers Institute for the 9th
consecutive year
- Cognizant Consulting Named a Leader for Business Consulting
Services by ISG
- Recognized as a Market Leader in Automation Services by HFS
Research
- Recognized as a Leader by Everest Group in Capital Markets
Operations
- Recognized as a Leader by Everest Group of Healthcare
Cloud-Based Core Administration
- Recognized as a Leader by Everest Group for Marketing
Services
- Named by Everest Group as a Healthcare Revenue Cycle Management
Platform Leader
- Named a Leader in Application and Digital Services Insurance by
Everest Group
- Named a Leader in Advanced Analytics & Insights Services by
Everest Group
Conference Call
Cognizant will host a conference call
on May 3, 2023, at 5:00 p.m.
(Eastern) to discuss the Company's first quarter 2023 results. To
listen to the conference call, please dial (877) 810-9510
(domestic) or +1 (201) 493-6778 (international) and provide
the following conference passcode: "Cognizant Call."
The conference call will also be available live on the Investor
Relations section of the Cognizant website at
http://investors.cognizant.com. An earnings supplement will also be
available on the Cognizant website at the time of the conference
call.
For those who cannot access the live broadcast, a replay will be
available. To listen to the replay, please dial (877) 660-6853
(domestically) or +1 (201) 612-7415 (internationally) and enter
13736815 beginning two hours after the end of the call until
11:59 p.m. (Eastern) on Thursday, May 17, 2023. The replay will also be
available at Cognizant's website www.cognizant.com for 60 days
following the call.
About Cognizant
Cognizant (Nasdaq: CTSH) engineers
modern businesses. We help our clients modernize technology,
reimagine processes and transform experiences so they can stay
ahead in our fast-changing world. Together, we're improving
everyday life. See how at www.cognizant.com or @cognizant.
Forward-Looking Statements
This press release
includes statements that may constitute forward-looking statements
made pursuant to the safe harbor provisions of the Private
Securities Litigation Reform Act of 1995, the accuracy of which are
necessarily subject to risks, uncertainties and assumptions as to
future events that may not prove to be accurate. These statements
include, but are not limited to, express or implied forward-looking
statements relating to our strategy, competitive position and
opportunities in the marketplace, investment in and growth of our
business, the effectiveness of our recruiting and talent efforts
and related costs, labor market trends, the anticipated amount of
capital to be returned to shareholders and our anticipated
financial performance. These statements are neither promises nor
guarantees, but are subject to a variety of risks and
uncertainties, many of which are beyond our control, which could
cause actual results to differ materially from those contemplated
in these forward-looking statements. Existing and prospective
investors are cautioned not to place undue reliance on these
forward-looking statements, which speak only as of the date
hereof. Factors that could cause actual results to
differ materially from those expressed or implied include general
economic conditions, the competitive and rapidly changing nature of
the markets we compete in, the competitive marketplace for talent
and its impact on employee recruitment and retention, our ability
to successfully implement our NextGen program and the amount of
costs, timing of incurring costs and ultimate benefits of such
plans, legal, reputational and financial risks resulting from
cyberattacks, risks related to the invasion of Ukraine by Russia, changes in the regulatory environment,
including with respect to immigration and taxes, and the other
factors discussed in our most recent Annual Report on
Form 10-K and other filings with the Securities and Exchange
Commission. Cognizant undertakes no obligation to update or revise
any forward-looking statements, whether as a result of new
information, future events, or otherwise, except as may be required
under applicable securities law.
About Non-GAAP Financial Measures and Performance
Metrics
Non-GAAP Financial Measures
To supplement our financial results presented in accordance
with GAAP, this press release includes references to the following
measures defined by the Securities and Exchange Commission as
non-GAAP financial measures: Adjusted Operating Margin, Adjusted
Diluted EPS, free cash flow, net cash and constant currency revenue
growth. These non-GAAP financial measures are not based on any
comprehensive set of accounting rules or principles and should not
be considered a substitute for, or superior to, financial measures
calculated in accordance with GAAP, and may be different from
non-GAAP financial measures used by other companies. In addition,
these non-GAAP financial measures should be read in conjunction
with our financial statements prepared in accordance with GAAP. The
reconciliations of our non-GAAP financial measures to the
corresponding GAAP measures should be carefully evaluated.
Our non-GAAP financial measure Adjusted Operating Margin
excludes unusual items. Our non-GAAP financial measure Adjusted
Diluted EPS excludes unusual items and net non-operating foreign
currency exchange gains or losses and the tax impact of all the
applicable adjustments. The income tax impact of each item
excluded from Adjusted Diluted EPS is calculated by applying the
statutory rate and local tax regulations in the jurisdiction in
which the item was incurred. Free cash flow is defined as cash
flows from operating activities net of purchases of property and
equipment. Net cash is defined as cash and cash equivalents and
short-term investments less short-term and long-term debt. Constant
currency revenue growth is defined as revenues for a given period
restated at the comparative period's foreign currency exchange
rates measured against the comparative period's reported
revenues.
Management believes providing investors with an operating
view consistent with how we manage the Company provides enhanced
transparency into our operating results. For our internal
management reporting and budgeting purposes, we use various GAAP
and non-GAAP financial measures for financial and operational
decision-making, to evaluate period-to-period comparisons, to
determine portions of the compensation for our executive officers
and for making comparisons of our operating results to those of our
competitors. Accordingly, we believe that the presentation of our
non-GAAP measures, which exclude certain costs, when read in
conjunction with our reported GAAP results, can provide useful
supplemental information to our management and investors regarding
financial and business trends relating to our financial condition
and results of operations.
A limitation of using non-GAAP financial measures versus
financial measures calculated in accordance with GAAP is that
non-GAAP financial measures do not reflect all of the amounts
associated with our operating results as determined in accordance
with GAAP and may exclude costs that are recurring such as our net
non-operating foreign currency exchange gains or losses. In
addition, other companies may calculate non-GAAP financial measures
differently than us, thereby limiting the usefulness of these
non-GAAP financial measures as a comparative tool. We compensate
for these limitations by providing specific information regarding
the GAAP amounts excluded from our non-GAAP financial measures to
allow investors to evaluate such non-GAAP financial
measures.
Performance Metrics
Bookings are defined as total contract value (or TCV) of new
contracts, including new contract sales as well as renewals and
expansions of existing contracts. Bookings can vary significantly
quarter to quarter depending in part on the timing of the signing
of a small number of large contracts. Our book-to-bill ratio is
defined as bookings for the trailing twelve months divided by
revenue for the same period. Measuring bookings involves the use of
estimates and judgments and there are no independent standards or
requirements governing the calculation of bookings. The extent and
timing of conversion of bookings to revenues may be impacted by,
among other factors, the types of services and solutions sold,
contract duration, the pace of client spending, actual volumes of
services delivered as compared to the volumes anticipated at the
time of sale, and contract modifications, including terminations,
over the lifetime of a contract. The majority of our contracts are
terminable by the client on short notice often without penalty, and
some without notice. We do not update our bookings for subsequent
terminations, reductions or foreign currency exchange rate
fluctuations. Information regarding our bookings is not comparable
to, nor should it be substituted for, an analysis of our reported
revenues. However, management believes that it is a key indicator
of potential future revenues and provides a useful indicator of the
volume of our business over time.
In the first quarter of 2023, we introduced a new metric,
Voluntary Attrition – Tech Services, which includes voluntary
separations with the exception of employees in our Intuitive
Operations and Automation practice. This new metric replaces
our prior attrition disclosure of company-wide voluntary and
involuntary attrition.
Investor Relations
Contact:
|
|
|
|
Media
Contact:
|
Tyler Scott
|
|
|
|
Jeff
DeMarrais
|
VP, Investor
Relations
|
|
|
|
VP, Corporate
Communications
|
+1
551-220-8246
|
|
|
|
+1
475-223-2298
|
Tyler.Scott@cognizant.com
|
|
|
|
Jeff.DeMarrais@cognizant.com
|
- tables to follow -
COGNIZANT TECHNOLOGY
SOLUTIONS CORPORATION CONSOLIDATED STATEMENTS
OF OPERATIONS (Unaudited)
|
|
(in millions,
except per share data)
|
Three Months
Ended
March 31,
|
|
2023
|
|
2022
|
Revenues
|
$ 4,812
|
|
$ 4,826
|
Operating
expenses:
|
|
|
|
Cost of revenues
(exclusive of depreciation and amortization expense shown
separately below)
|
3,143
|
|
3,097
|
Selling, general and
administrative expenses
|
835
|
|
862
|
Depreciation and
amortization expense
|
132
|
|
143
|
Income from
operations
|
702
|
|
724
|
Other income (expense),
net:
|
|
|
|
Interest
income
|
30
|
|
6
|
Interest
expense
|
(9)
|
|
(2)
|
Foreign currency
exchange gains (losses), net
|
12
|
|
—
|
Other, net
|
3
|
|
1
|
Total other income
(expense), net
|
36
|
|
5
|
Income before provision
for income taxes
|
738
|
|
729
|
Provision for income
taxes
|
(158)
|
|
(170)
|
Income (loss) from
equity method investment
|
—
|
|
4
|
Net income
|
$
580
|
|
$
563
|
Basic earnings per
share
|
$ 1.14
|
|
$ 1.07
|
Diluted earnings per
share
|
$ 1.14
|
|
$ 1.07
|
Weighted average number
of common shares outstanding - Basic
|
509
|
|
524
|
Dilutive effect of
shares issuable under stock-based compensation plans
|
—
|
|
1
|
Weighted average number
of common shares outstanding - Diluted
|
509
|
|
525
|
COGNIZANT TECHNOLOGY
SOLUTIONS CORPORATION CONSOLIDATED STATEMENTS
OF FINANCIAL POSITION (Unaudited)
|
|
(in millions, except
par values)
|
March 31,
2023
|
|
December 31,
2022
|
Assets
|
|
|
|
Current
assets:
|
|
|
|
Cash and cash
equivalents
|
$
2,458
|
|
$
2,191
|
Short-term
investments
|
23
|
|
310
|
Trade accounts
receivable, net
|
3,718
|
|
3,796
|
Other current
assets
|
1,029
|
|
969
|
Total current
assets
|
7,228
|
|
7,266
|
Property and equipment,
net
|
1,102
|
|
1,101
|
Operating lease assets,
net
|
842
|
|
876
|
Goodwill
|
6,040
|
|
5,710
|
Intangible assets,
net
|
1,262
|
|
1,168
|
Deferred income tax
assets, net
|
666
|
|
642
|
Long-term
investments
|
424
|
|
427
|
Other noncurrent
assets
|
583
|
|
662
|
Total
assets
|
$
18,147
|
|
$
17,852
|
Liabilities and
Stockholders' Equity
|
|
|
|
Current
liabilities:
|
|
|
|
Accounts
payable
|
$
332
|
|
$
360
|
Deferred
revenue
|
469
|
|
398
|
Short-term
debt
|
16
|
|
8
|
Operating lease
liabilities
|
173
|
|
174
|
Accrued expenses and
other current liabilities
|
2,331
|
|
2,407
|
Total current
liabilities
|
3,321
|
|
3,347
|
Deferred revenue,
noncurrent
|
32
|
|
19
|
Operating lease
liabilities, noncurrent
|
688
|
|
714
|
Deferred income tax
liabilities, net
|
215
|
|
180
|
Long-term
debt
|
630
|
|
638
|
Long-term income taxes
payable
|
283
|
|
283
|
Other noncurrent
liabilities
|
317
|
|
362
|
Total
liabilities
|
5,486
|
|
5,543
|
Stockholders'
equity:
|
|
|
|
Preferred stock, $0.10
par value, 15 shares authorized, none issued
|
—
|
|
—
|
Class A common
stock, $0.01 par value, 1,000 shares authorized, 507 and 509 shares
issued
and outstanding as of March 31, 2023 and December 31, 2022,
respectively
|
5
|
|
5
|
Additional paid-in
capital
|
22
|
|
15
|
Retained
earnings
|
12,856
|
|
12,588
|
Accumulated other
comprehensive income (loss)
|
(222)
|
|
(299)
|
Total stockholders'
equity
|
12,661
|
|
12,309
|
Total liabilities and
stockholders' equity
|
$
18,147
|
|
$
17,852
|
COGNIZANT TECHNOLOGY
SOLUTIONS CORPORATION Reconciliations of
Non-GAAP Financial
Measures (Unaudited)
|
|
(dollars in
millions, except per share amounts)
|
Three Months
Ended
March 31,
|
|
Guidance
|
|
2023
|
|
2022
|
|
Full Year 2023
(1)
|
GAAP operating
margin
|
14.6 %
|
|
15.0 %
|
|
|
NextGen
charges(a)
|
—
|
|
—
|
|
~1.8%
|
Adjusted Operating
Margin
|
14.6 %
|
|
15.0 %
|
|
14.2%
- 14.7%
|
|
|
|
|
|
|
GAAP diluted earnings
per share
|
$
1.14
|
|
$
1.07
|
|
|
Non-operating foreign
currency exchange (gains) losses, pre-tax(b)
|
(0.02)
|
|
—
|
|
(b)
|
Tax effect of
non-operating foreign currency exchange (gains)
losses(c)
|
(0.01)
|
|
0.01
|
|
(a) (b)
|
Effect of NextGen
charges, pre-tax
|
—
|
|
—
|
|
~$0.69
|
Tax effect of NextGen
charges
|
—
|
|
—
|
|
~($0.19)
|
Adjusted Diluted
Earnings Per Share
|
$
1.11
|
|
$
1.08
|
|
$4.11
- $4.34
|
(1) A full
reconciliation of Adjusted Operating Margin and Adjusted Diluted
Earnings Per Share guidance to the corresponding GAAP measures on a
forward-looking basis cannot be provided without unreasonable
efforts, as we are unable to provide reconciling information with
respect to unusual items, net non-operating foreign currency
exchange gains or losses and the tax effects of these adjustments,
and such adjustments may be significant.
|
|
|
Notes:
|
|
(a)
|
In connection with the
NextGen program, which was
initiated in the second quarter of 2023, we expect to record costs
of approximately $400 million with approximately $350 million of
such costs anticipated in 2023 and approximately $50 million in
2024. This consists of approximately $200 million of employee
severance and other costs primarily related to non-billable and
corporate personnel, which we expect to mostly incur in 2023, and
approximately $200 million of costs related to the consolidation of
office space, with approximately $150 million in 2023 and $50
million in 2024. We expect the personnel-related actions of this
program to impact approximately 3,500 employees. The estimates of
the charges and expenditures that we expect to incur in connection
with the NextGen program, and the
timing thereof, are subject to a number of assumptions, including
local law requirements in various jurisdictions, and actual amounts
may differ materially from estimates. In addition, we may incur
other charges or cash expenditures not currently contemplated due
to unanticipated events that may occur in connection with the
NextGen program.
|
(b)
|
Non-operating foreign
currency exchange gains and losses, inclusive of gains and losses
on related foreign exchange forward contracts not designated as
hedging instruments for accounting purposes, are reported in
"Foreign currency exchange gains (losses), net" in our unaudited
consolidated statements of operations. Non-operating foreign
currency exchange gains and losses are subject to high variability
and low visibility and therefore cannot be provided on a
forward-looking basis without unreasonable efforts.
|
(c)
|
Presented below are the
tax impacts of our non-GAAP adjustment to pre-tax income for
the:
|
(in
millions)
|
Three Months
Ended
March 31,
|
|
2023
|
|
2022
|
Non-GAAP income tax
benefit (expense) related to:
|
|
|
|
Foreign currency
exchange gains and losses
|
5
|
|
(6)
|
|
The effective tax rate
related to non-operating foreign currency exchange gains and losses
varies depending on the jurisdictions in which such income and
expenses are generated and the statutory rates applicable in those
jurisdictions. As such, the income tax effect of non-operating
foreign currency exchange gains and losses shown in the above table
may not appear proportionate to the net pre-tax foreign currency
exchange gains and losses reported in our unaudited consolidated
statements of operations.
|
|
Reconciliations of Net
Cash (Unaudited)
|
|
(in
millions)
|
|
March 31,
2023
|
|
December 31,
2022
|
Cash and cash
equivalents
|
|
$
2,458
|
|
$
2,191
|
Short-term
investments
|
|
23
|
|
310
|
Less:
|
|
|
|
|
Short-term
debt
|
|
16
|
|
8
|
Long-term
debt
|
|
630
|
|
638
|
Net cash
|
|
$
1,835
|
|
$
1,855
|
|
The above tables serve
to reconcile the Non-GAAP financial measures to the most directly
comparable GAAP measures. Refer to the "About Non-GAAP Financial
Measures and Performance Metrics" section of our press release for
further information on the use of these Non-GAAP
measures.
|
COGNIZANT TECHNOLOGY
SOLUTIONS CORPORATION Revenue by Business
Segment and Geography (Unaudited)
|
|
(dollars in
millions)
|
Three Months Ended
March 31, 2023
|
|
|
|
|
|
Year over
Year
|
|
$
|
|
% of
total
|
|
%
Change
|
|
Constant
Currency
% Change (a)
|
Revenues by
Segment:
|
|
|
|
|
|
|
|
Financial
Services
|
$
1,476
|
|
30.7 %
|
|
(3.4) %
|
|
(1.4) %
|
Health
Sciences
|
1,433
|
|
29.8 %
|
|
2.9 %
|
|
3.5 %
|
Products and
Resources
|
1,118
|
|
23.2 %
|
|
(1.1) %
|
|
1.4 %
|
Communications, Media
and Technology
|
785
|
|
16.3 %
|
|
1.2 %
|
|
3.9 %
|
Total
Revenues
|
$
4,812
|
|
|
|
(0.3) %
|
|
1.5 %
|
Revenues by
Geography:
|
|
|
|
|
|
|
|
North
America
|
$
3,545
|
|
73.7 %
|
|
(0.7) %
|
|
(0.5) %
|
United
Kingdom
|
478
|
|
9.9 %
|
|
5.5 %
|
|
14.4 %
|
Continental
Europe
|
461
|
|
9.6 %
|
|
0.4 %
|
|
5.1 %
|
Europe -
Total
|
939
|
|
19.5 %
|
|
3.0 %
|
|
9.7 %
|
Rest of
World
|
328
|
|
6.8 %
|
|
(4.9) %
|
|
0.9 %
|
Total
Revenues
|
$
4,812
|
|
|
|
(0.3) %
|
|
1.5 %
|
|
|
|
|
|
|
|
|
Notes:
|
(a)
|
Constant currency
revenue growth is not a measure of financial performance prepared
in accordance with GAAP. See "About Non-GAAP Financial Measures and
Performance Metrics" section of our press release for further
information.
|
COGNIZANT TECHNOLOGY
SOLUTIONS CORPORATION CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS (Unaudited)
|
|
(in
millions)
|
Three Months
Ended
March
31,
|
|
2023
|
|
2022
|
Cash flows from
operating activities:
|
|
|
|
Net income
|
$
580
|
|
$
563
|
Adjustments for
non-cash income and expenses
|
187
|
|
296
|
Changes in assets and
liabilities
|
(38)
|
|
(553)
|
Net cash provided by
operating activities
|
729
|
|
306
|
Cash flows from
investing activities:
|
|
|
|
Purchases of property
and equipment
|
(98)
|
|
(120)
|
Net maturities of
investments
|
292
|
|
801
|
Proceeds from sales of
businesses
|
—
|
|
19
|
Payments for business
combinations, net of cash acquired
|
(409)
|
|
—
|
Net cash (used in)
provided by investing activities
|
(215)
|
|
700
|
Cash flows from
financing activities:
|
|
|
|
Repurchases of common
stock
|
(222)
|
|
(474)
|
Net change in term
loan borrowings and finance lease and earnout
obligations
|
(1)
|
|
(14)
|
Dividends
paid
|
(150)
|
|
(143)
|
Issuance of common
stock under stock-based compensation plans
|
23
|
|
31
|
Net cash (used in)
financing activities
|
(350)
|
|
(600)
|
Effect of exchange rate
changes on cash, cash equivalents and restricted cash
|
—
|
|
(6)
|
Increase in cash, cash
equivalents and restricted cash
|
164
|
|
400
|
Cash, cash equivalents
and restricted cash, beginning of period
|
2,294
|
|
1,792
|
Cash and cash
equivalents, end of period
|
$
2,458
|
|
$
2,192
|
SUPPLEMENTAL CASH
FLOW INFORMATION
|
(in
millions)
|
|
Three Months
Ended
March
31,
|
Stock Repurchases
under Board of Directors' authorized stock repurchase
program:
|
|
2023
|
|
2022
|
Number of shares
repurchased
|
|
3.2
|
|
5.0
|
|
|
|
|
|
Remaining authorized
balance as of March 31, 2023
|
|
$
2,575
|
|
|
Reconciliation of
Free Cash Flow Non-GAAP Financial Measure
|
|
(in
millions)
|
Three Months
Ended
March
31,
|
|
2023
|
|
2022
|
Net cash provided by
operating activities
|
$
729
|
|
$
306
|
Purchases of property
and equipment
|
(98)
|
|
(120)
|
Free cash
flow
|
$
631
|
|
$
186
|
1 Constant currency ("CC") revenue growth, Adjusted
Diluted Earnings Per Share ("Adjusted Diluted EPS") and free cash
flow are not measures of financial performance prepared in
accordance with GAAP. See "About Non-GAAP Financial Measures and
Performance Metrics" for more information and, where applicable,
reconciliations to the most directly comparable GAAP financial
measures.
2 A full reconciliation of Adjusted Operating Margin
and Adjusted Diluted EPS guidance to the corresponding GAAP
measures on a forward-looking basis cannot be provided without
unreasonable efforts. See "About Non-GAAP Financial Measures and
Performance Metrics" for more information and a partial
reconciliation at the end of this release.
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SOURCE Cognizant Technology Solutions