Docoh
Loading...

CTSH Cognizant Technology Solutions

Participants
David Nelson Vice President, Investor Relations & Treasurer
Francisco D'Souza Chief Executive Officer
Karen McLoughlin Chief Financial Officer
Tien-Tsin Huang JPMorgan
Lisa Ellis MoffettNathanson
Edward Caso Wells Fargo Securities
Brian Essex Morgan Stanley
Jim Schneider Goldman Sachs
Bryan Keane Deutsche Bank
Bryan Bergin Cowen
Keith Bachman BMO Capital Markets
Rod Bourgeois DeepDive Equity Research
Call transcript
Due to licensing restrictions, you must log in to view earnings call transcripts.
Operator

Ladies and gentlemen, welcome to the Cognizant Fourth Quarter and Full Year 2018 Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session. [Operator Instructions] Thank you. I would now like to turn the conference over to David Nelson, Vice President, Investor Relations and Treasurer at Cognizant. sir. ahead, go Please

David Nelson

and a everyone. release copy quarter XXXX company's operator, should for now, have fourth results. year full received of and good you, By morning, you the Thank the earnings

copy a we Executive speakers today's Officer; not, have Karen on you is on Chief cognizant.com. have D'Souza, our Francisco are McLoughlin, available call and The website, Chief Officer. If Financial

to the to with over the and to risks the to and earnings filings comments to call your in made the statements. Francisco are I begin, that uncertainties D'Souza. you like as we of forward-looking other now remind the may turn would some company's described questions like responses Please today's SEC. go contain These on would I subject of Francisco. Before call and the some statements release ahead,

Francisco D'Souza

Good thank morning, results. Cognizant us. announced year This QX joining morning, for XXXX and full everyone, solid you and

in serving stepping year, our down leadership had company smooth as less a planning here plan from my board's considering I've than XXth as We the effect you've anniversary privilege the in as two which forward to also years. team informed co-founded for celebrated XXXX. my sometime coming Last I years. processes, its ago, my of spent the seen, life announced, half leadership assessment XX that members Cognizant, in to was I past the and I've with succession connection CEO Having regular our and fellow CEO board take weeks in transition the role

time a fully for search a transition ensure board, thought when to As orderly upon a we successor methodical embarked through came. and the my

the Humphries, will this to a strong smoothest pleased CEO have of for in possible result process. fellow the closely its I'm of saying who's a phase to and Vodafone Committee, in of more to Cognizant new my terrific in and Executive with of of working ensure directors Vodafone say year. is of choice morning business all speak April be lead minute. Brian transition. I'll the effective X executive to that a this member is about I Brian announcement a the CEO forward Cognizant look Our Group's him of growth. that next I Brian Brian that is

Mehta. provided roles. do, I thank tremendous for Raj moment to the Cognizant has need years for the entire his colleague my accomplishments for two and clients variety for XX CEO. want yous thank a Before with of years as than President past the I particular, skills take of leadership, in to a and operating to two-and-a-half and team Cognizant, and my President begin been our passion the the tenure My more past in long-time Raj has of Cognizant during decades with global operational

has We are step leave for President the Raj new over contributions years. in the to global my his tenure. such behalf shortly endeavors. CEO proud Board, energy I our future arrives. what after of from He's as his decided success grateful Raj well during the Cognizant challenge for company build and to worked the and and to has countless I'm On to team of role Brian growth of wish to ready skill his a down and with

and clients guide to than we've $XXX than XXX-fold, the billion. trusted million base from XX,XXX from proud Fortune to our company's its performance transform grown billion, talent we we've $XX over they era how from Over billion value as at mainstream transition improve up you of less to our period that significantly during sustainable technology Investor IPO, market to And digital a to XXX. the Day. XXX,XXX Cognizant generate our And associates. needed of I'm have with new now November creation, strong revenues next and of $XX stage to approximately set growth outlined especially their capability $X.X scaled scale, growth. the the next we've Cognizant past dozen as in they and businesses We’ve as distinctive years, more we served many from as the our invested adoption operational moving for one since the annual increased for and to of into partner value

recognized services fact, which portfolio, we've footprint, ensure that and seen before. to our compelling is of clients evolved provide capture than team larger leadership our nearly aspect geographic we knowledge, have as Fortune others an in we've domain the that world's our honor several have of every past milestones company: and global this local Magazine our XXth culture, even others the a In match. can years, delivery, over our accomplished industry and us any We're value to in the one methodologies, and recently opportunity, our able companies our as market been we've for foundation, few a named strength the the to in been that gratified to team admired most this row. services year best the lead business the of It's privilege

Business is economy on At across which future, X, with build-out So is on board the success transformative the our the approach has driving Brian on profitable We board, run my full-time and has on businesses Vice my global be effect in When to the will Chairman Brian search to XXXX, Executive Until fiscal then, well view the he that will Cognizant's Brian's CEO the to role roles. entire Brian growth record help billion start. consists he customers, as be Vice transition time for I'm right approximately baton and ensuring support me technology, come. is revenues the to for role all continued I'll and first Chairman knowing BXB fixed had technology track process disciplined and the remain in of successfully and and Brian's as agenda. the to Chairman. and large-scale mobile Brian full get and as long-term The of which hosting of commitment $XX a the to actively running IoT, Cognizant's concludes, our execution the in to to CEO. once the portfolio global fully as geographies sought I'll that off future has that of and pass the with focused the I'll on X. growth. drive our to our clients, him still Brian example transition cultures. companies, for someone and success of experience, current embarked to industries, and execute continue responsible roles who cloud organizational annual April multiple bill. to and digital And committed services. as Vodafone company fits day April security Board growth on Vice a

and the XX% quarter, shift revenue continuing company now business. through strategic full an a our $X.XX and currency. Investor few and I'd Starting by was update highlights above up within our range, ago of months plan, Day. range then in nearly like QX mid-XX% to three we revenue And with digital on to to guidance followed on over billion In our the X.X% is year average year-over-year well XXXX. comment grew introduced revenues. the our revenue at digital constant total for run Turning I'll in reflecting QX, guided

average our $X.XX. of EPS quarter the the digital services above portfolio generated Our and non-GAAP for company margins was

the grew constant to billion. in whole, currency as a For year revenue $XX.XX X.X%

for discipline the year, shareholders growth. the our our year, $X.X the base across We client greater acquired instilled During And revenue through to invested company significantly program. we operating the our and simplified for capital diversified and return business returned roster billion companies. we and five further

Let's to turn guidance.

quarter X% a X% falls be in we revenue within revenue constant X.X% growth to currency, Investor growth XXXX, range of expect be Day. a we medium-term defined For And of at we constant the to X.X% in currency. full range year, the the within expect for to the target to within which first

from non-GAAP include acquisition-related expense Turning margin. here will stock-based from of in we operating Investor forward to recall you'll margins, measure our compensation Day and charges as

be XX%. a target thoughts adjusted I'd margin to operating our like on For now will environment. XXXX, few the demand approximately offer

prior shifted volatility. as transformation absolutely Clients technology's clearheaded to calls, backdrop and which business. we are continues we moving against digital are in to has the era on to supporting compelling being dynamic actually this business an the for As about the role economic from case referenced global see even quickly some business the of

and investing headroom for continued capabilities engineering. areas to analytics, intelligent our to core modernization, capabilities ample play six market positions. we're are our growth. we focused when expertise strong combine Our our strategy growth acquisitions offer and with And artificial And three capabilities these investment responds at six through targeted and areas practice at expansion in all to intelligence for transformation. the digital this and undertook. advanced the To for as during and their leadership continued profitable solutions, we automation, board of CEO I six well kept front mandate have These The the as process platform continuing to process clients growth. Investor geographic engine journey for industry diversification, and aligned interactive, our and as we distinctive our to outlined mind delivering strategy help speed selection November scale, build to client directly digital deliver Day disciplined

am I into turn best of transition. over course operational am scale ensuring to confident give presented and an the that and continue the So approach I'll you update we Cognizant's globe. I fortunate proud continuing I'm the work of are on Investor Karen the shaped our he With and to ahead. stature company days both look a on opportunity Day and how performance. our across a Karen? I how to transitions associate by Board Cognizant's strategy day I call the perspective close to financial CEO lead that the And role. to forward every do the will want by smooth who of to at to as Brian's direct expect to market the saying Cognizant's

Karen McLoughlin

which to of Thank and largest see standard QX had an reflect continued Financial to and our execution Services high softness by performance $XX or currency. constant slower growth. year you, few our $X.XX morning driven solid was our clients. revenue end of X.X% growth within at and adoption revenue to guided and sustainable Frank earnings our recognition quarter currency, billion banking at year-over-year revenue new full of Banking and out increased continued quarter. results were a positive drive The million rounding was in year-over-year the in at good revenue range constant the of X.X% Fourth the in strategy impact of expectations everyone. X.X%

remained spend has Day of Two at clients. the show clients we by already our our pressure course driven As we under while portfolio late-stage based And business Despite good discussed that pipeline of and rest deals, at to in going on over pressure. grow back nicely. in five pressure do largest three some top accounts, our November, our these continued banking our in other the three to our continued the the into of been primarily Investor Banking XXXX. of we've Banking growth the Banking of XXXX, clients in continues recovery expect deals closed

will developing discuss moments, platforms I markets see made for and solutions in we and growth in few a progress in markets As accelerated Banking significant in have XXXX. expect European those to the

mergers was clients Healthcare, the several large Moving Bolder of underway. to currency. constant with which and third-party ramp-down continued our with temporary provider the clients Healthcare a potential is where were from a by year-over-year spending on the not which in work subcontractor contribution in excluding yet we Healthcare and account Growth grew in to X% an associated slowdown involved payer integration with impacted a

into to We continue QX. expect this

care engagement delivery data-driven collaboration seeing increased model, from is providers payers Healthcare a focus across with we shifting and insights. and fee-for-service effective value-based consumer that's a As to on partnerships are

weak investments have we long-term. and have quarter strong quarter well manufacturing and good had in typically growth showing and XX.X% of in is industry take and were in QX growth to Products our year-over-year we advantage while growth Healthcare, period believe for this the seen shift positioned another logistics So, a us Resources those both slower the We industries. retail that the pleased what with in of constant seasonally over in currency.

needed journey with you Let chain example challenge of convenience the in the guest concept A the combined of transformation their U.S. finding, leading of me first competitive. They classic the including of app fast-food locations. location of and with XXXXs to doing viewing, menu It an order the the redefining all we this drive-through in order launched XX% increase work online concept kitchen, very elevate Cognizant supply operational in are increase help was and on-the-go that's technologies pioneered segment. franchise give experience strategy facing X,XXX-plus to digital saw clients helped efficiencies an purchasers stay management convenience. been ordering, overall along initially and to an develop deployed now customer digital average value. chain payment, When restaurant and across mobile app changed has the tools. service, to

Communications client and AI higher XX.X% with close Media Our very on details Technology segment software repository services, deals. the engagement quarter and year-over-year expand of story. product-related had about churn Communications Media information reduce recent strong or and analytics The more drive growth Technology and our currency, other key and tells in to driven customer additional of achieve another and customer company sales. central accounts major lacked subscription software renewals segment A In constant sales technology costly client to needed for our issues. our transactions, the clients. by in past a decision-makers A needed its percentage words, however, of

this machine big develop our predictive accuracy, customers learning partnered with know And analytics our and XX% the the of and customers here predict enabled in to today retain been and to now and identify born last take in proactive analytics, the steps and at time. team receptive Our three for the leader market. analytics one Cognizant you churn to learning automated are client just client at entire central so most the able to space is over some product practice connect we portfolio. repository an with its high-value This data patterns we've top been upsell. was and to dots years, a cross-sell example across XX is we've of this Many data and that high-risk, consolidating may analytics of spot behavior cloud-based and the customer that data applying work. customer Using AI client machine to position predictive

banking of currency. grew Now moving continued by X.X% constant grew to larger currency. on in to in constant world Europe of year-over-year clients. in impacted be some Asia-Pacific rest year-over-year in negatively Geo's. weakness The the our Results XX.X%

We've Europe investments by in serve. us local both the Our strong organically given inorganic operational solid have markets adding in geographic footprint roster, growth. grown which expect our continued expanding new a from we and organic we talent our centers delivery Continental and client developing footprint and

Acquisitions in number have Our Switzerland energy ramp-up in organic in accelerated Mirabeau communication service strategic banking, life and Benelux complemented ability and of sciences manufacturing, as Netcentric, and the sciences, of sciences banking our been Zone in Germany clients the region growth entire in technology. France and Nordics with banking a transformation. of our across our life digital Hedera, the and client and engagements enhanced media have range and leadership in their such and life to digital with

digital clients revenue are credit transformation require presence bring significant deep and and expected These transformation. for the As coming core industry opportunities I cloud include banking made progress specifically Europe. which and expertise earlier to mentioned banking, local we These for sizable solutions in solutions years. have operations, platforms in developing solutions

digital of over driven Banking tax previous This appreciation transformation and acquisition a have to we've our that recently primarily Temenos foreign Finnish the financial XX%, related Act the guidance guidance core platform margin, shared the three example and Oma institutions: XX.X%. Hub issued to Bank tax opportunities rate. provision Group, POP will their primarily Savings XX% regarding guidance Plc Tax plans. Temenos for Indian partnership our expense, a foundation lower an Shifting for Bank the in loans digital deposits due Group transform the and enable banking of exceeding QX Bank quarter banking than compensation was rate on income As than Payment The based to with An second announced transformation, now guidance Reform is GAAP was in expenses EPS and ABN operate net of charges only More by realignment as core we acceleration TXX to term $X.XX, to a will Finnish Savings gains and with to AMRO and of example be of due the markets and support across transformation. the This was cloud Non-GAAP text enter provide provision we of of fourth led GILTI transformation revenue a similar non-GAAP global quarter, lower will the beginning IT of which XX.X% in cloud pipeline expanded year. of longer new exchange Clearing non-operating enable rupee tax the opportunities will our partnership our other Europe. of is of a stock-based XXXX. by reversal infrastructure the managed platform. growth lay not partnership Further, excludes the accrued a but Non-GAAP margins. XXXX. in earlier expense good incremental this operating help

growth year was full billion guidance margin with our EPS revenue the currency. For of $X.XX. XX.X% $XX.XX line XXXX, non-GAAP of And approximately of in or constant operating X.X% Non-GAAP in X.X% represented XX%. was

As Investor revising XXXX in definitions. starting we we our at our are Day operating margin non-GAAP and November, in presented EPS

Going EPS under related compensation expense year the exclude and adjusted was When full was will XX.X% margin no $X.XX. XXXX and margin adjusted forward, the acquisition new operating our operating adjusted calculated longer methodology, EPS expenses. and stock-based

and offset continued strength several Consulting where benefited of as from metrics. we technology and and Now subcontractor previously Softvision ago. turning Consulting demand strong outsourcing QX grew third-party. down XX.X% revenue healthcare customer year of a in X.X% a of services of revenue a represented to to acquisitions quarter. inclusion of the technology Within year-over-year ATG services continued growth Digital outsourcing, and our from our the ramp a the revenue and services digital XX.X% for grew services other for outsourcing mentioned X.X% such partially were serving Operations, and by we the as saw recent solutions. Consulting

and made now from XX% improvements of transaction with but million from fourth unit attrition $XX During QX, from continue remains solid of XXX. more And contracts or simplification of shift in total basis margin operating opportunities the annualized the focus XXXX rupee ongoing price operational In continued by over contracts efficiency number the We allowed of of points rate at for the a such structure, the revenue full structure annual the which our while improvement and improving performance on on came From added to us in of absorb of This generate strategic to as our seven that by target. function elevated. further a spend. increases more allowed contracts QX the investing depreciation we business revenue as levels total our not least to continued margin portfolio year years Indian achieving brings defined we update higher-value and XX% corporate pyramid and improved quarter, less on In within based strategic expect talent services, revenue. XX% the year million also higher benefited to continued to position. our quarter, of clients the strategic our to declined potential a approximately operations. versus of growth. in those ongoing basis fourth remaining we've a the in do quarter, our margins customers in at promotions to us XXX over profitable utilization, the long-term $X moving large ago hedges, of XXX fixed non-GAAP The in our reassessment margin build were our an quarter, be quarter. last two perspective, to people discipline also points improvement our profitability and overhead operational wage effective and business underpinned of leverage Net business structured to our our

workforce continue the to pleased and rate the are we focus in overall on While, strategy our with attrition management. we decline

was XX, finished Turning million to year short-term December down XX, the debt, from down healthy. from of XXXX. December this balance Net We and cash which by remains $XXX with $XXX billion of XXXX. our balance very million sheet investments, $X.X

balance flow India million. with Tax As These the short-term a Department. cash ongoing cash related amounts of our reminder, in to the billion the $XXX the $XXX times. Income X generation to was as of On restricted free income ratio dispute strong just year includes over investments We are had restricted cash basis, cash quarter full net million. flow $X.X a free with of

of was was the Our outstanding there debt no quarter revolver. balance outstanding $XXX balance million the end and the on at

fourth XXX outlook the for and would share repurchased quarter million the for XXXX. diluted now the to on quarter. we I comment million decreased and shares year our count approximately During to QX full our shares X.X like

on exchange XXXX, to in For we the X% exchange. a points current our X.X% grow this for XX reflecting growth of of foreign translates year to currency. X% X.X%, full expect to assumption revenue negative rates to constant Based basis

to the Based For X.X% of revenue our exchange currency. first to translates for growth assumption constant deliver quarter of we in negative this basis X.X% expect a to X.X% reflecting of rates on of exchange. points foreign XXX growth to X.X% XXXX, current

EPS range exchange XX% the of realignment adjusted is XXXX be items and year the year effects XXX This losses XX% adjusted and the XX% in foreign the rate our a increase of the expectations. approximately to For $X.XX, XXXX, share deliver least definition anticipates versus a EPS basis. and on full under any, gains adjustments. non-operating like-for-like approximately XX%. million revised midterm to we unusual operating charges consistent for adjusted of our and tax revised with excludes to at guidance margins full tax non-GAAP range measure, expect shares above rate our tax other a This count provided net currency, of and if Guidance

the account and as such in tax. areas also regulatory from shifts environment, guidance not the does immigration impact Our including for

and to Day X% that about balanced per flow close We The at payout our allocation of should approach reduce dividend repurchases. on share of our utilize for us dividends by XXXX, are free annually share outstanding November. XX% annually. the Beginning at dividend business more cash a declared and we the quarterly outlined of approximately intend a count Investor to global for approximately $X.XX record had of allow maintain of capital This February committed to we share cash last in Board XXst. ratio to shareholders XX%

Additionally execution for that our longer-term to used enhance enhancing acquisitions strategy geographic intended be is expanding XX% In of our of our our cash flow annual growth open summary, and Operator, free digital another enriching business with along well vertical capabilities, footprint, solid the in call our expertise. global our deliver year in XXXX. us solid XXXX has to for positioned investment the can continued earnings of revenue in questions. and we

Operator

with Thank you. Please question the Instructions] At conducting with question-and-answer [Operator this time, comes first of Huang be a your question. from proceed we'll line Tien-Tsin session. Our JPMorgan.

Tien-Tsin Huang

Hi, as a on with CEO, much. want run and say, interacting congrats amazing with working you. thanks I to Frank enjoyed you so

So, Raj well. plan. guess, to I I and on best -- CEO as wishes you the want with let's that, transition to start

CEO an stood a global carrying gave What of detail him the Can on plan months three out may to Cognizant that greater international we as chosen Humphries focus his for lot as you be set experience up forward signals a good for Brian outsider? you be there. So, top ago? of infer

Francisco D'Souza

as that to we for things. think conducted lot a look and -- the a forward. multiple companies, record going He's think transformational about the of to sort a strategy what's Technology we across as regarded technologies, When permeate organizational my sort He the and Board perspective, industries, Executive just for Day assessed the of process. think successor, highly thanks strategy experience a well-regarded solid that laid what at the I he And is cultures. great core And also of is digital success track out And got thorough right Tien-Tsin take with our -- choices, all a on execute with were was power to kind Executive. -- every I'd the Brian technologies, roles, as we Yes, set choice. of out but continues you geographies, our his the of industry. is words. Tien-Tsin Investor we company global say focus I couple focused on really client to

Tien-Tsin Huang

it. it, got Got

I can So, outlook maybe question. quick if a just add

big of XXXX, differences shape like consistent pretty growth achieved looks see fiscal what the outlook It XXXX. guiding the versus XXXX. and about thinking up the here, you top Just you end you're how in to be might

Karen McLoughlin

I that's So, fair Tien-Tsin. think

we that term as to to back about near-term in grow perspective, be more near talked growth X% -- would midterm end on that If thought X% we you right, an range. and remember the the on And organic range. Day, at near be currency Investor to in up would move lower we at we'd and acquisitions the continue the of add we then that constant

the accelerate really growth the that second growth QX so of consistently to my obviously, some the comments, recovery where no in and new year. into about then we're nice full in think get the shift trends, particularly quarter some slower year, we general seeing banking, this we're outlined markets, and European we with talked we which see the little are think very terms obviously we continues a for Services of starting But digital in it as supports rates I So confident we'll Day. recent plays what the Investor we Financial to significant as quarters. out very at is overall with as that changes bit than start partnerships in from in we the to saw year. But

Tien-Tsin

All right. Appreciate Thanks. it.

Operator

Thank you.

question. comes your of with Our the line Ellis proceed Please Lisa MoffettNathanson. next question with from

Lisa Ellis

a Frank, echo congratulations on phenomenal morning. run. good Tien-Tsin's Hi, comments. I'll

vision what start long-term you we’re all industry one question. to you're actually see next. ask think more to off curious then I to I will opportunity taking this

when changes, the that your opportunity role you years different don't we moving that those Cognizant, industry Cognizant's CEO and moving are ways you seats you the things into perhaps IT meaningfully on to a positioning be in what at next we're from our -- way of not in As XX have will relative do? comment see mind out distinctive five the to the -- your to out services over look in

Francisco D'Souza

words. day, is of It's as that it kind a place. And XXth just been quarter again was will Thanks thinking the CEO about lot I the other the Yeah. quite this an my Lisa. as anecdote be reporting this I run. a appreciate I

as guess I would I a your here's measure you by say So to quarters. CEO I think, public Lisa, what company question. Look,

where starting mean, for technology I to so going directly integral technology set there's that being have becomes I forward, -- we're ago over and clichéd forward. moment, see, that therefore, that see as with this sound is is today. very which going I really continue not a societies context, our line at really technology firms capabilities budget that decade going and I of so And Every and to that more somewhat role why see that think think outlined really enterprise. already to will but think just business of I a I budget may enterprise be the Against the think saying to are Investor on technology like often a to that's really technology a a more and look essence and to business years that even we've six capabilities clients. that back we up to next play Every from governments it that of say ours the considered need supporting XX difference of that we're five, Day technology at to so important. every a and and really leader. but now was been this technology going we're of can businesses, pervasiveness the forth. inside as leader just the is when you the office I is it businesses

at I If you every represent the group that need enterprise what big capabilities a market they advantage to core embed of look represent that into as them their as their into But if you deeply is them set, business, believe look capabilities, their opportunities. scale. going at as a they can fully to operations, as take into digital so they really P&L at individually

the going technology this how across to have organize of respond to trend And at and think decade. services to so, I yourself of that core enterprise the scale, notion the business you how a be respond this really will the that pervasiveness to you over idea coming as businesses digital services is of

Lisa Ellis

And inevitable surrounding imagine question, we'll I then session the in months, couple some follow-up, suppose. reform. Congress HXB Great, new ask my inevitably as visa With hear the of two-year's thank over I'll noise you. maybe I every next

those perhaps dependence out about Can just has mind on workers are to just residents or the now what you of percentage your over put of get at can reducing Thanks. of some U. over you before S. I couple gave Investor of that, years, see the ahead HXB made your highlight proactively citizens So noise the last that permanent progress I that maybe of statistics believe, top etcetera. couple of we coming recall, any you Day Cognizant next visas? months?

Francisco D'Souza

shortage significant really needs answer world competitive. questions the Western the the of always I remain with the which United Europe a the to is Look economies to in of many is addressed reality many Lisa. Thanks that immigration stay be parts technology -- which big start certainly for that, picture of to is there these States, parts talent in

the first world economies the -- technologist maintain edge. the as we competitive question part really these back go to your -- you to more skilled becomes need If technology-intensive

moment progress. residents. say is Day citizens that, workforce permanent or U.S. At XX% North North to make or continue the American our We we you let's in our at with of America shared workforce over Investor

continue in be We progress I over expect make that we'll to significant the medium XX%. and well term

Karen McLoughlin

I to just we U.S. add in is the training can last million -- to if I funded launch programs Lisa, set continue with Foundation as our U.S. And think, more $XXX up this which we I to initially you’ll If and mean recall I year Karen. that, think

biggest said, other not of in the talent obviously of but Frank here, as world just shortage is parts challenge As the well.

So coming years. on certainly to we are the change focused that trajectory helping in

Lisa Ellis

you, Thank congrats Frank. Terrific. again, and both,

Operator

Wells comes next of line Securities. Please Caso your Fargo with the Our proceed Edward question question. from with

Edward Caso

I color Hi, accounts of them. if to you was your good morning. give curious could XXX more strategic

over you. goes are Thank point of $X maybe could And us color quarter? Just as over than, other above this bit million? you more desired at the $XX give million? up a array many every it how $XXX seven peers like them your some to little million of Sort

Karen McLoughlin

Sure.

this is Ed Karen. So

run $X actually annual most of accounts All $X rate. million considerably them an million and on are are of those over above

range We accounts have is we doing XX the -- XX of not this this broken many top -- off point. but out about head at it $XXX accounts million, how in have over of the over my

So, there's a fairly large the over years. emerged number of significant clients that has

Edward Caso

Thanks Right. the back to group Frank. on you get these Healthcare transformational deals track. and of And sort my Congrats sensitive of sort other question to large is on are the Healthcare. to How winning

Francisco D'Souza

large the continuing majority transformational with methodical business Look are our to this Finnish spoke winning in projects built of announced Thanks, large small that on with clients recent the that quarter Ed. think don't to and The built and idea other deals. many, our We'll in of banks. Healthcare this That's a about in with way. so verticals, medium-sized of to grow each platforms, is a to transformational transformational the into on and deal -- plays on on vast the That strategy, forth. -- client usually Karen it's involves three many any do I grow. whether continue dependent We and we example so continue or is this deals deals. great

to out -- is doing but the built not I assumption those I forward so Cognizant we're those an or deals do to engine deals don't to certainly business on will that think rule grow. going And the continue don't going

Karen McLoughlin

traction certainly a of been not to to lot move obviously can it may which way just now quickly. said, to the particularly support last to you that could and out deals, TMG able talked so be to onboard this smaller right, meaningful And actually large add that the you a you that have also being opportunities that enables to historically the a deal we little quite TMG build I able in accretive and EmblemHealth they Frank add able become if really forth. the now client I the with Ed, quarter we bit, launch feed starting smaller certainly smaller I see to think and with engagements platform the deal, But think, about not with we're clients what platform capability relationship particularly want so a lot and after and and faster

We as So, been we get point, And at underway had number that's bit for planning that's of move business. are that bit that some a expect talked clients some little of are of we recently of that integration. our certainly point, commences, the execution integration seen certainly few thought overall as obviously that of Healthcare a once typical. integration, those a will to fair the in happening over they side mergers and we that we pullback last work certainly about, in the But share said Healthcare. happen seen the at would there's we've that into have then in And weeks. while little

Operator

Thank you.

of question line Please next Essex the with comes proceed from question. with your Stanley. Our Brian Morgan

Brian Essex

Good morning the and for inorganic contribution Karen taking -- maybe quarter. you if could you if the thank on wondering question. touch in

activity You a it and fourth that active continued sounds this quarter pretty guys year. deals you into with had like

might quick how the contribution the year. anticipate the I a follow-up. contributions have remainder of is what we wondering Just and through And

Karen McLoughlin

Sure.

completed, QX, year basis revenue. full was also QX. versus it that year-over-year perspective. about true in in was points guidance our XXXX. a includes QX about basis XXXX, for on that also so again year-over-year contribution deals see about we M&A And is will is on of That the XXX in in points XXX But XXXX that basis points you XXX which a have So, basis already

talked then XXXX we XXXX, XXX of Investor for done XXX our new so that and be about expect basis as deals we add to will Day, beyond that guidance done that. would to would deals, new at included points we in XXXX a again we've, obviously, in about New year deals

Brian Essex

you if then touch of remarks little super a rupee That's helpful. could growth. flexibility the it. your invest on, prepared mentioned you appreciation that gave maybe Got to in of impact bit for we And the

some the little to of flipping continue that continue a if to are throughout sort a guess XXXX? headwind invest that's I for to manage measures might that's you this growth to to, think anticipating what and have And year. bit I fiscal of maybe case,

Karen McLoughlin

Sure.

have ago started accretion be allows said, to the platform really into if And where some focus XXXX. scaling little ones, our the XXXX. some support push got last to outer fourth move outlining go So the to know to had we're as pyramid we've years we be. those the more could dilutive. we deals us that starting I XXXX I we that year in mean folks two stayed on who certainly we kick hiring get quarter as then you with to as start more as to in, such of fund to which structured larger, of do up frameworks with now new utilization investments. need use, of bit Certainly We then fairly we'll consistent to deals continue margin as to room see we growth years we at XXXX, opportunities original a continue or we that and continue as we ramped get into look tend this those when into think really initially put And margin

this our growth the and we're for to those continuing major leverage as and now that talent driving really will focus right investing of to things that. in looking year So SG&A be sure and so but we're is do that at some making well re-skilling the forth as

Brian Essex

Very Thank Great. much. very you helpful.

Operator

Thank you.

comes next the line Our Jim Goldman question proceed with Please from question. Schneider with of your Sachs.

Jim Schneider

go question. you their slowdown an much environment running been? your are your now. of for Clearly worries are Thanks overall on the same customers right But maybe or from And of things you're morning. Good Maybe about hearing maintenance. more your into phase they taking we good or spending off in have digital spending overall signs career. Any on talk can you they XXXX? next posture Frank spending pretty luck less around pullback to as to the on and start my economic in IT course just as IT

Francisco D'Souza

trend as comments, organizations, the the what to been up invest a Frank. we business, clearly dollars for permeates it's as in new I free on IT you importantly is think types I see to I able in to growth. in as what think I I are going and order said Jim, running on in a you pressure my Look would said Equally tap budgets. traditional an maintenance as activities said, of traditional while. has That into environment as think technology prepared of

a budget said, all whether opportunity budget, now I it's it's the somewhat R&D the budget budget, marketing for us. sources every whether new of is technology As become almost these of

larger. never been overall, all expand so And organizations. permeating aspects opportunity has It market think given continues I of our technology to

the macro on relates and seen it it as environment I forth. clearly relations impact for with so Europe, so in out issues I China haven't translate demand into think yet us. meaningful a concerns on in there to various there about and are

this solid see I point, when And think so at a environment. about I XXXX, demand

Jim Schneider

And Thanks. a then maybe up. as follow

kind itself? particular, the Financial base think what's that improve specific would Services in your address I can improvement QX. couple sustain seeing Karen in well? in you client Regarding banking what the deal in And maybe that I in financial guess referenced just as to of a wins outlook confidence in you're trajectory your U.S. of level of

Karen McLoughlin

Sure.

as talked we're So a the signed for and as closing deal confidence, Jim we just about waiting Finnish so deal, that. of of for terms clearance the example final in

deals close in pipeline have we're here. very that the to finalizing similarly We other

what actually going So in as well the as of we we're the top America about to as have a -- in of terms high I'm degree And relates to it talk confidence particularly then North markets X. seeing. European

where very recall Investor double-digit that and large year-over-year in of talked obviously into about had at you those talking and growth. QX continued we if growth about, we're So very continues in them cases to the Day and two QX where some are relationships. top returned That five nice

a turnaround there. So nice very it's

America are under look big the we business. pressure a has we be it North not just But pulling larger turnaround business, the The to overall then you the -- point quite for for of banking grow growth of assuming if rate those at not accounts the gets under this and at down continues three some pressure. rest some It relationships these of when nicely. to have continue guidance our certainly other And accounts.

Jim Schneider

Thank you.

Operator

Thank you.

with comes Deutsche Bank. question the proceed next with Keane Our from line of your question. Please Bryan

Bryan Keane

a CEO Can bit the your the more some with of services IT or change. surprised background competitors. background Congrats Frank. for an a of little -- industry I about didn't hire to I'm Brian want right of you peers somebody talk one isn't from did the ask why it the was executive just Cognizant? the outside little about or necessarily

Francisco D'Souza

Thanks Bryan.

all technologies the Brian As And geographies, the that search that before, mind as Investor few board very we ago. months and is a that think strategy he's as industry. of we roles organizational during success Day determined for the at put conducted together the of executive. we that I think continues terrific executive in space, that, Brian is when across right technology strategy obviously said before companies multiple to you Day every We permeate carefully got very cultures. digital just our I outlined the we went industries, that in themselves, we a We power as methodical kept just for on the successor. to in And a the execute my said of sort through we for Investor track process outlined you right that record

Bryan Keane

you're so with helpful. XXXX? know since calling I of X% down in on a bit about X.X% heading Financial for you the pulls maybe X%, just momentum range And already little thinking the Okay, thinking at that's of quarter about is running improving then guys to X% guidance, high guide what came touch and in the about I revenue Karen have not constant and in the X% -- fourth higher XXXX into the just and a towards end currency. Guidance the Services guess

Karen McLoughlin

of now a I I the the what think, made Day. obviously, see we're said year, mean Investor is half that the growth is start in although, to year. And bit outlined guidance little this very will obviously to right consideration. what certainly certainly, ramp consistent support the consistent -- in investments things the think little think on prudent at Bryan, with a very like back I we're and we puts comfortable year. year. earlier take as the I to is particularly But the we we back we with range with full which we this of into comfortable, pressure we But this be QX soft we've to November evolve, for

Bryan Keane

Okay. right. Thanks guys. All

Operator

Thank you.

Our next Bergin & question Co. comes with from the line your question. proceed Cowen Please Bryan with of

Bryan Bergin

Thank morning. good you. Hi,

clients costs and tight Regarding in how this to on the labor digital ability your on then through? capabilities? you efforts, particularly your levels comment pricing environment, those are can around onshore pass hiring inflation And responding

Francisco D'Souza

hired talent like-for-like I that which said some the U. once like at couple here of two isn't you in meaningful is, whether look a talent sort if the those Visa, talent on On costs basis, would or things in past. there we've locally base a our a S. all-in say a cost difference sort will, of base pools. folks you of between

are, we from So, a cost standpoint, indifferent.

are Of -- course, in out. I in you as tight said market pointed earlier, a we as a constrained

And struggling like-for-like, always so need find But given are the talent we our all-in, the to we're that costs the growth about to same. our for the demand services, ambitions. fulfill

Karen McLoughlin

and that I'd to talking think [Indiscernible] I just little And pricing. Yes. bit a -- about add

versus high we talent is that hiring always the not skills are that has seen skills XX obviously clients that So, or a and environment that a you'll XX last big come with do to like-for-like in in seeing you're in That's now as need accommodate as and Frank actually I demand, What get and flipside -- way. certainly the change see said, I significant that. But we're the wage do much this -- think true, price. is so. this no given is don't hot years a as different we've think you inflation pricing

quite because about year pricing last So, quite And, the we pricing some year remained had market year, as was shortage fact, that continued. you of in and actually consistent. I trend strength last talent in that the a has while think first of has talked the in

Francisco D'Souza

of a Karen cost margins, But out pool our from average continues thing digital digital despite at that portfolio And as look to I talent the above which fact run when to we that and general sorry think company revenue -- ability in. part drive there to is is to remember of the it our I'll maybe at -- business running digital add jump in has pool. talent the speaks higher last pricing, the in pointed the that back

Operator

Thank you.

the Capital question. Our proceed of Bachman with Please from Markets. with next line question BMO your comes Keith

Keith Bachman

Hi, thank you very much.

him HP Frank, know his First, on congratulations days. from I Brian.

a terrific choice. I think he's

As getting a matter of fact, of could somebody bit. I help think from quite outside industry a certainly Cognizant

in if that, founder of on that. I a as little you're a the correctly the bit company question So said you success press have years. My tremendous release the number over congratulations of different read was

like it move doesn't You're the which leadership with sound But to capabilities a transition seat I on the unbridled are have going Am reading eventually new you board when correct board leadership there particularly get plan situations, I to to Frequently direct in that? they in period. after strategy. on doing founders to think new comes to the allow that? off

Francisco D'Souza

we than Keith, that goal bit fellow ensure sure to go and is to really I whatever as company make my Brian that. only sure commitment board that. my is and and that the through transition successful that whatever And more beyond and members to my here the that happens, do we is to primary to make incredibly will is necessary a role not necessary play that is

come. an whatever world our members my commitment absolutely commitment my ensure the my to that play around to at to to things I sure we as XXX,XXX transition. all have of smooth shareholders, But that board the to power to so And my make that is and my moment we will associates you, in is do fellow is fellow

Keith Bachman

fair enough. enough, Fair

I the the the But just and top hard My predict XXXX. to both in line Just of one it's and right is that is it's XXXX? neutral assumption XXXX. both margins nature in in XXX understand Karen. XXXX. on margins line the for a is XXX to it that assumption I to help because want the was to know depends neutral contracts. you XXX the top in the

Karen McLoughlin

make But will we assume That -- assumption a neutral. it’s perspective, And is in breaking longer modeling Keith. That we disclosure. no Yeah. a it was that just to a not fair one-year out. requirement from be will XXXX

Keith Bachman

Okay. Many thanks. Cheers.

Karen McLoughlin

Thank you.

Operator

question proceed this DeepDive the come gentlemen, from and Bourgeois Ladies with Research. you. last line of Please our Equity morning your with Thank question. Rod will

Rod Bourgeois

And there. comment. Hey, I’d last echo the

great see occurs couple wanted hire, to thinking is think I so things. of Brian to being it's I in and nice change context besides and global a that anything a that be already new reconsidered? any guidance about change as might the expect you CEO related targets Do on. or to more CEO announced? the ask expect And related financial one to you also management that's the do the been departures

Francisco D'Souza

Rob, it's there. to your Frank. parts Multiple question

operating his Cognizant. we company, think about just When first Raj I contributions the just years. $XX spending Raj, that, over we passion just served a of of And the success revenue. for for really last say minute a leadership, think all million joined to he's $XX me it's growth President clients that to and year, know to of X.X as variety Let worth want skills, has as were billion countless to thank our say for Raj you roles. decades provided I for two the in And in past that over from operational Raj as

future contributions his and thank many company Raj, I to call this his the on many, in many, him wish acknowledge So just endeavors. want to well

I Thanks, we going We're guidance. I for again, call. provide joining I and look positively do we to as you those for at know I to when that. very So, transition ahead of is you have will for to we the performance the truly guidance I XXXX outlined thanks think of else and want Brian or the be -- forward. everybody. forward am case that our once on year. bring that view the this. you factors of guess, role. our based our And that Karen? this on those our Brian or think to board. much, as during Brian add considered the negatively he will you many, and we having with point done influence our don't providing comes his sure that always all and continues perspectives as today, anything to the updates have targets best with he's the to all that, the to introducing interactions we've XX enjoyed the many XXXX in, quarters the you could to to that will in best business over and I've this I've days process for I you all view are

So thank you very much.

Operator

concludes today's you. Thank teleconference. This

time. may your You participation. at you lines for disconnect your Thank this