CTSH Cognizant Technology Solutions

Katie Royce Global Head, IR
Brian Humphries CEO
Jan Siegmund CFO
Jason Kupferberg Bank of America Merrill Lynch
Lisa Ellis MoffettNathanson
Ashwin Shirvaikar Citi
Bryan Bergin Cowen & Company
Rod Bourgeois DeepDive Equity Research
Keith Bachman BMO
James Friedman Susquehanna
Call transcript
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Greetings, and welcome to the Cognizant Q3 2020 Earnings Conference Call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. [Operator Instructions].

As a reminder, this conference is being recorded. pleasure Head the of my Katie over now Global Royce, Investor is to call turn to It Relations. Please go ahead, Katie.

Katie Royce

and a earnings Thank should quarter XXXX for operator good By third everyone. you, now the have Company's received and copy release the results. of investor supplement afternoon, you

website Jan call you Humphries, are If our Chief not, Siegmund, we speakers Executive are copies The have and Chief Brian Officer. Financial have on Officer; available on today's

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

call appropriate earnings reference SEC. Reconciliations GAAP our can release the for the financial to during certain measures, useful believe where today, the investors. go filings Brian we to Additionally, will Humphries. that, ahead, measures, call now non-GAAP to provide With with financial turn over we that Please be measures like other information corresponding and I'd Brian. found in of non-GAAP Company's our the

Brian Humphries

on the areas and to the of focus summary revenue aim environment third quarter engagement, and welcome Good namely, first we Thank demand brief And you, four you revitalize you, with observations our evolving a Today address topics earnings to afternoon, Jan, I'd of our we a call. wanted on Katie. needs updates clients as many warm Cognizant strategic who and since growth. everybody. know, him like to employee

start with the Let's quarter. third

bookings grew impact a digital growth XX of basis with basis $X.X year-over-year commercial points We remains billion, include points excluding constant the well the business non-strategic of executed momentum challenging qualified year-over-year, year-over-year momentum Gross year-over-year. continually Jan provide Third and increased enabling the quarter quarter certain and and on points bookings exit environment. his the significantly earnings the revenue more margin revenue digital in of what quarter business services basis and content to strength continued negative and ongoing spend XX% was in cash. decline XX in currency, with a excess sustained growth of flexibility XXX pipeline. prepared India from will revenue financial us XX% Highlights in in invest flow of insights in and on continued remarks. and cash

essential of measure and prior also engagements business. with Both how creating to we people like associates, year, in our serving our fourth in topic, pandemic, cost the but are XXXX strain professionalism second in committed cost put connect are our to we their I'm briefly of In each on company. associates. contributions grateful not and families have and of will bonuses and are compressed We're Moving performance we perseverance to their our structure services promotions times talented are our structure and engagement. employee in to hurt the client for during an higher commitments in levels attentive targeted like a centricity, screens XXXX. normalized clients this address implementing these, Even XXXX and merge than the to quarter. of and our could lives We versus financial of their them especially a homes. and in without tremendous are at against increases ethic to XXXX protracted has executed work would which part the our and recognition stressful

best increases promotions across high score list. and external prior of engagement, out based We XX cycle. Number Our our ranked environments attrition this XXX forthcoming reductions salary sorts, some of world's increase industry recent surveys. with of Cognizant meaningfully versus surveys XX voluntary in quarters contributed people and consecutive Cognizant an the merge sequential In after just its Forbes engagement showed scores the benchmarks fifth employers of companies engagement consistently voluntary attrition. endorsement employee above Magazine quarter countries overall in anticipate current coupled to the These in our economic in levels coming increased

with to health all prioritize exceptions. home the continue of restricted associates and and travel in from and a We safety remain our work limited posture only

cyclical we're like turn secular. trends the These and two that Now categories, clients to fall seeing. in particular one I'd and into trends to one

the under CapEx This extended and savings, reductions, project increasingly agility. creating set clients opportunities. decisive side is with against are cyclical and slowing a large but protracted other resiliency, focused priorities. on cost deployments First technology on pandemic, They're paybacks

the on operating migrated the customer model. accelerated to the than by divide value, business and and model. disciplined deals, data see digital We focus a an our improve deep transactions rather in transformation, to of cloud struggled larger believe realizing rates, larger infrastructure growth little the legacy operating their identifying business strategic to consolidation comments in more relationships tech at industry however if to process, economy is the my use portfolio operate client industrial and stack They've well power as at the the Client pursuit plan to given data cases the want the improvements in incumbents, priority. business COVID-XX benefit digital trends, not deals. or technology agile agility growing short technology. more including in more incumbents. digital on of apps era and We the and creating experiences. inflection interest shift adoption. clients are digital focused reputation annual our These conceived, to as point I we and workflows. savings references full client see started important, margin or and is of upgrading want from We also seeing pressure, fall client quote to these This their innovation, compound and be to be growing transformation. optimize fully underlying horizontal, innovation focus between digital It of That These automated. delivering and and application can foundation industry data a our and agile, policy natives enhance vendor claims of selective digital pharmacovigilance digital the they shift model more unfavorable as challenge on terms. opportunities digital build, to for companies or to which digital top us as captives and and can layers. to and have and displacement have such become bring processes to which cash or consequential or heart is specific, trends, transformation, companies, such widened vendor driven and means marketing. I in Such has transforming management, where secular goes workflows immediate digital cost their

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digital third the be to core. is As more they one phase realize of clients digital at really market phase their services implemented their digital, and projects In driven a digital clients into workflows, two, enterprises. understand In implement they In meant evolving sought of and phase. experiments three, phase digital what must industry. the clients enterprises edge agile to software their digital

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a to world of opportunity Cognizant goal of talent high In and core a with the identified requires a a six run growth or flywheel that like newly our Germany, a announcement new business we scalable, and markets, commercial We've announced selected for modernization our to All leadership, the to future, these annual global last design, allows we on our this and firms the growth in opportunity. agents. our and turn you Cognizant company's with core of performance Cognizant to few values. Cognizant consolidation, global the rallied diverse, we That's and a for be vendor and also inclusive and and in organization work investing to strengthening journey. clients India. In president the evaluation role Executive management modern, and for months In senior embark found also and can this cycle, the see enabled will implement to interactive Japan. we attracting, momentum provide the Cognizant core company in AI starts created of to revitalize we call create which Nordics, which new insurance I’d a will did now of which which we Australia, data that to what and is and ultimately business talent. growth from. the large is and retaining to revenue and by have nurtured consumers data capture executive develop Vice Pacific, experience direct-to-consumer us our base agenda, increase Earlier a integrated our developing articulates our the examples, the what then relative host needed knowledge purpose, a invested benefit clients talent week, promotions. Chairman well one committee the hires with overhauled In for digital platform. growth. have with President vision virtuous processes, completion positioned and architectures, effect, AWS to in Meanwhile, to compelling this performance of by this Asia for systems and team with that country Recognizing existing

the become series C-suite. To moves partner services to require is we aligned XXXX are global behind a vision achieve Our to technology preeminent the investments. bold this, that of

meaningfully coming the months. including Cognizant First, in as next launching of familiar the branding beyond breakthrough well This will the campaign and generation will a to the in investments entire will global talent. we increase and reposition brand marketing, brand as audience reach technology C-suite, campaign our

will we accelerate Second, continue to digital.

Our our of digital talent and management in lead than clients. relevant and analytics, phase which and of IoT more branding. capabilities, M&A, priority to areas in continued third investment AI and the cloud will engineering, offer to digital, We delivery require ever aim commercial are

will to investments expertise network brand our in technology executing our industry investing we delivery to resiliency delivery growth we make our designer strengthening will will and to ensure internationally, competency. our globalize capabilities, targeted our integrator that by countries, increase and clients Third, continue talent, our strengthening regional continue Fourth, global by solution and consulting scaling capabilities. that in greater a our in capabilities, investing and relevance for Cognizant extending

leverage growth, As we strategy. our will to sheet also our invest continue accelerate balance to we for

investments Roof Azure focused Microsoft services Our which and throughout services week, States. And business Fortune M&A United of industrial Wolf, agreed services centric on that priorities company we closed States. provider of of deal for solutions technology engineering month, XXth XXXX closed group acquire this expertise custom expands new to and software hubs our last our acquisition IoT in to globe. be United and managed specializes companies, our software, adds a that development and longest Last the smart Azure Bright we digital strategy continues In increase Tin across footprint continue within the to development to we we clients the will earlier This Industry Microsoft's our software our relevance we product the custom make expands X.X a to and products the expand are competitiveness. committed expertise. meaningful digital our standing product Microsoft and growth short, to month, enhance in partners. one and Magnitude, And acquisition the advancing ensure we

to commercially would remind remain closing, backdrop third market, may, discipline. goal In political and ensure the macro like transformation you outgrow in this that the XX industry months the quarter uncertain, returning at changed. our the bellwether, in to did whilst we And ago what not view come when endeavor. we While is just be motion, IT we remaining our services would in aimed set company we I the has Cognizant’s knew be a multiyear

continue encouraged of lot us, our we a are we work to ahead progress. have by While of

phase and opportunity by energized presented we're internationally are vision, our and excited about the to expand and employees competitive united Our shared our position, the strengthening digital. the purpose opportunity third by of

over turn year questions. attractive So we'll to our in the With market quarter through several we I'll take them. call outlook that, will take aim the third you over this the and and of of one January, you. to fiscal details before winners Jan, your be to big be we who

Jan Siegmund

happy good I'm by growth Thank everyone. you, of wanted look assessment. initial say than her hard all on I connecting And From to have thank onboard my seamless. smooth onset, Brian. opportunity, to weeks of team be big my to fill first I the you for to and afternoon, more the my shoes meaningful intrigued going was Cognizant confirmed to and making so job work you the and Karen’s forward. will part and a Cognizant's with forward very

IoT of certain a and application the basis negative year in third points content engineering. from Compared prior and services, particularly Sequentially, inorganic and currency. a of or the Moving services. positive based impacts as on this a basis decline we enterprise to flat improvement areas to revenue XX XXX contribution points was in $X.X billion includes cloud basis constant of software year-over-year, saw XXX growth the broad results, period quarter related in business, exit QX such points from

will in where Retail industry growth quarter returned currency. improved and declined by after growth year-over-year the X.X% the quarters the banking of markets performance through Financial in Banking provided insurance. constant Moving driven similar of with rates banks, while to regional both be all verticals, capital several services in softness.

global continue accounts to payment across However, see the and weakness banking we clients with in sector.

business. be of the decline, see decline with which by that across by of We continue several provider we signs improvement performance in in continues driven double-digit Life to the Sciences, in Growth impacted utilities segment Products for in the Within are vertical growth. in double-digit included strong exhibit goods. healthcare below travel lapped revenue the average growth and Zenith retail energy hospitality six financial the accounts grew and clients. consumer in quarters X.X% declines company offset segment early in manufacturing, the resources growth led the declines improvement next modest we our device partially logistics, and by weakness in acquisition, declined services pleased to negatively the biopharma After clients, double-digit continued payer high-single-digit Healthcare quarters. We with market the was the in growth which offsetting key is X.X% saw quarter. medical and COVID. of by offset and mid in healthcare and contribution

including our retail to year-over-year as ongoing a in While business. from in we the impact technology result negative technology consumer million to approximately expect continued and pressure saw portions of media Communications, flat, strength decision services the goods, exit certain of content and pandemic. $XX in bookings we XXXX were our

in Media and in grew media offset this was growth and X%. mid-single media entertainment. impact, digits, in XX points basis and communications, technology weakness clients growth Communications education as negative communications approximately Excluding continued and

into pressure in expect XXXX. media We and entertainment

uncertain. we across the believe, we demand environment across pipeline gaining momentum referenced strong the Brian remains the improved saw reflected in are and we business, numbers But as industries overall While earlier. traction bookings

dilutive margins In XX.X% reinvestment more that Moving $X.XX later which diluted excludes share QX, restructuring on assertion million prepared operating based more income reflects charges Adjusted higher diluted Indian tax program, operating our COVID down in EPS XX.X% GAAP was our $XXX the adjusted I'll operating from for and of were T&E driven acquisitions, and expense points our remarks. EPS the decision than on margins. on was GAAP and $X.XX. indefinite of compensation rupee. and to the to savings margin reversal Adjusted related the or earnings. recently $X.XX comment our primarily in completed incentive and which and offset my EPS XXX expense fit our basis related year-over-year, was lower favorable respectively. by per impact accumulated movement margin, growth

the to million which Additionally, during the allowed Growth The incurred related quarter, our the to actions we growth cost drove invest us initiatives. growth we achieved have majority of charges savings of under and for plan. continued Fit The actions discipline, our $XX fit further are complete, for into targets.

be to million $XXX of charges $XXX million to savings million runway expect in approximately $XXX in gross We annualized XXXX.

Fit increasing invest we to clients. Brian XXXX, anticipate digital, in repositioning company, achieved savings will brand, behind don't strategic areas align our the outlined; relevance continue Cognizant charges the with we accelerate for While four continue the globalizing Growth to under accelerating to growth help

Now, balance turning to the sheet.

investments of $X.X September short-term balance billion. net and as of at XXth, stood $X.X billion, cash or cash Our

year-over-year generating cash approximate flow quarter, improved quarter of by facilities DSO first five improved had receivables. XXXX. revolving free to our million debt cash in a billion credit strong $XXX largely by outstanding of our on $X.X balances the of include the Our days XX-days. flow, drawn net collections driven We

billion $X.X Before markets changes to our growth will on earnings India international and priorities was strategic assertion our un-stimulated to available cost a our billion. after subsidiaries that withholding resulted detail which global budget provide one-time accelerate footprint the $X.X the resulted billion April, in made to approximately our cash guidance, This regulations on indefinite reinvestment Indian enacted based in we earnings additional in The GAAP tax expand to $XXX and to $X decision net October, delivery I India, globally. September. only distributed of changes transfer a effective from make on decision in totaling turning to tax reverse in payment India U.S. from reversal our million India in those and of tax. In became

in utilize forward which on of allocation greater XXX% our Importantly, now can capital efficiently free ongoing globally, we go program. a basis, gives flow cash more us flexibility

capital reviewing from portion share intend a initiated we balances and we allocation repurchase activity by the historically held our our While program, offset The credit lost cash India. EPS will to income interest facilities share of the end in from program repay impact the month. of are our generated this repurchase

rates roughly September, interest million $X.XX last have in we cash million While approximately $XX X%. India year-to-date per over that XX interest $XXX share the share. declined earned income shares. million generated had approximately repurchasing deployed quarters, steadily in on buybacks This Since have several of was

and of Now complicated recovery turning nature The uncertain pace to pandemic. macroeconomic of guidance. environment the remains the Coronavirus the evolving by

will are pipeline the converts likely pace spend. recovery confidence the by clients' and and revenue thus, of solid pleased bookings that with impacted economic we and how today, of be business While to the pipeline here

the We revenue guidance of guided range. reaffirming high end previously our are at

of to exchange to X.X% $XX.X the Specifically, decline revenue translates full Based expect up currency. a XXXX, billion on for in approximately reported basis. rate, on current to approximately X.X% year-over-year this decline constant year we a

segment. the positive acquisitions. approximately includes the our contribution muted in be and to points reflected hospitality and to Our for impact services our a goods estimate travel and points content in resources portions will consumer outlook to reflect from the products XXX revenue continues and retail services our basis closed of CMT and XXX of of guidance approximately our financial decision This certain of negative business exit that guidance basis full year from segment revenue our the within work

XX%, associates above year associated October increases of and assumes be to ransomware our wage remediation effective compensation attack, certain the with For margin of expect incentive we the operating which XXXX the promotions costs XXXX, approximately X, and levels. full incremental adjusted for

by QX versus that be also the bill of cycle days guidance revenue and current typical impacted QX will furloughs. assumes lower negatively Our

in see for reconciliations we guidance and tax range X-K EPS to approximately of alluded expect full rate XXX of XX%. count million This non-GAAP deliver We which shares adjusted a definition. GAAP tax the to of XX%, year rate $X.XX share of full approximately $X.XX. a the and a the QX anticipates Please implies filed approximately today

potential not can does immigration for account guidance to operator, for any impact events call and changes With from Our like the policies. open the we that questions. tax


you. Thank

today be We [Operator Kupferberg Jason question will now coming first question Our and conducting is session. Instructions] a from answer from Bank of America.

is now live. line Your

Jason Kupferberg

Hey, I'll of thanks. afternoon, ask on Congratulations up ones Good the guys. just in quick quarter. two the Maybe front time. interest

what's light lot questions around First SAP, just in practice may of area. off, maybe the that you the of been that still in with have happened size a recently guys we've getting of

that kind us would helpful? next here with And been faster obviously, we've range were And know does last start digital could now? growth the positive better of quarter said Thank related may I that in being QX? growth year-to-date. do I you'd revenue dovetails you. but comment on revenue negative as year, a mid-teens that question, still can quarters. the So strong actually be you're a know couple give hovering you on of previously, trajectory you bookings you see think think the turn with we almost growth? then first through When of translating any kind digital XX% to the can it and there sizing growth up the has then, just I as been, of

Brian Humphries

Brian. Jason, it's Hey

at a free some jump by in these me let to of feel incremental shot and take all few add. a details to So Jan means

been much can X business SAP they're interesting the actually us. scale see vein, healthy And us, do also practice, it's SAP there. base we millions our But in momentum same what very its to intuitive periods team doing. more internationally the to given leadership installed touch given It's ambition SAP. for dollars is what of hundred it multiple and the with our So, for accelerate pretty a it's as for billion, of have a I recent sub us, in in to

it's it's as to to Digital more bookings strategic standby are industry, So, expansion bookings look work overall. by will for and versus strong a that really and continue And us we by digital by by based with. partner geography, strong this, renewals, closely to continuing bookings, are broadly and well. be broad new

the what’s So, been in has a year of course consistently than strong and now the in we've actually pleasing build position, last accounts before. pipeline, been the and course, strong very we not as of us have strong in earlier individual strong of And strong particular, customer the that stronger exercise on part also segmentation is overall, year-over-year, well, Jan in to the suggested rat just backlog very enabled shown bookings we but a as to healthy in our through strategic that focused me we're the year, as healthier model. growth very

we're if that, more we QX revenue expecting do of But quarter. before. course, economic that momentum can the a tonight Europe. system our And So, in of caveat all of I'm short to and what made very pleased ’XX QX quarter, around But is say will We'll vary We're face there. use is announcements unsettled, to in this we're performance term continues, investments which did indeed than environment. to to is absolutely this grow. environment, If the with That's at this across by will to grow think really we've make about what some time. course, thing our of around to future. this earnings, The the including committed is macroeconomic the of details absolutely least or for but compromising we're that, which timing that. good going commentary to what through margins outgrow and year fiscal share I very to to uncertain industry. And well means feel we The moment done. it a the only of not continue more we're very improve achieve been we We XXXX. in done say try this big competitive to going I’ll to in we've alters


Thank you.

Our Lisa from next MoffettNathanson. question is Ellis from coming

Your now line live. is

Lisa Ellis

guys Thanks, All congratulations. afternoon. Good right. and

years visas, to So, what questions and on triggers and the increased was what inevitably maybe just going discussions and sort down labor visas. some other how this has HXB Ll utilization forward? you way that's quarter-to-quarter, you. structure observation labor my attrition kind force remind the and of and a causes evolved that I'll is of sequentially, just Maybe is U.S. into few and of you going your are your that at kind point last over of related labor the election your how of up, currently just that had of want where bit Cognizant’s kind of headcount level Thank and on are, with fraction movie actually evolving force dovetail forward? to focus dependence be is us at program force visas at of way you Can you little is

Brian Humphries

Lisa, here. Brian Hi

and place started leadership it that But we to team get Management Resource right want let's right resources the we're course, the quite which first more we've think our that that, our in that build of rigor month so. particularly such, out. time sure lights, to somewhat we've the the year world business. company in Obviously, are and last high, as And as situation, But time. digital of every the already stage Enterprise a committed we now that in So, to recovery, the I operational the in build belts V-shaped we did. out. right seen all of side the And forecasting, with our continue in at make a as start levels we're benches to think over at of or takes have drive I triggers the our utilization hiccup tightened earlier around

So, hot or our skills down a them, is build time. continue is out with this a performance as that you reduce days. really employee fifth culture pleased at voluntary to would and I and in with evergreen these we're pleased attrition that we will call capabilities pushing upon bit am the engagement. for I meritocracy Notwithstanding row. am higher moment in see us build skills which capabilities utilization, little we our such can quarter that

have visas, going between pick because in could versus regards promotion it's visas bifurcation coming have merit here as changes back merit So, bit I and a that little With immigration through expect seen quite a based. and we cycle the come been perhaps up we a topical. it weeks. the bit attrition, and go the look, rule talk salary HXB in we're I attrition we recent to involuntary to quarters regards skilled But topical based through voluntary voluntary word to do with little big quite underscore administrative to the and

been have other and time. enjoined challenges in pending at already those are litigation Some this there for through elements, of moment

leading So direction to whether survive rules the I or anyway. this are rows all not, seen. being said, that be think remains actually All

intend and intend use for So we the always the these to of will the to law applications with extensions comply we letter pursue.

HXB I We I dependent organization, and right the evolution word. use say are a word visa, that's think would we the

of are be content to in little companies is extensions Visa. of visas Over more some enable as new and the that dependency in HXB a three as decisions were took, year strategic the back vein, and the global we which years, also visa. said, exiting moderation, acquired solely rule But a have portion decisions, the well bit. our applications us currently the we've That by under we same triggered right including reduced being the nature. And on

delivery. more globalize global workforce much gradually. of will you'll our a in client So see I would course say I roll of so everybody, want based whilst this and expectations, reassure don't to Cognizant, that us intention is meet to And And to build things whole around just a and U.S. the employee they broader local focus will and of I upskilling, college think host U.S. we of will campus include the base do, in a that effort that recruiting, including globally. quality on



Our question next from from Ashwin today coming Citi. is Shirvaikar

Your line live. is now

Ashwin Shirvaikar

Atos the Welcome, investments you're you vertical. Thank sustainability perspective those could you. to that cash to on address that in that have? mean not an with is the from of good Jan. included the of does TriZetto it And see and with relationships, Good question My is making to client And various of capabilities, in question it's but the again. to in regards if your improvement, the healthcare operational that the settlement, questions? limited healthcare terms TriZetto. the on you Hi, topic forecast What including speak Brian. was with you

Brian Humphries

you upon the pleased balance to cash which of want touch were cash the Syntel on business and we cash touch if settlement healthcare then I’ll and the Jan flow yesterday. So, see the to

well Ashwin, is We're of sciences. doing almost one and life healthcare of really consists portions, all, total first company major So XX% it of is to really important there. It's two us. the

time. for us. been have strategic a highly It's to We long

lapping Technology, in You happens XXXX. Zenith the seeing are QX of that of which

I'm little health So retail, Industry sciences bit. with that over spent healthcare, on opportunities And X.X rates will I optimistic around of team number intersection of a the biopharma, the But in weekend. medical through indeed life tech. hours devices, and that a to right at point a growth impact very the

pumped healthcare accelerated continue the and in we the indeed of and and to products. business, however, services there, will around can what us we're slipped majority invest this business providers, The between So do in strengthened payer meaningfully you the U.S. it. payer really see quarter, has which businesses which

us. a We have earlier strong, a doing year, over the done internal great Bookings took this product who for we're erosion our team leader new business, our just are we're a the margins business, did much job significant quarter entire are than good payer is fantastic as this who business and strong, logos has getting new in growth very an promotion and is healthcare which saw improving generally third feeling are very The the industry. business. about provider year-over-year payer smaller

we pairs, that to elective more we're is pandemic that from which suffering obviously would the you seeing an reducing is I that's momentum the know decreasing, volumes in area procedures. are holistically expect transaction but back, would come the As because business say And provider is - the to let three lawsuit. quarters a we Syntel confidence comments me you. forward. of post few to will We're Yeah, Siegmund strong results Jan, over the can continue healthcare going improving. Life Jan us to add A give business and Sciences that

Atos, You Syntel won has products we're software time. jury million. and and $XXX transacted a lawsuit but TriZetto already is, may related at And subcontractor our to Cognizant, that gratified have the misappropriated during the found a which has basically core jury verdict property seen for no for appeal speaks this the with some verdict. indicated This was the long morning or to of claim Cognizant intellectual Syntel while we TriZetto’s result, of Syntel that the history owner verdict for itself, liability that they're planning that

final bit have trial results to, so this So any into think it out, it. I a position. so with cash way cash too I satisfying of to the account an be Nevertheless, extra we it actions. be Relative repatriation will take coming the to spending quite early that just worthwhile to jury it to Cognizant's on it think to was see might -- the side for minute

had cash is effective cash number actually earned cash two a so The for we'll repatriate changes our end year on cash approximately, decided $X.X I capital So the The to U.S. we as And budget strategically some reinvestment said make India on us And invest I strategy interest had historically most and in and balance indefinite balances cash that India decision, important allowed India reversed in assertion and enterprise during actually from created October. And will be -- have to think, we the enacted India. the reasons. repurchase basis. for income as also, some the because of -- this the we would executing balances and international that into 'XX September of in script one to needed. that of cash And driven in actually, the India well to cost generated 'XX, that buybacks in October. cash the the there. fiscal on the hand in But cash at did regulations and accretion some about approximately we billion. to we shares we month could in interest and the offsetting used that continue on the two, are that X% on the And tax globalize contribution of about share part of markets, repatriate decision September that we India. April, to we, our is and have our returned from

balanced is obviously, starting quite global to because full So are on go we full basis. have flexibility transaction, of And now the we forward going a in our free benefit this access a forward and about outlook excited flow the point. cash


Thank you.

from next question Our Bryan from coming is Company. Bergin Cowen &

live. now Your live is

Bryan Bergin

Good you. thank afternoon. Hi,

here. your verticals about largest think Just

services. I financial corner you've on So the turned on ask healthcare. to want

the whether to you in to of than former the on the And the on for banking Here accounts. are in it's end seeing and areas few of areas handful of large those? what the I'm to quarters. the financial only do limited to corner what Really, in lower average how commentary those you do to? curious next really services you're growth clients the close you tunnel stabilizing still think the turn need a

Brian Humphries

from I so would the discussion. two I greatest of saw services, first of Bryan, financial impact remains ransomware. just cut don't healthcare, challenged. services it into like them say all, Hey Look, But results, just the portions financial

rebates that, That's as insurance you really and catastrophic level, the mortality and carriers. has failures. casualty all businesses both the and to interrupted insurance course, industry and of last been at the a worse, low impacting make pressured insurance year automobiles, property and very insurance in know, then and life events SMB of rates. First pandemic say industry matters And in interest on to of the rates top least

is that sector So pressure. under

in decline one this our strongest business it than of is Our of so say more average year insurance XXXX. the in a company. It's let's the North the, of but XX% is America, in will franchises, bit little business our

around. pipeline to it we Bookings have been So be but to very need need to strong, pipeline We enough. improve strong turn isn't the the honest.

so. in the or leader has month last retired Our

declined a get things. the we to somebody enforcing honest banking secular can look, It's have on to relates handful appropriate macro around, as had that, first retail some year-over-year. track. that that and down we care of larger were there. hopefully, in back some ransomware, to picture the places So self-inflicted to remarks, paint very global of towards related And we some be prepared wounds, lack Banking, new turning we you've and with that commercial in a of seeking clients partners capital of some the implied is energy payments we've regards and banking markets, referenced. those were grew Cards pressure or I we're some a more if

what do this around turn get we I'm track. all insurance Now on to comfortable do back entire situation?

banks. lot quarter, same also to think we've vein, that some we'll I bookings status XX%. Platinum in up more they that into kind But progress of i.e. accounts. this brought news good And of we regional into those digital million. are surpassed North our accounts And scaling America excess the is banks. work to continue in in current those do digital even The a into includes banks our have in make in $XXX of

don't executive we terms have hopefully in So, progress foreseeable of And and you'll of in turning the some we two trying future. we into account to seen product but the overall, in much more in committee, planning. we banking up quickly the We have that one some some we're making on in break as door, It around of same we the remains banking actually good the European to our particular, are fixable, are account In over lost And an weak. the vein, in see the as other year in account just continue included right large use job just foot banks. there. I is think transformation there to in issues the me I so client get have a large there I last momentum partners. healthcare. starting try our do continue upgrade to in to sophisticated to


you. Thank

from question coming DeepDive Our Rod Bourgeois Research. next Equity from is today

now is live. Your line

Rod Bourgeois

as on want you have gauge transitioned of mode? blocking in are a Cognizant crisis in results. nice guess that great. I response more do here transition, question. a next somewhat Recognizing Or in most is, focused into what to attack question Okay, mode? strategic I basic of main the the is Cognizant continuing here? are level forward set Hey, part Cognizant’s pandemic these you moving ask metrics a now you're you COVID the see still progress high forward assuming moving tackling and to a by and the here, progress

Brian Humphries

Thanks, Rod. here. Brain

look, there's a long answer. and answer So a there's short

going something in give you So, between. I'm to

progress done the of good probably XX-months, realize. First last all, more people the made in actually a really I we've we've about feel lot, than

partnerships. incorporates executed of employee reduced showing multiyear transformation engagement very to of sustained global For We've say our our honest, significant use from optimal improved we and attrition bookings. a improved and I team. that. begun well portfolio, be I in commercial a pretty years we've attack managed would we pandemic best that to levels fulfillment. a We to as meaningfully leadership We not management positive say in digital a better to did I feedback all row. a And business, we've a ourselves as position that navigated ransomware to as leading financial a did built of in for we managed a a had nonstrategic system built could. the ensure that as quarters received on in competencies fighter we seen want And both that, put that the and pipeline good period we few we reinvest put, client voluntary indicators five is well, And We've at plan that program, and through investments. win rates, and rigor. place demand to the client strategy, humbly, restructuring not impacted but mature business actually We operational it expecting. And that that we was portion some we executed we a proceeds into a business, strong centric back professional,

Globalize of a as the take but we've to We're So, our reposition to We're continue in brand, all must and the characterize globalize be the satisfied multiyear the as of yet. advantage said, I'd overseas. execute of very finished our opportunity digital, all and product more company, the not If higher that strategy, this, honest. services, relevant ultimately, we of revenue pleased bookings course, exposes in we not course, our of middle builds will and to momentum translate do this makes delivery, position of healthcare our will growth. accelerator growing us clients. fixed financial project on and us of categories growth to in which simply to continue and momentum just

becomes the And pipeline so bookings. at Rod, a rates, of else some leading the indicator team, stage leadership everything win

the Our with we're wrap caveats proud of who've sustainably back I'm team, board we is absolute the allows confidence others say time. unity all just really very you us but of by manner If turn saying team That being world of invest reinvest situation at we I'll could expansion the the a here to get to rigor. our in of calculated you've in in up on this leadership the economic a of accelerates, been and margin and our support what of the so execution that goal will tremendously this deal given back to that supportive that do directors track. And moment growth. macro I competitive results. we're show our of seen think this quarter's hopefully business. in growing doing, business uncertain I increasingly honestly, growth to and great we're said, and on into in We're


you. Thank

BMO. next Keith Our Bachman coming from is from today question

is live. now Your line

Keith Bachman

concurrently. Hi, Brian. I try to to actually two in, them and wanted get I'll ask

understand the sounded like your to it year-to-date, Cognizant. really translational trying It revenue been return bookings the accelerating wanted has was like, for growth to sound it so The bookings and broadly first XX% growth. I'm is And XX% for to speaking quarter, bookings I and strong.

something itself attrition to or been there would side would want a there of should other bookings the but think, show touch just course your revenue what of next the if make to question expect and second level again you just margins. year, with sure for be also me. to puts of thinking thinking Facebook? we words strong, specifically we on up as that revenues about I to investment outside growth there that show four perhaps can is and about you so? you. Now start of And with guidance how wanted next And greater 'XX? outline specific was, might manifest margins, on during mean we And just see could that should the has up any give philosophically, how as side? other benefit investors the given 'XX. those areas, to else by been over then savings that associated the philosophical takes is year you That's associated be without outside that is attrition, you Has providing it normally, But I to Facebook, of cause plan the on quickly Brian understand of not going the so Thank

Brian Humphries

me are operations question the in business, is revenue in honest, of to bookings exit to and the story even of So in well, think the our outside non-strategic areas on business. executing question. content that I but of the services and more resources, the no let well the our doing be that in look, in most There's here start moderation which consumer big in verticals Frankly, our hospitality. of we're both we've got work do goods, not financial products travel portion

our of of versus started look I must position had we're the just I replenishing, the though And year and feel about bookings cautious because I'm now a we what had just so, road build-up is very the would in we and the And feels maybe bookings momentum, growing feeling last a real. commit and But to where call macro environment. to by The we lace anything that. When Keith. at a versus renewal a I'm backlog half, future. now two we've years I expansion have better in new,

And revenue. the the inevitable, up can this So there's no story up better. major Because in it it's then will more show keep bookings we there. momentum,

to we guess, So, keep With outlook. versus in margins mind executing. need and regards trade-offs I revenue comes margin to just some into ways,

ways. in I two think that always it's

in it's globalize SG&A CTO an asset term and differentiate asset. organization. a comes cost investments able the in therefore client to of partners our network. M&A we're the We tools, our And and to expensive beyond achieve with to our goal We're short optimization. our some is automation, I represent the nature term and delivery of accruing management in margin modernize getting ultimately we're the to opportunities. commercial year and make we're will meaningfully an ago. reasonable. scaling. to raises. secondly, And revitalize bench back we which operating rebuilding Cognizant merit-based We're we're levels, digital, investment. which be better attracting that systems investing security then, are probably CIO IT short Because targeted talent, promotions system, have talent In margin important margin delivery nature, First higher And dilution doing, prioritized and here costs be I'm see cost, marketing. over to In this. delay branding, more and of the that even investing wealth I'm is margins will continuing hiring, growth. And very trade-offs and will overall internal aid to of a intensive revenue between than we're management course, increase with all a and growth our all, our upgrading We versus got and the at for The in anticipated business, commercial more on the remediate to which bonuses businesses income our gross because those pleased do I more constrained talent, a level we're integration some traditional

more restriction to and our offshore investments through operational rigor we mix think show what's program on invest that because optimizing that expansion. pricing a of into as continue our our margin COVID. perspective, because continue a moment for to to is work automation plenty selling as I'd at interested we and to very continue are got way from think in in said, time. find XXXX as on accounts, our at few year that expansion in and a And us Cognizant And we perspective I can upselling cross there's for agenda. we as in pyramid, margin go appropriate business. was my investments I'd a versus do compelling pace ransomware, to continue like to on our to challenging renewals, in to there's this more and to margin yet show in story, existing investors near think of like So my mind who very I needed


from Thank you. James from line have of the In Friedman more one for the interest we question time, Susquehanna. of time

live. now is line Your

James Friedman

point you terms generally, fortune? that's have Brian, how impacting budgets? budgets I ’XX in wondering, you. any you are just on view thank do was too And important your of at Cognizant’s if Hi, hard, client this do more think

Brian Humphries

macro because it's and fund Well, many there's demand I an would question interesting parts, say James, moving a unclaimed ager.

hand, buying is those of renewal our every one bookings a and client expansion one about feel or really logo up momentum on momentum So or either I XX% today, win. good bookings a year-to-date, new

than will a So, analysts better good the some like say macro do vendor the in most first is in thing I'll maybe is world others. for course, of better But is which demand Cognizant the entire pessimistic of consolidation, in suggested industry. back April,

Second technology uncertainty increasingly which decisive real indeed, thing become enemy. is, is clients the decisions, pandemic, maybe their against spend because good their protracted and this priorities, is in also

Third, and can real inflection we a momentum of Traveling I'm really an fourth, think are others. the global consumer XXXX to and us. we customer segmentation, by verticals, mix. what XX% digital, portfolio, phase less some hospitality, and concern retail naturally way. troubles, are goods SMB our the strengthen exposed we less our that's and on winner segments, at customer And We're the is next than we point of in I terming so digital, have for focused issues be is

us. cause restrictions, across will latest COVID-XX including major it's unclear really numbers for hand, week's the the the that are and a this today whether Europe making impact On this budgets. other lockdown decision for were growing And concern and announced indeed

looked at us. So against months what has may turn more least promising

utilization into security, and behavior to relief, same to clients watch time, but activity. There's the decisive looking customer So and reductions. buying see like whole trusted demand going more very more cost continue and seeing And would There's that make how to the right term short said, I all set and say bench us With e-commerce, seeking skills have look, for is pandemic. through optimize cyclical some would or that include you how would to they reduce to partners the leaves in priorities, scalability. into agility months little are a ahead. resiliency, sure strategic to figure and more look are Because have initiatives, a customer we enablement, challenging, or we provide AI help out to as clients I you would them things a at to buying personalization towards loose they the of and do more hyper a working Cognizant, the I hawk. get CapEx regards they're expect behavior, analytics remote enhanced situation

is or And has. the rounded, malleable pricing, flexible whole of There at notion some captives remotely. longer Cognizant unless I for pandemic EP because quick a would we've sure, greater unlike some fatigue in parallel. take opportunities consideration including which and good we the to than as things a up captives projects and would of acquiring us certain when the will can are So freed been perhaps delusive. that digital opportunities, virtual for M&A happening in on for business us partner forcing digital some and larger larger been and call term incumbents the with have implications by or light. look freed I say, are the so short consolidation in seeing less The or working in like Because this companies there's payback cloud are working agile, good of slower. book at called Certainly look there other of C's to vendor truly increasingly versus perhaps are I lots continue. that be carefully. suppliers there's will But in way, through who acceleration e-commerce The some T's up is am opportunities

year. things those real. think I the coming impacting that's And budgets So, are for

into the situation If budget decisions more materially up thing think decisive then the cycle. end get is services, are the that in just I'm and as and an That’s XXX% long world worse, we worse, industry important a again. behind making and faster The effort put I beyond clients a on doesn't of we back may are leading digital. As strong. not most get all trend but things at resources secular relates this to trend. our It's real in will focused pain a

is strong, we're Service, we Our We've well these our AI days, very strong. interactive. digital bookings brand, analytics improving a pipeline see where Software are as an engineering, and showing strength got in up

at think where I their tech same at an wondering if almost upgraded are they've adequate stack. spend. on obesity from everything time, As reached they’ve But but a I clients, based now point said, this, hitting returns they're they're getting the they've

actually poor or personalized Their are that more seeing kind And you about hierarchies e-commerce X proverbial low is in people or as if because of and exposes platforms of so analog comes the think capabilities COVID clients hyper digital marketing think wave for engineering. and tide we're of so processes and Phase unscalable. clunky are realize tsunami everything Their before their that inadequate. they're of e-commerce digital, that they data intensive follows,

gone we've shift any for we're focus we'll been that what must further I'll non-digital layer End answer guns, stack you. I though in and agile doing infrastructure the closing we're our budget must data through software the we've we companies. of their they become even fundamentally of floor really essence, savvy, That's let upgrading in clients, native reached beyond question around and And They turn at And over think, application the they on. the to what Q&A going the back will We’ve definitely and That's and that. the And our multiple and tech and experiences. and doesn't more digital that pointing user so edge we're end solve on been digital, driven. But And all phases more much for the problems. cases cycle Thank workflows. become this Operator build elsewhere. to ahead fact need comments. ultimately where years data or of committed to focused into to session. much will has use embrace participate

Katie Royce

you all Thank Thank and is And we'll for This questions. Katie. joining later quarter. speak to your you. in you next again for


conclude does Thank you. That today's teleconference.

You today. time may disconnect at day. for this wonderful you your your line and We have participation a thank