Revenue increases 4.9% and Cognizant's Q4 net profit increases 18% to $648 million

Cognizant Q4 Profit Jumps 18%, Revenue Up 4.9%; Sees Steady Growth Ahead

IT services firm Cognizant Technology Solutions reported an 18% rise in net profit and a 4.9% increase in revenue for the fourth quarter ended December 31.

The New Jersey-headquartered company posted a net profit of $648 million on revenue of $5.3 billion. In constant currency terms, revenue grew 3.8% year-on-year. The performance met the company’s earlier revenue guidance of $5.27–$5.33 billion.

Looking ahead, Cognizant expects first-quarter revenue to grow between 4.8% and 6.3% year-on-year. For the full year, it forecasts revenue in the range of $22.14–$22.66 billion, implying growth of up to 7.4%.

CEO Ravi Kumar S said the demand environment may not see fresh spending cycles but expects vendor consolidation. “It will be a wallet-share game,” he said, suggesting companies may prefer fewer, larger partners.

CFO Jatin Dalal said the outlook reflects “sustained momentum,” supported by strategic investments and the company’s AI-led growth strategy.

Financial services emerged as the strongest-performing segment, with revenue rising 10.5%. However, communications, media and technology saw weaker growth. Geographically, North America grew 2.5%, while Europe and other regions expanded about 4.2%.

Bookings remained strong, rising 5% over the last 12 months to $28.4 billion, with a 9% increase recorded in the fourth quarter alone.

Kumar said tech service providers are yet to fully capture the value from AI infrastructure spending, leaving room for system integrators to grow. While AI tools are changing the software industry, he noted that real business value still lies with infrastructure and enterprise adoption.

For the full year, Cognizant improved its operating margin by 1.4 percentage points to 16.1%. The company added 1,800 employees in the December quarter, taking its total workforce to 351,600. Overall headcount grew by 14,000 during the year.

Despite modest hiring, revenue growth outpaced workforce expansion. “We added 4% employees but grew revenue by over 6%, showing non-linear growth,” Kumar said.

The company also plans to hire about 20,000 fresh graduates to strengthen its entry-level workforce.