Cognizant Reports 4.6% Revenue Growth in Q3 2026
Cognizant's third-quarter results show significant growth in revenue and earnings per share, driven by strong performance in Financial Services.
Cognizant's revenue reached $5.7 billion, marking a 4.6% increase year-over-year.
GAAP earnings per share surged by 148% to $1.39, with adjusted EPS growing 7.2%.
The company revised its full-year revenue growth guidance to 4.0% to 4.4%.
Cognizant Technology Solutions has announced its financial results for the third quarter of 2026, reporting a revenue of $5.7 billion, which reflects a year-over-year growth of 4.6%. This increase is attributed to a robust performance in the Financial Services sector, which saw a 12% growth compared to the previous year. CEO Ravi Kumar S emphasized the company's commitment to integrating AI into its operations, stating that over 50% of their code is now AI-assisted.
In terms of profitability, Cognizant's GAAP operating margin stood at 15.4%, a slight decrease of 60 basis points from the previous year. However, the adjusted operating margin improved by 30 basis points to 16.3%. The company's GAAP earnings per share (EPS) reached $1.39, a remarkable increase of 148% year-over-year, while the adjusted EPS rose to $1.49, marking a 7.2% increase.
Bookings for the trailing twelve months totaled $28.7 billion, reflecting a 4% increase from the previous year, although third-quarter bookings saw a 7% decline. Cognizant's Chief Financial Officer, Jatin Dalal, highlighted the company's disciplined capital allocation strategy, which has led to a free cash flow generation of $1.6 billion and a share repurchase of $258 million during the quarter.
The company has also announced its revised guidance for the full year 2026, projecting revenue growth between 4.0% and 4.4%. The adjusted diluted EPS is expected to be in the range of $5.72 to $5.79, indicating an 8% to 10% growth compared to the previous year. Cognizant's ongoing initiatives, including Project Leap, aim to enhance its operational model and drive investments in AI capabilities.
Looking ahead, Cognizant anticipates fourth-quarter revenue between $5.49 billion and $5.57 billion, with growth expectations of 3.0% to 4.5%. The company remains focused on leveraging its AI-driven strategies to sustain growth and deliver long-term value to its shareholders.
