- Infosys reported a 3.8% increase in quarterly revenue, reaching $4.894 billion in the September quarter, surpassing Cognizant.
- Cognizant has faced three CEO changes in the past seven years, affecting its growth rate, which stands at 0.91% compounded quarterly.
Infosys Ltd has retaken its position as India’s second-largest IT services company, overtaking Cognizant after 14 years. In the September quarter, Infosys reported a 3.8% increase in revenue, reaching $4.894 billion. In contrast, Cognizant’s projected revenue for the same period stands between $4.89 billion and $4.94 billion.
This change signifies a major shift for Infosys under the leadership of Chairman Nandan Nilekani and CEO Salil Parekh, while underscoring the growth hurdles Cognizant has faced, including three CEO changes in the last seven years.
Cognizant, headquartered in New Jersey, will announce its September-quarter financial results on 30 October. The company, which employs three-fourths of its workforce in India, had previously surpassed Infosys in the April-June 2012 quarter. However, Infosys has now edged past its competitor, reinforcing its transformation strategy.
A senior IT industry executive commented:
“This outsized growth (at Infosys) demonstrates a variety of things. First, it reinforces confidence among customers that a company is attracting the right talent and delivering superior solutions. Second, it reaffirms confidence among employees as superior growth implies faster career progressions. Finally, it’s a marker to investors and industry analysts and is a guidepost to future share price.”
Infosys’s resurgence is backed by its compounded quarterly growth rate of 2.12% over 27 quarters, despite a 320 basis point decline in profitability. Conversely, Cognizant has managed only a 0.91% quarterly growth rate over 26 quarters, with its operating margin falling by 260 basis points.
As TCS remains the largest IT firm in India, Infosys's growth trajectory puts it firmly back in the spotlight.
Edited by Harshajit Sarmah
