Healthcare business helps Cognizant beat revenue estimates
(Adds analyst estimates, forecast, details, share background)
May 4 (Reuters) - IT service provider Cognizant Technology Solutions Corp reported a better-than-expected 20 percent jump in quarterly revenue, helped by higher spending by healthcare and financial service clients in North America.
The company also raised its revenue and profit forecasts for the full year.
Revenue in the healthcare business, which accounts for nearly a third of Cognizant's total revenue, soared about 43 percent to $879.1 million in the first quarter ended March 31.
Growth in the business picked up in the fourth quarter, helping assuage concerns about spending by clients such as insurers, hospitals and state-run exchanges set up under the U.S. Affordable Care Act, or Obamacare.
Revenue from financial services, comprising about 40 percent of total revenue, increased 13.4 percent to $1.16 billion.
Like its Indian rivals Tata Consultancy Services, and Infosys Ltd, Cognizant gets the largest chunk of its revenue from financial services clients.
Tata Consultancy, India's largest software services exporter, last month posted a better-than-expected rise in net profit, led by strong worldwide client spending, and issued an upbeat forecast.
Cognizant's revenue rose to $2.91 billion from $2.42 billion a year earlier.
Net profit increased to $382.9 million, or 62 cents per share, from $348.9 million, or 57 cents per share.
On an adjusted basis, the company earned 71 cents per share.
Analysts on average expected a profit of 70 cents per share on revenue of $2.89 billion, according to Thomson Reuters I/B/E/S.
Cognizant said it now expects adjusted profit per share for the year to be at least $2.93, up from the $2.91 it previously forecast. The company also raised its revenue forecast to at least $12.24 billion from $12.21 billion.
Analysts were expecting a profit of $2.95 per share on revenue of $12.29 billion.
Cognizant shares gained 12.3 percent this year through Friday's close.
(Reporting By Lehar Maan in Bengaluru; Editing by Joyjeet Das)
