Cognizant withdraws 2020 guidance due to COVID-19 outbreak
With the outbreak of COVID-19 and uncertainty in the business, Cognizant has withdrawn its 2020 guidance which was announced in February.
According to the company, due to the pandemic there are delays in project fulfilment as delivery, particularly in India and the Philippines has mainly shifted to work-from-home mode.
Cognizant is also observing a reduced client demand mainly in industries like travel and hospitality. Entering the second quarter, Cognizant expects the pandemic to further reduce client demand as its societal and economic impact causes broader disruptions across industries, the company said.
"The long-term fundamentals of our business remain strong. However, given the unprecedented nature of this crisis, uncertainty around its duration and its impact on our ability to forecast performance, the company is withdrawing its 2020 guidance that was provided on February 5, 2020." Cognizant said in a statement.
Karen McLoughlin, Chief Financial Officer said, "We are confident that the combination of our strong balance sheet, and our robust operating and cash generative business model, will enable us to weather this disruption."
The company said that first-quarter revenue is expected to be $4.22-$4.23 billion, up 2.7-2.9% (3.4-3.6% in constant currency) from the prior-year quarter, including a negative 50 basis point impact from the exit of certain content services.
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