Cognizant Technology Solutions Corp, one of India's top IT companies, reported a modestly better-than-expected quarterly profit as clients in Europe ramped up outsourcing, but guided first-quarter profit below analysts' estimates.
European companies have been outsourcing more in recent months as instability in the region forces them to restructure and cut costs. However, some U.S. companies have said they may be seeing a bottom after years of weakness in the region.
The economic downturn in Europe has served as a catalyst for longer-term growth for outsourcing in the region, Cognizant President Gordon Coburn said after the company reported third-quarter results in November.
Rivals Tata Consultancy Services Ltd and Infosys Ltd , India's top two software services providers, reported better-than-expected results earlier this month boosted by client additions and accelerated IT spending by existing customers.
While 13 new deals in Europe boosted Infosys' revenue in the quarter ended December 31, TCS termed Continental Europe a "soft point" as revenue from the region dropped sequentially.