* Sees FY earnings at least $3.38/share vs est $3.37
* Second-quarter earnings $0.82/share vs est $0.80
* Second-quarter revenue $1.8 bln vs est $1.79 bln
* Shares up 13 percent
(Adds comments from Cognizant President, analysts)
By Sruthi Ramakrishnan
Aug 6 (Reuters) - Cognizant Technology Solutions Corp
stood by its full-year revenue forecast at a time when
its Indian peers have been painting a gloomy picture for the
rest of the year on slowing global outsourcing spending.
The company's shares rose as much as 13 percent to $65.48 on
Monday on the Nasdaq.
Teaneck, New Jersey-based Cognizant, most of whose employees
are in India, has been gaining ground over Infosys Ltd
and Wipro Ltd as it has traditionally worked
with relatively lower margins, helping it win more contracts.
"Cognizant reiterating its guidance of at least 20 percent
growth in this environment shows that it's in a different league
compared to the likes of Infosys and Wipro," Morningstar analyst
Swami Shanmugasundaram said.
Its quarterly revenue topped Infosys' for the first time, as
the bellwether of India's showpiece $100 billion outsourcing
sector faces diminishing hopes of a revival in demand.
Cognizant added six new strategic customers in the quarter,
including Philips Electronics NV, its president, Gordon
Coburn, told Reuters.
The company defines strategic customers as those who have
the potential to bring in at least $5 million to more than $50
million a year in annual revenue.
Cognizant is seeing an upward shift in pipeline as clients
look for ways to run their business more efficiently and a shift
to larger end-to-end outsourcing deals from discretionary
projects, Coburn said on a conference call.
The company entered into a $330 million deal in June with
the U.S. unit of Dutch insurer ING Groep NV to expand
the business process management contract between the two.
"The majority of our growth for the remainder of 2012 will
come from the ramp-up of clients that we won over the past
months and years, including recent transformational engagements
such as ING US, Philips and others," Chief Financial Officer
Karen McLoughlin said on a conference call.
The company, which also competes with Accenture Plc
and Computer Sciences Corp, said growth returned to some
of its largest banking clients in the quarter. It counts
JPMorgan Chase & Co, Rabobank and UBS AG
among its core banking clients.
RAISED FULL-YEAR PROFIT OUTLOOK
Cognizant raised its profit forecast but reiterated its
revenue outlook for the year.
Coburn said the raised profit outlook is mainly a result of
its share repurchase plan in the second quarter.
Cognizant expects earnings for the year to be at least $3.38
per share, up from its previous forecast of at least $3.36 per
share. It reaffirmed its revenue forecast of at least $7.34
"On a constant-dollar basis since we last gave outlook, we
actually took our outlook up by over $20 million. We've absorbed
over $20 million of negative currency impact for the full year,"
Analysts on average were expecting full-year earnings of
$3.37 per share on revenue of $7.34 billion, according to
Thomson Reuters I/B/E/S.
Cognizant expects its adjusted operating margin to remain in
the range of 19 percent to 20 percent for the rest of the year.
Operating margins rose to 20 percent for the June quarter from
19.8 percent a year earlier.
The company, which was founded in 1994 as a captive unit of
Dun & Bradstreet in India, said net income rose to
$251.9 million, or 82 cents per share, for the second quarter
from $208 million, or 67 cents per share, a year earlier.
Excluding today's gains, Cognizant's shares have fallen
about 20 percent since May 7 when the company lowered its
full-year forecast for the first time in nearly four years.
(Reporting by Sruthi Ramakrishnan in Bangalore; Editing by Don
Sebastian, Saumyadeb Chakrabarty)