Executive Summary
Cognizant Technology Solutions Corp (Nasdaq: CTSH) reported a robust turnaround in calendar year 2025, posting a 6.95 % dollar‑adjusted revenue increase to US $21.12 billion—the highest growth since 2021. In its Q4 2025 earnings call on February 4, 2026, the company confirmed a strong outlook for fiscal 2026, projecting full‑year revenue of US $22.14 billion to US $22.66 billion and adjusted earnings per share (EPS) of $5.56 – $5.70, representing a 5 % to 8 % rise over the prior year.
The company will return US $1.6 billion to shareholders through a combination of share repurchases (US $1.0 billion) and dividends in 2026. Cognizant also announced plans to hire 24,000 to 25,000 fresh graduates in 2026, a 20 % increase over 2025, to support productivity gains driven by artificial‑intelligence‑enabled delivery models.
Revenue and Earnings Performance
| Metric | 2025 | 2026 Guidance |
|---|---|---|
| Revenue | US $21.12 billion (6.95 % growth) | US $22.14 billion – $22.66 billion |
| Adjusted EPS | – | US $5.56 – $5.70 (5 %–8 % YoY) |
| Shareholder Return | – | US $1.6 billion (US $1.0 billion share buybacks + dividends) |
The revenue growth rate and earnings guidance demonstrate a clear improvement from the 2023 decline, positioning Cognizant among the top performers in the Indian‑heritage IT services sector.
AI Strategy and Workforce Planning
- AI Economic Council Support: CEO Ravi Kumar S endorsed India’s proposal to establish an AI Economic Council, describing it as a “brilliant idea” that would help manage the impact of AI on employment and regulate the adoption pace.
- Hiring Expansion: Cognizant plans to recruit 24,000 to 25,000 fresh graduates in 2026, up 20 % from 2025, to capitalize on AI‑driven productivity at the entry level.
- Market Sentiment on AI: In the wake of a sharp sell‑off that erased nearly Rs 2 lakh crore in market value from IT stocks, Cognizant issued a reality check on Anthropic AI, indicating that AI developments would not materially alter its valuation trajectory.
Share Performance and Market Context
- Stock Price: As of 2026‑02‑02, the closing price was US $74.50, within the 52‑week range of US $65.15 to US $90.82.
- Market Capitalisation: Approximately US $36.4 billion.
- Price‑to‑Earnings Ratio: 14.52, reflecting market expectations of steady earnings growth.
Recent institutional activity includes TD Waterhouse Canada and Zurcher Kantonalbank executing sizable share transactions, underscoring active interest from foreign investors.
Outlook and Strategic Focus
Cognizant’s FY26 guidance underscores continued investment in AI‑enabled service delivery, workforce expansion, and shareholder returns. The company’s reaffirmed confidence in its revenue and earnings trajectory, coupled with a proactive stance on AI policy and workforce development, positions it to sustain its turnaround momentum and enhance value for shareholders in the near term.
