14 slides from Cognizant Technology Solutions's earnings presentation, Feb 8, 2017
Slide 1: Accelerating the Shift to Digital
Investor Presentation Accelerating the Shift to Digital February 8, 2017 © 2017 Cognizant © 2017 Cognizant
Slide 2: Forward Looking Statements and Non-GAAP Financial Measures
Forward Looking Statements and Non-GAAP Financial Measures This investor presentation includes statements which may constitute forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, including, but not limited to, express or imp
Slide 3: Cognizant company overview
Founded 260,200 in 1994 Employees (CTSH, Nasdaq) Headquarters 100+ Global Teaneck, NJ Delivery Centers Cognizant (NASDAQ-100: CTSH) is one of the world’s leading professional services companies, transforming clients’ business, operating and Revenue Mix Revenue technology models for the digital era.
Slide 4: Digital Leader at Scale
Digital Leader at Scale Digital Revenue ~23% of total in 2016 • Deep domain expertise across key industry verticals Other • Integrated enterprise solutions 12% based on knowledge of core Financial systems & processes Manufacturing / Services Retail / Logistics 20% 40% • Comprehensive digital offerin
Slide 5: Clients shifting to digital while optimizing core systems and operations
Clients shifting to digital while optimizing core systems and operations Client Trends Cognizant Response • …investing in three integrated digital • Shifting client needs to digital practice areas across our business transformation segments to stay at the forefront of industry and customer expectati
Slide 6: Comprehensive services suite to help clients create digital enterprises
Comprehensive services suite to help clients create digital enterprises Digital Business • Delivering insight, digital strategy and implementation The New Customer • Investing in capabilities (e.g., design, analytics, data science) to scale Experience across verticals and geographies Cognizant Busin
Slide 7: Accelerating the shift to digital drives change in our operating model
Accelerating the shift to digital drives change in our operating model Drive sustainable growth Continue • Invest to scale up our three digital practice areas across our business segments and geos industry • Pursue M&A to enhance portfolio and accelerate organic growth profile leadership • Drive bus
Slide 8: Continue successful track record of inorganic investments to enhance new capabilities
Continue successful track record of inorganic investments to enhance new capabilities and accelerate transition to digital Digital solutions Customer experience Energy consulting & Marketing & IoT services & Healthcare platform (Australia) & design consulting services (Europe) customer experience so
Slide 9: Enhancing margin to enable continued investment in the business
Enhancing margin to enable continued investment in the business • Completed review of our business and operations with input from top-tier consulting firm • Identified and are executing against operational improvements • Changing mix to higher margin business areas • Using scale to drive sustainable
Slide 10: Target 22% Non-GAAP operating margin in 2019 by balancing three areas
Target 22% Non-GAAP operating margin in 2019 by balancing three areas 360 to 440 bps impact • Strategic tuck-in M&A • Mix shift to digital • Mix shifts to higher value services • Investments in transformational deals (e.g., BPaaS) • Selective pursuit of business opportunities Target 22% non- • Inves
Slide 11: Margin enhancement over three years
Margin enhancement over three years 2017 + 2018 + 2019 • Investments made in • Full benefit of cost • 22% Non-GAAP 2016 will impact actions taken in 2017 operating margin target margins in early 2017 • Benefit from permanent • Benefit from business • Benefits of cost actions efficiencies built into
Slide 12: Capital return plan: $3.4B over two years (2017-2018)
Capital return plan: $3.4B over two years (2017-2018) Return 75% U.S. free cash flow starting in 2019 Accelerated Share + Repurchases + Dividends 2017-2018 Capital Return Repurchase (ASR) • $1.5B ASR in 2017 • $1.2B open market • $0.15 / share ASR ~$1.5B share repurchases quarterly dividend • Plan t
Slide 13: Best-in-class corporate governance
Best-in-class corporate governance • Continuous improvement in corporate governance based on best-in-class industry standards • Respond to shareholder input and concerns • Continue to ensure executive compensation plan aligns with strategic objectives • Ongoing board refreshment • Two new independen
Slide 14: Thank You
Thank You 13 © © 2017 2017 Cognizant Cognizant