Cognizant Technology Solutions Corporation · NASDAQ:CTSH
Cognizant Technology Solutions — Q3 2021 Earnings Presentation
18 slides from Cognizant Technology Solutions's earnings presentation, Oct 27, 2021
Slide 1: Third Quarter 2021 Financial Results and Highlights
Exhibit 99.3 Third Quarter 2021 Financial Results and Highlights October 27, 2021
Slide 2: Forward-Looking Statements
Forward-Looking Statements This earnings supplement includes statements that may constitute forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, the accuracy of which are necessarily subject to risks, uncertainties, and assum
Slide 3: Results Summary: Q3 2021
Results Summary: Q3 2021 REVENUE OPERATING MARGIN 1 Up 11.8% Y/Y as reported and 11.0% Y/Y in constant currency 15.4% 15.9% 15.8% $4,744M 14.2% $4,243M Q3 2020 Q3 2021 Q3 2020 Q3 2021 Q3 2020 Q3 2021 GAAP Operating Margin Adjusted Operating Margin 1 DILUTED EARNINGS PER SHARE CASH FLOW $1.03 $1.06 $
Slide 4: Revenue, EPS and Operating Margin
Revenue, EPS and Operating Margin $ In Millions Except Per Share Amounts $4,744 $4,585 $4,401 $4,248 $4,284 $4,225 $4,243 $4,141 $4,184 $4,110 $4,000 $1.08 $1.07 $0.99 $1.06 $0.91 $0.94 $0.96 $0.97 $0.97 $0.82 $0.67 1 Q1 '19 Q2 '19 Q3 '19 Q4 '19 Q1 '20 Q2 '20 Q3 '20 Q4 '20 Q1 '21 Q2 '21 Q3 '21 Reven
Slide 5: Revenue Performance: Q3 2021
Revenue Performance: Q3 2021 Segments Geography $ IN MILLIONS $ IN MILLIONS REST OF WORLD COMMUNICATIONS, +22.0% Y/Y MEDIA & TECHNOLOGY +21.0% Y/Y CC +20.0% Y/Y +19.1% Y/Y CC EUROPE FINANCIAL SERVICES $344 $739 +16.9% Y/Y +5.1% Y/Y +13.7% Y/Y CC +4.3% Y/Y CC $1,544 $914 PRODUCTS & RESOURCES +19.4% Y
Slide 6: Financial Services
Financial Services Revenue Q3 2021 Geography $ IN MILLIONS $ IN MILLIONS $1,544 REST OF WORLD $1,492 $1,502 $1,473 $1,468 $1,469 +7.6% Y/Y $1,451 $1,458 $1,436 +6.6% Y/Y CC $1,396 $1,305 EUROPE $142 +7.6% Y/Y +5.0% Y/Y CC $327 Q1 '19 Q2 '19 Q3 '19 Q4 '19 Q1 '20 Q2 '20 Q3 '20 Q4 '201 Q1 '21 Q2 '21 Q3
Slide 7: Healthcare
Healthcare Revenue Q3 2021 Geography $ IN MILLIONS $ IN MILLIONS $1,354 REST OF WORLD $1,325 $1,270 $1,288 EUROPE $30 +42.9% Y/Y $1,221 $1,231 +42.6% Y/Y CC $1,194 +3.8% Y/Y $1,165 $1,175 $1,157 +2.4% Y/Y CC $1,134 $162 Q1 '19 Q2 '19 Q3 '19 Q4 '19 Q1 '20 Q2 '20 Q3 '20 Q4 '20 Q1 '21 Q2 '21 Q3 '21 $1,
Slide 8: Products & Resources
Products & Resources Revenue Q3 2021 Geography $ IN MILLIONS $ IN MILLIONS $1,107 $1,055 REST OF WORLD $998 29.4% Y/Y $966 $963 $954 27.6% Y/Y CC $948 $914 $927 $927 $867 $88 EUROPE 39.9% Y/Y $270 34.9% Y/Y CC Q1 '19 Q2 '19 Q3 '19 Q4 '19 Q1 '20 Q2 '20 Q3 '20 Q4 '20 Q1 '21 Q2 '21 Q3 '21 $749 Revenue
Slide 9: Communications, Media & Technology
Communications, Media & Technology Revenue Q3 2021 Geography $ IN MILLIONS $ IN MILLIONS $739 $703 REST OF WORLD +37.7% Y/Y $661 $657 +37.6% Y/Y CC $632 $626 $607 $615 $616 $595 $580 $84 EUROPE +20.2% Y/Y +16.1% Y/Y CC $155 Q1 '19 Q2 '19 Q3 '19 Q4 '19 Q1 '20 Q2 '20 Q3 '20 Q4 '20 Q1 '21 Q2 '21 Q3 '21
Slide 10: Employee Metrics
Employee Metrics Headcount and Annualized Attrition NUMBER OF EMPLOYEES IN THOUSANDS 37% 31% 23% 24% 21% 22% 24% 21% 19% 18% 19% 33% 29% 16% 19% 18% 16% 16% 18% 13% 11% 10% 285.8 288.2 289.9 292.5 291.7 281.2 283.1 289.5 296.5 301.2 318.4 Q1 '19 Q2 '19 Q3 '19 Q4 '19 Q1 '20 Q2 '20 Q3 '20 Q4 '20 Q1 '2
Slide 11: Cash Flow, Balance Sheet & Capital Allocation
Cash Flow, Balance Sheet & Capital Allocation Annual Quarterly Share Repurchases Acquisitions Dividends $ IN MILLIONS $248 $1,621 $2,247 $320 $1,477 $788 $240 $580 $1,123 $54 $310 $348 $617 $769 $129 $57 $453 $480 $500 $120 $118 $128 $127 $127 FY2019 FY2020 Trailing 12-Months Q3 '20 Q4 '20 Q1 '21 Q2
Slide 12: FY2021 Guidance
1 FY2021 Guidance FY2020 FY2021 Guidance Assumptions ~$18.5B Revenue $16.7B ~11.1% Y/Y or ~9.8% Y/Y CC 2 Assumes sequential decline in Q4 as a Adjusted Operating Margin 14.4% ~15.4% result of merit increases Reflects lower interest income Y/Y as a Interest Income $119M ~$30M result of less cash in I
Slide 13: APPENDIX: About Non-GAAP Financial Measures
APPENDIX: About Non-GAAP Financial Measures
Slide 14: About Non-GAAP Financial Measures
About Non-GAAP Financial Measures To supplement our financial results presented in accordance with GAAP, this earnings supplement includes references to the following measures defined by the Securities and Exchange Commission as non-GAAP financial measures: Adjusted Income From Operations, Adjusted
Slide 15: Reconciliations of Non-GAAP Financial Measures
Reconciliations of Non-GAAP Financial Measures (in millions, except per share amounts) Three Months Ended: Full Year Mar 31, Jun 30, Sep 30, Dec 31, Mar 31, Jun 30, Sep 30, Dec 31, Mar 31, Jun 30, Sep 30, Dec 31, Guidance Full 2019 2019 2019 2019 2020 2020 2020 2020 2021 2021 2021 2020 Year 2021 GAA
Slide 16: Reconciliations of Non-GAAP Financial Measures
Reconciliations of Non-GAAP Financial Measures Notes: (a) In the third quarter of 2021, the parties to the consolidated putative securities class action suit filed a settlement agreement that, subject to the approval of the United States District Court for the District of New Jersey, would resolve t
Slide 17: Reconciliations of Non-GAAP Financial Measures
Reconciliations of Non-GAAP Financial Measures (g) Presented below are the tax impacts of each of our non-GAAP adjustments to pre-tax income: 2019 2020 2021 FY Adjusted Effective Tax Rate Reconciliation Guidance Three months ended: Mar 31 Jun 30 Sep 30 Dec 31 Mar 31 Jun 30 Sep 30 Dec 31 Mar 31 Jun 3
Slide 18: Reconciliations of Non-GAAP Financial Measures
Reconciliations of Non-GAAP Financial Measures Reconciliation of free cash flow Three Months Ended Mar 31, Jun 30, Sep 30, Dec 31, Mar 31, Jun 30, Sep 30, Dec 31, Mar 31, Jun 30, Sep 30, (in millions) 2019 2019 2019 2019 2020 2020 2020 2020 2021 2021 2021 Net cash provided by operating activities $
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