Cognizant Technology Solutions Corporation (CTSH) Q1 2025 Earnings Call

Investor webinar replay

Replay transcript excerpt

year-over-year in constant currency driven by growth among life sciences and financial services clients including UK public sector which help drive strong constant currency sequential growth of about 4% in the UK. We are encouraged by our momentum in Europe which has been driven by new logos and a more focused sales strategy. The rest of the world increased about 7% year-over-year in constant currency. Growth was driven by recent large deals, particularly within comms, media and technology, and financial services. Turning to bookings. First quarter bookings declined 7% year-over-year, driven by a decline in rest of the world region, which had $200 million plus deals in the prior year period. The mix of new and expansion bookings grew significantly year-over-year and represented more than 50% of our quarterly bookings. On a trailing 12-month basis, bookings grew 3% year-over-year to 26.7 billion and represented a 1.3x book-to-bill. Our pipeline continues to grow particularly for large deals, and we have seen healthy demand in applications, AI, and cybersecurity. Turning to margins. During the quarter, we sold an office complex in India for proceeds of 70 million and recorded a gain on transaction of 62 million. Excluding the positive impact of this transaction, adjusted operating margin was 15.5%. Year over year, margin improved by 40 basis points, primarily reflecting the net savings generated from our NextGen program and the benefit from the depreciation of the Indian rupee. This was partially offset by increased compensation cost. Utilization also increased to approximately 85% driven by operational discipline. Now moving to cash flow and capital allocation. PSO of 81 days increased by three days from both the end of 2024 and the year-ago quarter, driven by busines...