Cognizant Technology Solutions (CTSH) Q2 2023 Earnings Call Transcript

For the period ending June 30, 2023

August 2, 2023 5:00 p.m. ET

Prepared Remarks

Questions and Answers

Call Participants

Prepared Remarks:

Operator

Greetings, and welcome to the Cognizant Second Quarter 2023 Earnings Conference Call. [Operator Instructions] As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Tyler Scott, the Vice President of Investor Relations. Please go ahead.

Tyler Scott

Thank you, operator, and good afternoon, everyone. By now you should have received a copy of the earnings release and the investor supplement for the company's second quarter 2023 results. If you have not, copies are available on our website, cognizant.com. The speakers we have on today's call are Ravi Kumar, Chief Executive Officer; and Jan Siegmund, Chief Financial Officer.

Before we begin, I would like to remind you that some of the comments made on today's call and some of the responses to your questions may contain forward-looking statements. These statements are subject to the risks and uncertainties as described in the company's earnings release and other filings with the SEC.

Additionally, during our call today, we will reference certain non-GAAP financial measures that we believe provide useful information for our investors. Reconciliations of non-GAAP financial measures where appropriate to the corresponding GAAP measures can be found in the company's earnings release and other filings with the SEC.

With that, I'd like to turn the call over to Ravi. Please go ahead.

Ravi Kumar

Thank you, Tyler. Good afternoon, everyone. I would like to discuss four topics with you today. Our second quarter results, the demand environment of comprehensive commitment to generative AI and an update on our long-term priorities.

We made continued progress during the quarter in what remains an uncertain global macroeconomic environment. Q2 came in at $4.9 billion at the high end of our guidance range. We were pleased to return to sequential revenue growth of more than 1%. Year-over-year Q2 revenue showed a modest decline of 40 basis points or essentially flat in constant currency. Our adjusted operating margin was 14.2% and adjusted EPS was $1.10.

We recorded another quarter of strong bookings growth 17% year-over-year ending quarter two with record trailing 12-months bookings of $26.4 billion. A book-to-bill of 1.4x approximately 30% of our in quarter Q2 bookings were large deals and five of this deals exceeded $100 million each. Our bookings continue to be a balance mix of renewables, extensions and new opportunities. The leadership team and I remain intensely focused on a talent. So I am glad to see the continued reduction in our iteration with trailing 12-months voluntary attrition for our tech services business declining to 19.9% down 3 percentage points sequentially and 11 percentage points year-over-year.