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Thursday 9 February 2012

Cognizant Technology - The Journey Ahead

10th Feb 2012

In the world's biggest outsourcing market US, Cognizant Technology Solutions is now only $50 million behind Tata Consultancy Services, according to the October-December quarter revenues earned by these companies.

TCS, which counts General Electric and Citibank among its top US customers, earned $1.37 billion during the quarter ending December from the country, compared to Cognizant's $1.32 billion.

From a gap of around $150 million in quarterly revenues from North America in March 2010, Cognizant is now looking set to become the biggest India-based outsourcing firm in the region.

On its part, TCS has a much more diversified client base when compared with Cognizant. For instance, while Cognizant gets almost 80% of its revenues from the US, TCS's North American business contributes 53% of the total revenues. TCS has UK and Continental Europe customers contributing a quarter of its total revenues.

Cognizant, which counts JP Morgan, Merck and 3M among its top US customers, grew its revenues from the country sequentially by 6.1% and 31.2% compared to the December quarter of 2010.

TCS reported a 2.2% sequential growth in its America revenues and 20.2% compared to the same period last year.

Analysts tracking the sector said Cognizant is expected to narrow its gap with larger peers by growing its share of spend from top healthcare customers-a segment where others are not as strong.

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