Cognizant reported third-quarter 2026 revenue of $5.66 billion, up 4.6% from a year earlier, with double-digit growth in Financial Services and higher adjusted earnings per share. The technology services company also updated its full-year revenue, margin and earnings outlook.
The results showed a split in profitability measures: adjusted operating margin widened, while GAAP operating margin narrowed. Cognizant said it has extended its run of year-over-year adjusted margin expansion to seven consecutive quarters.
Key details
- Revenue growth was 4.8% in constant currency. Reported revenue rose to $5.664 billion from $5.415 billion a year earlier, when growth was 7.4%.
- Financial Services revenue increased 12% year over year. Cognizant described this as another quarter of double-digit growth in the segment.
- Adjusted operating margin rose to 16.3%, up 30 basis points. GAAP operating margin was 15.4%, down 60 basis points from 16.0% a year earlier.
- Adjusted diluted EPS increased 7.2% to $1.49. GAAP diluted EPS was $1.39, compared with $0.56 a year earlier.
- Trailing 12-month bookings reached $28.7 billion, up 4%.
- Full-year 2026 revenue guidance is now 4.0% to 4.4% growth in constant currency. The company described this as revised guidance but did not state in the provided announcement how it compares with its previous range.
- Cognizant expects full-year adjusted operating margin of about 16.1%, representing a 30-basis-point increase year over year.
- Full-year adjusted diluted EPS guidance is $5.72 to $5.79, equivalent to year-over-year growth of 8% to 10%.
- Year-to-date cash flow was lower than a year ago. For the first nine months of 2026, operating cash flow was $1.836 billion, versus $2.025 billion in the same period of 2025. Free cash flow was $1.582 billion, compared with $1.884 billion.
- Cognizant highlighted its internal use of AI. CEO Ravi Kumar said more than half of the company’s code is now AI-assisted and employees have earned more than 95,000 advanced AI badges and certifications. He framed the effort as part of the company’s strategy to help clients put AI to work across their businesses.
What stands out
Adjusted margin growth alongside a decline in GAAP margin means the two measures tell different stories about quarterly profitability. Cognizant’s updated full-year outlook calls for continued revenue growth and adjusted margin expansion, while its year-to-date cash generation remained below the prior-year level.