Software services giant Cognizant Technologies aims to sell its office assets in Bengaluru and Hyderabad as part of its plan to become asset-light and capitalise on non-core real estate, according to a media report.
The company intends to divest its 10-acre campus in Gachibowli, Hyderabad, as well as a 14-acre campus in Siruseri, Chennai, in line with its cost-cutting restructuring plan to save $400 million over two years, including vacating 11 million square feet of office space, The Economic Times reported.
“Cognizant is re-evaluating its entire real estate portfolio and has given up rented properties in some geographies,” the report quoted multiple people, who are aware of the transaction, as saying.
The company, in some cases, has renegotiated the rent and downsized the assets too, the people said further.
Cognizant helps companies modernise technology, reimagine processes and transform experiences. The company reported a 16 per cent drop in net profit to $525 million for the third quarter ended September 30, 2023 as against $629 million for the same period last year. Revenue was almost flat at $4.89 billion.
“We strengthened the company’s fundamentals during the third quarter as reflected in higher customer satisfaction scores, significantly lower voluntary attrition, and continued growth in bookings, despite ongoing economic uncertainty,” said Ravi Kumar S, chief executive officer of Cognizant.
“We are investing to put Cognizant in the best position to serve clients as they strive to reduce costs, digitally transform their businesses and embrace generative AI,” he added.
The total headcount at the end of the third quarter was 3,46,600, an increase of 1,000 from Q2,2023 and a decrease of 2,800 from Q3, 2022.
“We have narrowed our full-year revenue guidance range, which now reflects recent discretionary spending pressure and its impact to our near-term revenue expectations. We have also updated our adjusted operating margin guidance to approximately 14.7%, which is the high-end of our prior range, reflecting our continuing focus on enhancing operational discipline,” said Jan Siegmund, Chief Financial Officer at Cognizant. Business Today