CTSH US S&P 500Russell 1000 Earnings call
Cognizant (CTSH) · Q2 2026 results and valuation
Share price: $64.43 · 2026-11-11
Results Q2 2026 vs Q1 2026 · previous quarter · published 29 Jul 2026 and 29 Apr 2026
Net income down 3.9% on the previous quarter. Management sounded cautious, in its script and in answers to analysts.
Only a basic analysis is available for this company at the moment.
1 · Numbers
−3.9%
Net income vs Q1 2026
Outlook given
Net income 636.0M vs 662.0M
Revenue +1.3%
2 · How management spoke
Cautious
Among the least upbeat of all company calls
Answers to analysts: upbeat, in line with the script.
Similar to last call.
3 · What stood out
Guidance
Cognizant expects its India defined benefit plan to cost about $10 million per quarter for the foreseeable future, confirming that steady expense…
Valuation
Is Cognizant undervalued?
Reverse DCF. Free cash flow from the last full fiscal year (2025-12-31), grown for 10 years, discounted back, plus a terminal value. “Implied growth” is the rate the current price assumes.
At 2.8% growth a year (3-year revenue growth), the model's fair value is $78.43 a share — the stock trades 18% below it. Today's price assumes 0.0% growth a year.
Current price
$64.43
close of 2026-11-11
Market implies growth of iThe yearly free-cash-flow growth, for the next 10 years, that today’s share price already assumes. If you believe the company grows faster than this, the stock is cheap under this model; slower, and it is expensive.
+0.0% for 10 yrs
Fair value / share
$78.43
Buy below
$58.82
Price vs fair value
Undervalued 18%
Price vs buy-below price
Overvalued 10%
Management expects
Revenue +4.55% · from the Q2 2026 report: “Cognizant expects third-quarter revenue to grow 3.8% to 5.3% year-over-year in constant currency, giving investors a clear near-term growth target.”
A guidance figure for revenue, usually one year ahead, not a 10-year free-cash-flow rate.
Read between the lines
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Key theme
CTSH's strategy of doing old things in new ways helped it win more than half of deals, creating large deal momentum that is starting to become large deals.
Source quote
“Now we have progressively gone into newer things, which is my second and third swim lane, which is doing old... We have we have done pretty well in winning more than half of the deals, and that has led to a large deal momentum over the last two years. All those are starting to become large deals.”
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Guidance
Cognizant expects third-quarter revenue to grow 3.8% to 5.3% year-over-year in constant currency, giving investors a clear near-term growth target.
Source quote
“For the third quarter, we expect revenue to grow 3.8% to 5.3% year-over-year in constant currency.”
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Figure
CTSH highlighted that its healthcare platform generates more than $1.1 billion in annual revenue, underscoring the segment's significant scale as a revenue driver.
Source quote
“Our healthcare platform business generates more than $1.1 billion in annual revenue.”
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Fading
Free cash flow was about $200 million while the company returned $600 million to shareholders, and the collection period rose three days to 84, indicating slower cash collection.
Source quote
“First quarter free cash flow was approximately $200 million, impacted by a larger bonus payout this year and in line... DSO of 84 days increased 3 days sequentially and year-over-year. During the quarter, we returned about $600 million of capital to shareholders through share repurchases and dividends.”
Tone
How upbeat the language was, compared with other companiesiTone counts positive minus negative finance words, adjusted for length. Executives mostly speak positively, so the labels compare each call with every company's latest call: “typical” is the middle third, “very upbeat” the top tenth, “cautious” the bottom tenth.. Dot: Q2 2026. Ring: Q1 2026.
Script and answers carried a similar tone, so the script's message held up under questioning.
Sentences that drove the tone
“We delivered a solid second quarter with organic revenue growth at the high end of our expectations and year-over-year adjusted operating margin expansion.”
“And, you know, as I talked, we are seeing accelerated momentum on new things in new ways using AI, which is primarily driving growth imperatives for enterprises.”
“As we expanded adjusted operating margins year-over-year for the sixth straight quarter demonstrating continued profitable revenue growth.”
Full figures
USD · ROIC.AI fundamentals (NASDAQ:CTSH, period end 2026-06-30)
| Metric | Q2 2026period end 2026-06-30 | Q1 2026period end 2026-03-31 | Change | Q2 2025 | YoY |
|---|---|---|---|---|---|
| Revenue | 5.48B | 5.41B | +1.3% | 5.25B | +4.5% |
| Gross profit | 1.83B | — | — | ||
| Operating income | 958.0M | 843.0M | +13.6% | 817.0M | +17.3% |
| Net income | 636.0M | 662.0M | −3.9% | 645.0M | −1.4% |
| EPS | 1.36 | 1.39 | −1.8% | 1.31 | +4.2% |
| P/E today 12.6 | — | 13.3 | — | 15.8 | — |
Topics
Most discussed now
- As Cognizant expanded adjusted operating margins year-over-year for the sixth straight quarter demonstrating continued profitable revenue…
- As Cognizant begins to unlock entirely new business categories and client value pools.
- Financial services grew nearly 12% year-over-year in constant currency, the second consecutive quarter of 10%-plus growth.
- Cognizant is also seeing strong growth from industry-specific AI-led transformation in financial services, and life sciences.
- Year over year performance was driven by volume growth, increase in third-party product revenue associated with Cognizant's integrated…
Faded since Q1 2026
- Fading Cognizant is reforging its first principles, enabling an AI Era future operating model, equipping its go-to-market teams across the 3...
- Fading For fixed price programs, Cognizant has the opportunity to reduce the cost and keep the margin with it.
- Dropped As Cognizant has continued to hire the fresh college radiates into the mix.
- Fading Cognizant continues to drive profitable growth as adjusted operating margin expanded year-over-year for the fifth straight quarter.
Latest announcements
Official filings, newest first.
- Material agreement; New financial obligation · SEC 8-K
- Results of operations; Regulation FD disclosure · SEC 8-K
- Regulation FD disclosure · SEC 8-K
- Shareholder vote results · SEC 8-K
- New financial obligation · SEC 8-K
- Regulation FD disclosure · SEC 8-K
- Results of operations; Regulation FD disclosure · SEC 8-K
- Director or officer change · SEC 8-K