Cognizant Technology Solutions Corp has raised its revenue growth guidance from 4-7 per cent to 5.6-7.6 per cent in constant currency, it had earlier guided that the business is picking up, especially in the digital transformation space. The revenue for the second quarter is expected to grow 8-9 per cent in constant currency in the range of $4.42 billion-$4.46 billion.

The Teaneck, New Jersey-based firm posted revenues of $4.4 billion, up 2.4 per cent annually in constant currency, for the first quarter ended March, driven by digital revenues that grew 15 per cent year-on-year. The digital business now contributed 44 per cent to the company’s total revenue in the March qua, up from 39 per  cent in the same quarter of the previous year. The company follows the calendar year.

Cognizant deployed $700 million on acquisitions, share repurchases, and dividends in Q1. It announced four acquisitions in the March quarter such as Linium, Servian, Magenic, and ESG Mobility, targeted at strengthening its focus areas in cloud, data, digital engineering, and internet of things (IoT).

“In the first quarter, we successfully executed our strategy of embracing digital, investing in international expansion, and repositioning the Cognizant brand. Cloud migration and digital adoption will create a significant opportunity for Cognizant in the coming years,” said Brian Humphries, chief executive officer, Cognizant.

Revenue from financial services (33.1 per cent of revenues) declined 1.7 per cent in constant currency, as revenue growth generated by digital services in both banking and insurance was offset by declining non-digital revenue as clients continued to optimize the cost of supporting their legacy systems and operations.

Healthcare (29.3 per cent of revenues) revenue grew 7 per cent in constant currency as it benefited from increased demand for its integrated payer software solutions and continued strong demand among life science clients.

Revenue from products and resources (22.7 per cent of revenues) increased 2.4 per cent  in constant currency. Revenue among manufacturing, logistics, energy and utilities clients grew double-digits for the fourth consecutive quarter while retail, consumer goods, travel and hospitality clients continued to be adversely affected by the covid-19 pandemic.