Cognizant forecasts slow growth

IT services provider Cognizant Technology Solutions Corp forecast its slowest revenue growth in 14 years for the current quarter, as clients worldwide rein in IT spending.

Shares of the company, which also reported its first revenue miss in six quarters, fell 8.1 percent to $53.80 in premarket trading on Monday.

New Jersey-based Cognizant said it expects adjusted profit of between 78-80 cents per share and revenue of $3.18 billion-$3.24 billion for the three months ending March.

The top end of the revenue range indicates an 11.34 percent growth in the current quarter from a year earlier, its slowest since the March quarter of 2002.

Analysts on average were expecting a profit of 81 cents per share and revenue of $3.32 billion for the first quarter, according to agencies.

IT services companies have been focusing on high-margin digital technology and automation outsourcing contracts at a time when clients are cutting back on routine IT services spending.