Cognizant to Report Q2 Earnings: What's in Store for the Stock?

Cognizant Technology Solutions CTSH is scheduled to report its second-quarter 2025 results on July 30.

The Zacks Consensus Estimate for second-quarter 2025 earnings is pegged at $1.26 per share, which has remained unchanged in the past 30 days. This represents a 7.69% increase from the figure reported in the year-ago quarter. 

Cognizant expects second-quarter 2025 revenues between $5.14 billion and $5.21 billion, indicating growth of 5.9%-7.4% and an increase of 5%-6.5% on a cc basis. 

The Zacks Consensus Estimate for second-quarter revenues is pegged at $5.19 billion, indicating a year-over-year increase of 7.06%.

Cognizant Technology Solutions Corporation Price and EPS Surprise

Cognizant Technology Solutions Corporation price-eps-surprise | Cognizant Technology Solutions Corporation Quote

Cognizant’s earnings surpassed the Zacks Consensus Estimate in all the trailing four quarters, the average surprise being 6.38%. 

Let’s see how things have shaped up for the upcoming announcement.

Factors to Note

Cognizant’s second-quarter 2025 performance is likely to have benefited from an expanding clientele and a robust pipeline that includes a favorable mix of new opportunities. In the first quarter of 2025, the company secured several contracts, including a mega deal valued at more than $500 million. This is likely to have contributed to the to-be-reported quarter’s performance as well.

Cognizant’s investment in artificial intelligence (AI), including platforms like Neuro IT Ops and Flowsource, is expected to have driven growth in the to-be-reported quarter as more clients adopt AI-driven automation, enhance operations, and improve productivity.

The growing demand for GenAI solutions across industries like financial services, healthcare, and manufacturing is expected to provide continued growth opportunities, particularly in areas like fraud detection, medical imaging, and predictive maintenance.

CTSH’s NextGen initiative is expected to have played a pivotal role in enhancing operational efficiency in the to-be-reported quarter.

Despite Cognizant’s expanding clientele, macroeconomic challenges and ongoing cost optimization pressures across some sectors are expected to hurt the company’s top-line growth in the to-be-reported quarter. A broader market weakness in the tech sector and persistent fear over mounting tariffs by the U.S. government have added to the pressure.

Cognizant Benefits From Expanding Clientele

Cognizant’s robust network of partners, which includes SmartestEnergy, Kramp, Pegasystems PEGA, Alphabet’s GOOGL cloud business Google Cloud, Omron OMRNY, Docusign, ServiceNow, NVIDIA, Boehringer Ingelheim, CrowdStrike, Zscaler, IBM, Palo Alto Networks, and Amazon, is likely to have driven growth during the second quarter.

In May 2025, Cognizant also announced an expanded collaboration with Pegasystems to enhance its agentic AI services using Pega Blueprint, enabling rapid cloud transformation and AI-powered modernization for enterprise clients. Benefits from this partnership are likely to have been reflected in the to-be-reported quarter’s performance.

In June 2025, Cognizant, in collaboration with Alphabet’s cloud platform Google Cloud, launched Cognizant Autonomous Customer Engagement, which is an AI-driven contact center solution powered by Alphabet’s Google Cloud to deliver hyper-personalized, omnichannel customer experiences with enhanced efficiency and scalability.

In April 2025, CTSH partnered with OMRON to integrate Information Technology (IT) and Operational Technology in manufacturing, combining OMRON’s automation products with Cognizant’s IT expertise to enable digital transformation and operational excellence.

Conclusion

Cognizant’s expanding clientele and robust AI-driven solutions are expected to contribute to its growth prospects and drive top-line growth in the to-be-reported quarter. 

Cognizant currently has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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