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Cognizant To Downsize, Will Slash 10,000 To 12,000 Mid-To-Senior Level Jobs Worldwide To Optimise Cost Structure
Cognizant Technology Solutions India Pvt. Ltd. office in Chennai. (Madhu Kapparath/Mint via Getty Images)
IT major Cognizant Technology Solutions has announced that it will remove 10,000-12,000 mid-to-senior level associates worldwide in coming quarters in an attempt to optimise cost structure and fund its investment plans and growth agenda, the company's CEO Brian Humphries informed analysts while discussing the third quarter financial results.
Under the “2020 Fit for Growth”plan, the company hopes to streamline costs and regain its position as the bellweather of the industry. The plan is expected to be cost the company anywhere between $150 million and $200 million, primarily related to severance and exit costs. The plan also involves investment in technology, sales and marketing, reskilling, acquisitions, and strategic partnerships to sharpen strategic positioning in key digital areas.
Cognizant’s current workforce strength is 2.88 lakh global workforce with over 75 per cent of them are located in India.
The company also said that it net reduction will be approximately 5,000 to 7,000 roles (about 2 pet cent of the company’s total population), as it plans to rapidly re-skill and redeploy approximately 5,000 of the total associates impacted.
During the earnings call, the company leadership informed “Our work (in content moderation) is largely focused on determining whether certain content violates the client's standards and can involve objectionable materials. This is not in line with the strategic vision of the company.”
For the third quarter ended September, the company registered a revenue of $4.25 billion, up 4.2 percent for the same quarter previous year. Digital revenue growth was in the mid-20 per cent range and represented over 35 per cent of total revenue.
Number of employees as of September 30 was approximately 289,900 (up from approximately 288,200 as of June 30, 2019).
Full year 2019 year on year revenue growth in the range of 4.6-4.9 per cent in constant currency, a company release said.
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