Cognizant CFO: AI Puts Pressure on IT Spending, But BFSI Business Shows Strong Growth
Cognizant (Nasdaq: CTSH) CFO Jatin Dalal stated that the IT services industry's long-term slow growth reflects persistent pressure from AI and a general lack of discretionary spending across multiple end markets. However, he noted that the Banking, Financial Services, and Insurance (BFSI) segment was a significant exception, achieving double-digit growth in the second quarter. Dalal also mentioned that 40% of the company's software engineering work is now AI-assisted, and he expects headcount to remain relatively stable over the next 18 to 24 months. Regarding capital allocation, Cognizant plans to dedicate 50% to M&A, 25% to dividends, and 25% to share buybacks, having executed an additional $1 billion buyback program in May of this year.
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