Nasdaq-listed IT services firm Cognizant will roll out salary hikes to “eligible” employees from August 1, sources told Moneycontrol, a delay of around four months, compared to the previous year.
This comes at a time when the company is witnessing a weak demand environment due to macroeconomic issues, a factor that has impacted other IT companies too.
The Teaneck-based company has over 347,000 employees worldwide, of which around 254,000 are based in India.
Cognizant confirmed the development to Moneycontrol.
“We are committed to recognising the hard work and dedication of our associates through annual merit increases and bonuses. As part of this commitment, the merit increases for eligible associates will be awarded this year on August 1. Importantly, the majority of our associates have seen four merit increases within three years, with the last cycle being April 1, 2023,” the company told Moneycontrol in a statement.
“The company has also just rewarded annual bonuses to eligible associates globally. This continuity underscores our dedication to consistently acknowledge the contributions of our talented associates,” it further said.
With the latest move, a majority of Cognizant employees would have received four hikes in three years with the cycles being: October 2021, October 2022, April 2023, and August 2024.
For the October-December quarter, Cognizant posted a fall of 1.7 percent in revenue to $4.76 billion year-on-year (YoY). Sequentially, revenue decreased by 2.9 percent.
Cognizant said discretionary spending by clients has still not picked up.
Though a US-based company, Cognizant's performance reflects overall market sentiment for IT service companies in India such as Tata Consultancy Services, Infosys, and Wipro.
The company's net profit increased by over seven percent to $558 million YoY in the fourth quarter. Cognizant follows calendar year.
Cognizant has given a guidance of $4.68-$4.76 billion for Q1FY24, which translates to a decline of 2.7 percent to 1.2 percent.
In January, India’s second largest IT services company Infosys said it sees no immediate campus requirement. On the other hand, rival Tata Consultancy Services has commenced its campus hiring process for FY2024-25.
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