“We anticipate that personnel-related actions from this program will impact approximately 1 percent of our workforce,” Cognizant said.
Updated – Thu, 5/4/23 at 11:45am
New Delhi: IT giant Cognizant said Thursday it would lay off 3,500 workers, or about 1% of its workforce (mainly non-billable employees), as it expects revenue to slow in 2023. The company will also reduce real estate costs by “laying off 80,000 employees”. Seats and 11 million square feet of India’s largest cities”.
Cognizant has launched a “NextGen” initiative to simplify its operating model, optimize corporate functions and consolidate and realign office spaces to reflect a post-pandemic hybrid work environment. “We expect the planned personnel-related actions to affect approximately 3,500 employees, or approximately 1% of our workforce,” the company said in a statement.
“Our push for simplification will include operating in fewer layers in an effort to increase agility and enable faster decision making. continued investment in space modernization,” the firm added.
According to the company, the total number of employees at the end of the first quarter was 351,500, a decrease of 3,800 from the previous quarter of 2022 and an increase of 11,100 from the first quarter of 2022. Cognizant reported a 3% YoY increase in its net profit to $580 million in 3QFY23. The company reported first-quarter 2023 revenue of $4.8 billion, down 0.3% year-over-year.
“Our bookings accelerated during the quarter, which included several large transactions and a healthy mix of new and expanded business, reflecting the strength of our services, our brand and our long-standing relationships with customers. I am also appreciative of our voluntary attrition We are encouraged by the continued reduction in the population,” said Ravi Kumar.
Under the “NextGen” program, Cognizant expects to record approximately $400 million in costs, with approximately $350 million expected in 2023 and approximately $50 million in 2024.
