Due to robust demand for its services, Cognizant Technology Solutions Corp. lifted its revenue growth projection into the double digits, but attrition remains a major concern for the US-based firm, which employs over two-thirds of its workforce in India.

In the second quarter, the Nasdaq-listed company recorded a 31 percent attrition rate, the highest among IT services companies in the three-month period ending June 30. It had a quarterly annualized attrition rate of 21 percent in the prior quarter. In the second quarter, voluntary attrition was at 29 percent. Over 301,200 people work for the company.

Cognizant CEO Brian Humphries said earlier that the company had to let go of new business due to its inability to acquire talent, following the company's first quarter results that attrition has been one of the company's main worries. This is relevant since the software sector is experiencing a surge in outsourcing, particularly as a result of the pandemic.

In the second quarter, Cognizant's sales of $4.6 billion increased 14.6 percent year over year (12.0 percent in constant currency), marking the company's biggest quarterly revenue to date. Digital revenue increased by over 20 percent year over year and now accounts for 44 percent of total revenue.

Financial Services revenue increased 7.6 percent year over year, or 4.8 percent in constant currency, thanks to recently completed acquisitions and increased digital revenue. As our clients minimize the cost of managing their legacy systems and operations, revenue decreases related to its non-digital services continue to put pressure on performance.

Revenues from healthcare increased 14.5 percent year over year, or 13.4 percent in constant currency. Our integrated software solutions for healthcare clients, as well as broad-based demand from its life sciences customers, contributed to its growth.

Sales from Products and Resources increased by 21.7 percent year over year.

Revenues in Communications, Media, and Technology (which account for 15.3 percent of total revenue) increased by 21.2 percent year over year, or 17.9 percent in constant currency. Recent acquisitions contributed to revenue growth, as did growing demand from technology clients.

Revenue decreases from non-digital services continued to put pressure on results, according to the company, as clients reduced the cost of managing their legacy systems and processes.

In its statement, the corporation made a special point of how year-over-year increase across all categories reflects the impact of the pandemic and the April 2020 ransomware attack on 2020 revenues.

“Second quarter top-line results exceeded our guidance, driven by improved demand for our services and momentum in our digital revenue, and we increased our full-year 2021 revenue growth to 10.2-11.2%,” said Jan Siegmund, Chief Financial Officer. “To meet the strong client demand for our services, we have continued to scale our recruiting capabilities and invest in our people."