Cognizant cuts costs by laying off 3,500 of its employees

Cognizant cuts costs by laying off 3,500 of its employees

Cognizant, a serious IT providers supplier, introduced Thursday, Might 4, that the corporate would lay off 3,500 staff, or about 1% of its workforce (principally non-billable), as the corporate anticipates a slowdown in income development for 2023 calculates.

Plans for value effectivity

The NextGen program at Cognizant began within the second quarter of 2023. As a part of the technique, 3,500 staff shall be laid off. As well as, the corporate will reposition workplace area, vacating almost 11 million sq. ft of workplace area in prime Indian cities.

In response to Financialexpress, Cognizant has launched a “NextGen” initiative to streamline its enterprise operations, consolidate and realign workplace area to align with the post-pandemic hybrid workspace, and simplify its working mannequin.

In response to the corporate, the corporate employed a complete of three,51,500 folks on the finish of the primary quarter, down 3,800 from the earlier quarter of 2022 however up 11,100 from the primary quarter of 2022.

Anticipated value discount

The Firm estimates that there shall be roughly $400 million in spend related to the NextGen program, of which $350 million is predicted in 2023 and $50 million in 2024. That features over $200 million in severance and different bills, primarily for company and non-billable staff, and roughly $200 million in workplace area consolidation prices. Nonetheless, Cognizant cannot predict that the NextGen program will end in important value financial savings till the second half of 2023, and would not count on the true property efforts to end in financial savings earlier than 2024.

Bookings for Cognizant’s order pipeline rose 28% 12 months over 12 months within the first quarter. Bookings grew 9% over the trailing 12 months to $25.6 billion, with a book-to-bill ratio of about 1.3 occasions.

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