IT firm Cognizant has announced that it will be cutting as many as 13,000 jobs in the next few quarters as the company chalks out a restructuring plan to lower its cost structure.
According to reports, Cognizant will ask as many as 7,000 of its core employees to exit the company by mid-2020, while another 6,000 roles will be impacted as the company exits its content moderation business.
In a post-earnings call, Cognizant’s CEO Brian Humphries explained that the company would remove 10,000 to 12,000 mid-to-senior level employees from their current roles, but it aims to re-skill and redeploy 5,000 of those impacted. So, the net reduction would be approximately 5,000 to 7,000 roles.
On exiting content moderation business, Humphries said during the call that Cognizant had decided that the work focused on determining whether content violated client standards was not part of its strategic vision. “Exiting this area will impact an additional approximately 6,000 roles worldwide, though the company intends to work with its partners to explore ways to transition the roles to alternative vendors, thereby reducing the impact to associates,” an Economic Times report quoted company executives as saying.
Cognizant said that these cost-cutting efforts, together with optimisation of its real estate portfolio, is expected to result in annualised gross run-rate savings of $500-550 million in 2021.
Cognizant also announced its third-quarter results, posting 4.2% year-on-year growth in revenue to $4.25 billion, while operating margins slid to 15.7% compared with 18.3% a year ago.
As of September 2019, Cognizant employed 289,900 employees, up marginally from 288,200 in June 2019.
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