For the second consecutive quarter, India’s 3i Infotech took top spot as the fastest growing company, increasing sales by over 90% in the quarter to $72m. On the back of its stellar performance, along with the recent acquisition of J&B Software for over $25m, 3i Infotech has increased its revenue guidance for fiscal 2008 to between $290m and $320m from its previous target of about $250m.
While second-placed Cognizant’s figures appear impressive on the surface, they disappointed investors and precipitated a 19% fall in the company’s share price. The concerns centered on Cognizant’s revenue guidance for the fourth quarter which, at between $590m and $595m, came in below the analyst consensus of $598m. Cognizant derives approximately 50% of its revenue from financial services, and the concern is that the company’s revenue stream is beginning to feel the effects of the US credit squeeze.
Of the big names in the global IT services sector, Accenture once again led the pack. The company’s fourth-quarter sales rose 29% to $5.1bn, with consulting sales up 38% and 17% growth in the outsourcing business. In geographic terms, EMEA sales jumped 48% to $2.4bn, with Asia-Pacific also performing well, boosting revenue by 39% to $487.8m.
Market leader IBM Global Services continues to perform well, following up a sales increase of 10% in the previous quarter with growth of 13% this time around. This was well up on close rivals such as BT Global Services and EDS, which both reported 6% revenue growth. EDS’s net income scraped in just above expectations, but the company continues to underperform slightly and now expects bookings for the full year of between $21bn and $23bn, a subtle change from the $23bn previously forecast.
In Europe, the organic growth of the big vendors was less impressive than in the previous quarter of the year. Capgemini’s organic expansion was 6% in the three months to the end of September, compared to 12% last time around, while Ementor’s 4% pro forma expansion was down from 7% in the second quarter.
For the third consecutive quarter, European giant T-Systems ranked as the worst performing IT services vendor. The company’s sales slumped 8% to $4.3bn, dragged down by German revenue which finished the quarter 11% below the level of the previous year. Over the first nine months of 2007, T-Systems’ revenue has fallen 7%, but if there is a silver lining for the company, it comes in the form of its international business, which has grown over 8% since the beginning of the year.
T-Systems was once again joined in the list of underperforming IT services companies by Unisys. The Blue Bell, Pennsylvania-based company reported flat services sales of $1.2bn, with rising outsourcing revenue balanced out by a fall in infrastructure services and core maintenance sales. Hardware revenue fell 8.8% to $175.5m, dragging total quarterly sales down 1.2% to $1.4bn.
