Figurines with computers and smartphones are seen in front of Cognizant logo in this illustration taken, February 19, 2024. REUTERS/Dado Ruvic/Illustration
(Reuters) - Cognizant Technology said on Tuesday its board has approved a $2 billion increase to the IT consulting company's current share repurchase plan, as it sharpens focus on bolstering shareholder returns.
With this, the total amount authorized under the program is $3.1 billion. The company said it expects to buy back shares worth $1.1 billion this year, an increase of $500 million over its prior expectation.
Shares of Cognizant, which is scheduled to host its investor day later on Tuesday, rose 1.7% in early trading. It is expected to share its long-term growth plans and initiatives to improve its artificial-intelligence offerings.
The company has been grappling with choppy IT services demand as economic uncertainties and high interest rates have pressured enterprise budgets, causing clients to rein in spending. Last month, Cognizant forecast its annual revenue below analysts' estimate.
It is also facing activist investor involvement from Mantle Ridge, which has been in discussions with the company since mid-2024.
The Wall Street Journal reported earlier this month that Mantle Ridge has built a stake worth more than $1 billion in Cognizant and has been privately engaging with the company about its progress on boosting its share price.
(Reporting by Priyanka.G in Bengaluru; Editing by Shilpi Majumdar)
