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Cognizant Posts 16.6% Rise in Net Profit: Ahead of the Ticker

Tickers in this article: AOL CTSH MCD

NEW YORK (TheStreet) -- IT services firm Cognizant Technology Solutions reported $284.2 million in net profit for the first quarter, a 16.6% increase from the same quarter of 2012.

Revenue rose 18.1% to $2.02 billion from $1.71 billion the same period a year ago. The company had forecast revenue of at least $2 billion.

The firm also maintained its outlook of 17% revenue growth for this year. The company expects annual revenue to reach at least $8.6 billion.

Looking ahead to the next quarter, Cognizant expects revenues of at least $2.13 billion. Analysts had been expecting revenue of $2.11 billion, according Reuters.

The company also increased its share repurchase program by $500 million to $1.5 billion.

"Our performance during the first quarter was strong, and we are encouraged by the healthy demand for our broad range of services," CEO Francisco D'Souza said in a statement.

Internet provider AOL reported first-quarter revenue that grew 2% to $538 million on an increase in advertising revenue.

The company said total ad revenue grew to $359 million from $330 million, and that AOL Properties display ads experienced particular strength.

Growth in search revenue helped offset a loss in subscribers. AOL said subscription revenue fell 9% from the same period a year ago to $166 million, though the decline slowed. The average monthly churn rate slightly dipped to 1.9% from 2% in the year-ago quarter.

"Growth continues at AOL," Chairman and CEO Tim Armstrong said in a statement. "AOL's strategy of being the first scaled media and technology company is clearly represented in our results today, and we will continue to aggressively drive the company toward near-and long-term growth."

Earnings at the company rose to $25.9 million from $21.1 million a year ago.

McDonald's reported a bigger-than-expected drop in comparable sales in April, weighed down by global economic challenges.