Capgemini's New Deals Help Push Double-Digit Revenue Growth
Capgemini grew by double digits in the third quarter as the company closed on a flurry of acquisitions and releases, the company reported Thursday.
The Paris-based solution provider reported revenue of $3.33 billion in the third quarter, up 17.2 percent.
According to CFO Aiman Azzat, revenue was higher thanks to new deals driven by customer demand, specifically around the company's digital business.
[Related: Capgemini CEO: iGate Best Option To Push Into U.S. Market, Others 'Unstable']
The company's consulting services business, because of its focus on digital transformation, has seen a rebound, with year-over-year growth in the mid-single digits.
Azzat added that the company's application services business continues to grow and now accounts for 60 percent of revenue.
During the quarter, Capgemini launched its Cloud Choice offering, opened two new innovation labs -- in Munich and Mumbai, India -- and closed the $4 billion acquisition of American solution provider iGate.
The company has already employed the new acquisition to win a number of new contracts, Azzat said.
After the acquisition of iGate on July 1, North America became the company's largest sales region, generating 31 percent of revenue and boosting the company's head count by about 3,500, to 178,045 employees.
On a like-for-like basis, Capgemini's North American and French businesses grew in the single digits, while its business in the Benelux region -- Belgium, the Netherlands and Luxembourg -- remained virtually stable, and business throughout the U.K. and Ireland was reduced by double digits because of a change of a major contract.
The company reported that its Latin American business was in a decline, thanks to the poor economic status of Brazil.
Business in the Asia Pacific geography, however, maintains double-digit growth, as does the remainder of Europe, with strength most notably in Nordic countries and Germany.
Thanks to the growth the company saw in the past quarter, Capgemini said it is guaranteeing the guidance it projected last quarter, forecasting that the company will grow 12 percent in 2015 at an operating margin rate of 10.3 percent with an operating cash flow exceeding $658 million.
PUBLISHED OCT. 29, 2015