Shares of Syntel (NASDAQ: SYNT) have jumped today, up by 14% as of 10:45 a.m. EDT, after the company reported fiscal third-quarter earnings. The IT outsourcing posted a healthy beat on both the top and bottom lines.
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Revenue in the third quarter fell 4% to $231.3 million, easily ahead of the $218.2 million in sales that analysts were expecting. The company swung to a net profit of $48 million, or $0.58 per share, also topping the consensus estimate of $0.41 per share in profits.
The comparable quarter in 2016 saw a large loss due to a one-time tax expense associated with repatriating foreign cash. Gross margin was 38.1%, and Syntel ended the quarter with $109 million in cash on the books.
"While we continue to see headwinds in certain areas, the demand for digital services was strong and our Insurance segment continued to post healthy growth," said CEO Rakesh Khanna in a statement. "We are encouraged by our Q3 results, but there is more work to be done. Our customers are at the center of our universe, and this focus will help Syntel return to growth over time."
Banking and financial services remain the largest segment, contributing nearly 45% of revenue. Syntel's global headcount now stands at 21,928, down from 23,055 a year ago. In terms of guidance, Syntel expects total 2017 revenue to be in the range of $890 million to $902 million, with earnings per share of $1.81 to $1.88, based on an exchange rate assumption of 65 Indian rupees to the U.S. dollar.
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