Cognizant Technology Solutions Corp. (CTSH)
Q4 2008 Earnings Call Transcript
February 13, 2009 9:00 a.m. ET

Executives

David Nelson - Vice President of Investor Relations
Francisco D''Souza - President and Chief Executive Officer
Gordon Coburn - Chief Financial and Operating Officer

Analysts

Edward Caso - Wachovia Capital Markets, LLC
George Price - Stifel Nicolaus & Company, Inc.
Julio Quinteros - Goldman Sachs & Co.
Rod Bourgeois – Sanford C. Bernstein & Co.
Ashwin Shirvaikar - Citigroup

Presentation

Operator

Ladies and gentlemen, thank you for standing by and welcome to the Cognizant Technology Solutions fourth quarter and year-end 2008 earnings conference call. All lines have been placed on mute to prevent any background noise. After the speakers'' remarks there will be a question-and-answer session. If you would like to ask a question during this time, simply press “*” then the number “1” on your telephone keypad. If you have already done so, please press the “#” key now then press “*1” again to ensure your question is registered. Thank you.

I would now like to turn the conference over to David Nelson, Vice President of Investor Relations at Cognizant. Please go ahead, sir.

David Nelson

Thank you and good morning, everyone. By now you should have received a copy of the company''s quarter four and year-end 2008 earnings release. If you have not a copy is available on our website cognizant.com.

The speakers we have on today''s call are Francisco D''Souza, President and Chief Executive Officer; and Gordon Coburn, Chief Financial and Operating Officer of Cognizant Technology Solutions.

Before we begin, I would like to remind you that some of the comments made on today''s call and some of the responses to your questions may contain forward-looking statements. These statements are subject to the risks and uncertainties as described in the company''s earnings release and other filings with the SEC.

I would now like to turn the call over to Francisco D''Souza. Francisco, please go ahead.

Francisco D''Souza

Thanks David and good morning, everyone. Thank you for joining Gordon and me today for Cognizant''s fourth quarter and full-year 2008 earnings call.

I would like to start my comments with an overview of our results and then I''ll discuss why Cognizant has continued to demonstrate industry leading growth. I will also talk about our view of the current economic environment and how we are responding in order to emerge in a strong position. And finally, I''ll discuss our guidance for the quarter and the full year of 2009.

We are pleased to report strong revenue growth this quarter, which exceeded our guidance despite the turbulent economic environment and the currency headwinds. In the fourth quarter we generated $753 million in revenue, versus our previous guidance of at least $746.7 million. This is an increase of 2.5% versus the third quarter of 2008, and 26% over the fourth quarter of 2007. Revenue for the full year was in excess of $2.8 billion or 32% over the prior year.

Our continued industry leading growth during the year validates the resilience of our business model and our strategy. Fundamental to our strategy is the ongoing commitment to invest for growth in the business. Our 2008 results reflect the effectiveness of this approach of reinvestment.

During the full year of 2008, a number of key areas in which we have been investing showed significant growth and are well poised for continued growth as we go into 2009. Specifically, service offerings like IT infrastructure services, and business and knowledge process outsourcing as well as geographies like Europe and Asia, which have been key areas of focused investment, grew well in 2008 and are poised for additional growth. I will cover some of these growth areas in more details in a moment.