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Cognizant Reports Record Third Quarter Results
Exceeds Revenue and Earnings Expectations

Cognizant Technology Solutions Corporation (NASDAQ: CTSH), a leading provider of IT services, today announced its financial results for the three and nine months ended September 30, 2006.

  Highlights - Third Quarter 2006
   -- Quarterly revenue increased to $377.5 million, up 60% from the year-
      ago quarter.
   -- Quarterly diluted EPS on a GAAP basis was $0.40, compared to $0.28 in
      the year-ago quarter.
   -- Quarterly diluted EPS on a non-GAAP basis was $0.45, excluding stock-
      based compensation expense of $0.05.

Revenue for the third quarter of 2006 increased to $377.5 million, up 12% sequentially from $336.8 million in the second quarter of 2006, and up 60% from $235.5 million in the third quarter of 2005. GAAP net income was $61.0 million, or $0.40 per diluted share, compared to $40.6 million, or $0.28 per diluted share, in the third quarter of 2005. Diluted earnings per share on a non-GAAP basis was $0.45. GAAP operating margin for the quarter was 18.2%. Excluding stock based compensation expense of $7.5 million, non-GAAP operating margin was 20.2%, at the high end of the Company's targeted 19-20% range. Reconciliations of these non-GAAP financial measures to GAAP operating results and diluted EPS are included at the end of this release.

  Highlights - Nine Months Ended September 30, 2006
   -- Revenue increased to $999.8 million, up 59% from the year-ago period.
   -- Diluted EPS on a GAAP basis was $1.09, compared to $0.74 in the year-
      ago period.
   -- Diluted EPS on a non-GAAP basis was $1.22, excluding stock-based
      compensation expense of $0.13.

Revenue for the nine months ended September 30, 2006 increased to $999.8 million, up 59% from $628.9 million in the same period of 2005. GAAP net income was $163.3 million, or $1.09 per diluted share, compared to $108.6 million, or $0.74 per diluted share, in the same period of 2005. Diluted earnings per share on a non-GAAP basis was $1.22. GAAP operating margin was 18.3%. Excluding stock based compensation expense of $21.8 million, non-GAAP operating margin was 20.4%. Reconciliations of these non-GAAP financial measures to GAAP operating results and diluted EPS are included at the end of this release.

"We are very pleased with our strong financial performance in the third quarter, which further extends our track record of industry-leading growth," said Lakshmi Narayanan, President and CEO of Cognizant. "Our results were driven by our ability to leverage Cognizant's leadership in our core vertical markets and key solution offerings to win new business from both new and existing customers. During the quarter, we experienced strong growth across our industry segments, including strengthening our industry leadership in healthcare, life sciences and financial services. Demand for our broad range of solutions was particularly evident in testing, ERP/CRM, complex systems development, high-end vertical BPO and IT infrastructure management, all areas where we have translated our deep technology and domain expertise into strong market positions over the last several quarters. We also maintained our focus on building the foundation to support the next phase of our growth by investing heavily in our capabilities, people and infrastructure on a global scale."

Narayanan continued, "As we move forward into 2007, we recognize that what distinguishes Cognizant in the market is our unparalleled commitment to partnering with our customers to strengthen their business while providing a tangible return on their IT investments. We are confident that our commitment to generating high levels of customer satisfaction will continue to fuel strong demand for our services and drive our industry-leading growth well into 2007."

2006 Outlook - Fourth Quarter & Full Year

Based on current visibility, the Company is now providing the following guidance:

   -- Fourth quarter 2006 revenue anticipated to be at least $405 million,
      up over 57% compared to the fourth quarter of 2005.
   -- Fourth quarter 2006 diluted EPS expected to be $0.42 on a GAAP basis,
      and $0.47 on a non-GAAP basis, which excludes a stock-based
      compensation expense of $0.05.
   -- Fiscal 2006 revenue now anticipated to be at least $1.405 billion, up
      approximately 59% compared to 2005.
   -- Fiscal 2006 diluted EPS expected to be $1.51 on a GAAP basis.
   -- Fiscal 2006 diluted EPS expected to be $1.68 on a non-GAAP basis,
      which excludes a stock-based compensation expense of $0.17.
   -- Total headcount by end of 2006 expected to be approximately 38,000.

"Cognizant's outstanding growth during the quarter is a testament to the strength of our long-standing reinvestment strategy," said Gordon Coburn, Chief Financial Officer of Cognizant. "During the third quarter, we aggressively invested in building our employee base, with a net addition of approximately 4,700 employees around the world. We also continued to expand our European business, where growth exceeded the Company average for the second consecutive quarter. Furthermore, as we announced this morning, we continue to make significant investments in our global infrastructure and campuses across India to enhance our flexibility to grow the Company as demand for our services continues to escalate. As a result of our strong performance in the first nine months of the year, combined with the overall positive demand environment, we are raising guidance for Fiscal 2006."

Conference Call

Cognizant will host a conference call November 2, at 9:00 a.m. (ET) to discuss the Company's quarterly results. To listen to the call please dial (888) 652-6834 domestically or (706) 679-3288 internationally. The call will also be broadcast live via the Internet at Cognizant's web site, www.cognizant.com. Please go to the web site at least fifteen minutes prior to the call to register, download and install any necessary audio software. A replay will be made available on the web site at www.cognizant.com or by calling (800) 642-1687 for domestic callers and (706) 645-9291 for international callers and entering "8714977" from two hours after the end of the call until 11:59 p.m. (ET) on November 9, 2006.

About Cognizant

Cognizant (NASDAQ: CTSH) is a leading provider of IT services. Focused on delivering strategic information technology solutions that address the complex business needs of its clients, Cognizant uses its own on-site/offshore outsourcing model to provide applications management, development, integration, and reengineering; infrastructure management; business process outsourcing; and numerous related services, such as enterprise consulting, technology architecture, program management, and change management.

Cognizant's more than 35,000 employees are committed to partnerships that sustain long-term, proven value for customers by delivering high-quality, cost-effective solutions through its development centers in India and on-site client teams. Cognizant maintains P-CMM and SEI-CMM Level 5 assessments from an independent third-party assessor, was recently named one of Forbes' Best Small Companies in America for the fourth consecutive year, and ranked among the top information technology companies in BusinessWeek's Hot Growth Companies. Cognizant is a member of the NASDAQ-100 Index. Find additional information about Cognizant at http://www.cognizant.com/.

Forward-Looking Statements

This press release includes statements which may constitute forward- looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, the accuracy of which are necessarily subject to risks, uncertainties, and assumptions as to future events that may not prove to be accurate. Factors that could cause actual results to differ materially from those expressed or implied include general economic conditions and the factors discussed in our most recent Form 10-K and other filings with the Securities and Exchange Commission. Cognizant undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.

About Non-GAAP Financial Measures

To supplement the consolidated financial statements presented in accordance with GAAP, this press release includes the following measures defined by the Securities and Exchange Commission as non-GAAP financial measures: non-GAAP operating margin and non-GAAP diluted earnings per share. These non-GAAP measures are not based on any comprehensive set of accounting rules or principles and should not be considered a substitute for, or superior to, financial measures calculated in accordance with GAAP, and may be different from non-GAAP measures used by other companies. In addition, these non-GAAP measures, the financial statements prepared in accordance with GAAP and reconciliations of Cognizant's GAAP financial statements to such non-GAAP measures should be carefully evaluated.

For its internal management reporting and budgeting purposes, Cognizant's management uses financial statements that do not include stock-based compensation expense related to employee stock options and employee stock purchases for financial and operational decision making, to evaluate period- to-period comparisons and for making comparisons of Cognizant's operating results to that of its competitors. Moreover, because of varying available valuation methodologies, subjective assumptions and the variety of award types that companies can use when adopting FAS 123R, Cognizant's management believes that providing a non-GAAP financial measure that excludes stock-based compensation allows investors to make additional comparisons between Cognizant's operating results to those of other companies. Accordingly, Cognizant believes that the presentation of non-GAAP operating margin and non- GAAP diluted earnings per share, when read in conjunction with the company's reported results, can provide useful supplemental information to investors and management regarding financial and business trends relating to its financial condition and results of operations.

A limitation of using non-GAAP operating margin and non-GAAP diluted earnings per share versus operating margin and diluted earnings per share calculated in accordance with GAAP is that non-GAAP operating margin and non- GAAP diluted earnings per share exclude costs, namely, stock-based compensation, that are recurring. Stock-based compensation has been and will continue to be for the foreseeable future a significant recurring expense in Cognizant's business. Management compensates for this limitation by providing specific information regarding the GAAP amounts excluded from non-GAAP operating margin and non-GAAP diluted earnings per share and evaluating such non-GAAP financial measures with financial measures calculated in accordance with GAAP.

                COGNIZANT TECHNOLOGY SOLUTIONS CORPORATION
             CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                               (Unaudited)

                  (In thousands, except per share data)


                                  Three Months Ended    Nine Months Ended
                                    September 30,         September 30,
                                   2006        2005      2006        2005

  Revenues                       $377,522    $235,536  $999,837    $628,928

  Cost of revenues (exclusive of
   depreciation and amortization
   shown separately below)        208,427     128,175   555,335     343,937

  Selling, general and
   administrative expenses         91,470      54,759   238,219     142,295

  Depreciation and amortization
   expense                          8,861       5,581    23,692      16,120
  Income from operations           68,764      47,021   182,591     126,576

  Other income (expense):
  Interest income                   4,787       2,221    12,077       6,122
  Other income / (expense), net      (611)        130       856        (589)
  Total other income / (expense)    4,176       2,351    12,933       5,533

  Income before provision for
   income taxes                    72,940      49,372   195,524     132,109

  Provision for income taxes       11,913       8,789    32,262      23,516

  Net income                      $61,027     $40,583  $163,262    $108,593

  Basic earnings per share          $0.43       $0.30     $1.16       $0.80

  Diluted earnings per share        $0.40       $0.28     $1.09       $0.74

  Weighted average number of
   common shares outstanding      141,202     137,186   140,470     135,786

  Weighted average number of
   common and dilutive shares
   outstanding                    150,836     147,281   150,228     146,552




                  COGNIZANT TECHNOLOGY SOLUTIONS CORPORATION
       Reconciliation of Non-GAAP Financial Measures to Comparable GAAP
                                   Measures
                     (In thousands, except per share data)



                                        Three Months Ended September 30,
                                          2006       2006         2006
                                          GAAP   Adjustments    Non-GAAP


     Income from operations               $68,764    $7,470(a)   $76,234

     Operating margin                       18.2%      2.0%(a)     20.2%

     Diluted earnings per share             $0.40     $0.05(b)     $0.45



                                        Nine Months Ended September 30,
                                          2006       2006         2006
                                          GAAP   Adjustments    Non-GAAP

     Income from operations              $182,591   $21,841(c)  $204,432

     Operating margin                       18.3%      2.1%(c)     20.4%

     Diluted earnings per share             $1.09     $0.13(d)     $1.22


  Notes:
   (a) Adjustment to exclude stock-based compensation of $7,470 from income
       from operations of which $3,441 was reported in cost of revenues and
       $4,029 was reported in selling, general and administrative expenses
       in our unaudited condensed consolidated statement of operations.

   (b) Adjustment to exclude the per share effect of stock-based
       compensation expense net of the related tax benefit of $541.

   (c) Adjustment to exclude stock-based compensation of $21,841 from income
       from operations of which $9,920 was reported in cost of revenues and
       $11,921 was reported in selling, general and administrative expenses
       in our unaudited condensed consolidated statement of operations.

   (d) Adjustment to exclude the per share effect of stock-based
       compensation expense net of the related tax benefit of $2,516.



                 COGNIZANT TECHNOLOGY SOLUTIONS CORPORATION
     CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION (Unaudited)
                               (In thousands)



                                          September 30,     December 31,
                                              2006              2005

  Assets

  Current Assets

    Cash and cash equivalents                    $197,700         $196,938

    Short-term investments                        337,898          227,063

    Trade accounts receivable, net of
     allowances of $3,472 and $2,325,
     respectively                                 253,933          153,971

    Unbilled accounts receivable                   42,789           22,725

    Deferred income tax assets, net                58,542           42,752

    Other current assets                           30,355           19,974

             Total Current Assets                 921,217          663,423

  Property and equipment, net                     198,108          146,982

  Goodwill                                         26,775           18,223

  Other Intangible assets, net                     21,467           16,277

  Deferred income tax assets, net                   1,451           17,247

  Other assets                                     13,494            7,741

  Total Assets                                 $1,182,512         $869,893


  Liabilities and Stockholders' Equity

  Current Liabilities

  Accounts payable                                $27,648          $16,420

  Accrued expenses and other
   liabilities                                    185,633          137,375

         Total Current Liabilities                213,281          153,795

  Other noncurrent liabilities                      2,673            1,953

  Total Liabilities                               215,954          155,748

  Stockholders' Equity                            966,558          714,145

  Total Liabilities and Stockholders'
   Equity                                      $1,182,512         $869,893

FCMN Contact: christina.corcoran@fd.com

SOURCE: Cognizant Technology Solutions Corporation

CONTACT: Gordon Coburn, Chief Financial Officer, +1-201-678-2712; or
Investors: Gordon McCoun, or Press: Brian Maddox or Scot Hoffman,
scot.hoffman@fd.com, all of Financial Dynamics, +1-212-850-5600

Web site: http://www.cognizant.com/

Financial