Cognizant sees strong 2011 ahead, invests $500 million in India expansion

Cognizant on Monday reported better-than-expected fourth quarter results and said it would spend $500 million to expand its footprint in India through 2014.

The company, among the fastest growing offshore outsourcing firms, reported fourth quarter earnings of $206.2 million, or 66 cents a share, on revenue of $1.31 billion, up 45.2 percent from a year ago. Non-GAAP earnings were 70 cents a share.

Wall Street was expecting Cognizant to check in with earnings of 65 cents a share on revenue of $1.28 billion.

For 2010, Cognizant delivered earnings of $733.5 million, or $2.37 a share, on revenue of $4.59 billion, up 40 percent from a year ago.

Cognizant's outlook was also strong. The company projected first quarter earnings of 63 cents a share (67 cents a share non-GAAP) on revenue of $1.36 billion. Wall Street was looking for earnings of 64 cents a share on revenue of $1.31 billion.

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For 2011, Cognizant projected non-GAAP earnings of $2.85 a share on revenue of $5.79 billion, up 26 percent from 2010. That projection also handily beat estimates. Wall Street was expecting earnings of $2.70 a share on revenue of $5.73 billion.

Cognizant ended the fourth quarter with about 104,000 employees. As Cognizant grows and adds employees, it will have to expand. To that end, Cognizant said its $500 million investment in infrastructure will add more than 8 million square feet, enough to house more than 55,000 employees. The company added that it will create software development and training locations in Chennai, Pune, Coimbatore, and Kolkata.