Item 1. Consolidated Financial Statements (Unaudited).

COGNIZANT TECHNOLOGY SOLUTIONS CORPORATION

CONSOLIDATED STATEMENTS OF FINANCIAL POSITION

(Unaudited)

(in millions, except par values)			March 31, 2025						December 31, 2024
Assets
Current assets:
Cash and cash equivalents			$	1,980					$	2,231
Short-term investments			12						12
Trade accounts receivable, net			4,239						4,059
Other current assets			1,314						1,202
Total current assets			7,545						7,504
Property and equipment, net			988						994
Operating lease assets, net			555						552
Goodwill			7,006						6,953
Intangible assets, net			1,555						1,599
Deferred income tax assets, net			1,216						1,248
Long-term investments			94						90
Other noncurrent assets			1,008						1,026
Total assets			$	19,967					$	19,966
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable			$	326					$	340
Deferred revenue			519						450
Short-term debt			33						33
Operating lease liabilities			155						152
Accrued expenses and other current liabilities			2,373						2,610
Total current liabilities			3,406						3,585
Deferred revenue, noncurrent			33						30
Operating lease liabilities, noncurrent			424						420
Deferred income tax liabilities, net			171						154
Long-term debt			567						875
Other noncurrent liabilities			467						494
Total liabilities			5,068						5,558
Commitments and contingencies (See Note 10)
Stockholders’ equity:
Preferred stock, $0.10 par value, 15 shares authorized, none issued			—						—
Class A common stock, $0.01 par value, 1,000 shares authorized, 493 and 495 shares issued and outstanding as of March 31, 2025 and December 31, 2024, respectively			5						5
Additional paid-in capital			19						13
Retained earnings			15,040						14,686
Accumulated other comprehensive income (loss)			(165)						(296)
Total stockholders’ equity			14,899						14,408
Total liabilities and stockholders’ equity			$	19,967					$	19,966

The accompanying notes are an integral part of the unaudited consolidated financial statements.

Cognizant Technology Solutions			4			March 31, 2025 Form 10-Q

COGNIZANT TECHNOLOGY SOLUTIONS CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

(in millions, except per share data)			Three Months Ended March 31,
			2025						2024
Revenues			$	5,115					$	4,760
Operating expenses:
Cost of revenues (exclusive of depreciation and amortization expense shown separately below)			3,397						3,146
Selling, general and administrative expenses			791						765
Restructuring charges			—						23
Depreciation and amortization expense			136						131
(Gain) on sale of property and equipment			(62)						—
Income from operations			853						695
Other income (expense), net:
Interest income			30						30
Interest expense			(12)						(11)
Foreign currency exchange gains (losses), net			2						6
Other, net			(1)						2
Total other income (expense), net			19						27
Income before provision for income taxes			872						722
Provision for income taxes			(213)						(179)
Income (loss) from equity method investments			4						3
Net income			$	663					$	546
Basic earnings per share			$	1.34					$	1.10
Diluted earnings per share			$	1.34					$	1.10
Weighted average number of common shares outstanding - Basic			494						497
Dilutive effect of shares issuable under stock-based compensation plans			1						1
Weighted average number of common shares outstanding - Diluted			495						498

The accompanying notes are an integral part of the unaudited consolidated financial statements.

Cognizant Technology Solutions			5			March 31, 2025 Form 10-Q

COGNIZANT TECHNOLOGY SOLUTIONS CORPORATION

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)

(in millions)			Three Months Ended March 31,
			2025						2024
Net income			$	663					$	546
Change in Accumulated other comprehensive income (loss), net of tax:
Foreign currency translation adjustments			103						(73)
Unrealized gains and losses on cash flow hedges			28						11
Other comprehensive income (loss)			131						(62)
Comprehensive income			$	794					$	484

The accompanying notes are an integral part of the unaudited consolidated financial statements.

Cognizant Technology Solutions			6			March 31, 2025 Form 10-Q

COGNIZANT TECHNOLOGY SOLUTIONS CORPORATION

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(Unaudited)

(in millions, except per share data)						Class A Common Stock												Additional Paid-in Capital						Retained Earnings						Accumulated Other Comprehensive Income (Loss)						Total Stockholders' Equity
			Shares						Amount
Balance, December 31, 2024						495						$	5					$	13					$	14,686					$	(296)					$	14,408
Net income						—						—						—						663						—						663
Other comprehensive income (loss)						—						—						—						—						131						131
Common stock issued, stock-based compensation plans						1						—						19						—						—						19
Stock-based compensation expense						—						—						42						—						—						42
Repurchases of common stock						(3)						—						(55)						(155)						—						(210)
Dividends declared, $0.31 per share						—						—						—						(154)						—						(154)
Balance, March 31, 2025						493						$	5					$	19					$	15,040					$	(165)					$	14,899

(in millions, except per share data)						Class A Common Stock												Additional Paid-in Capital						Retained Earnings						Accumulated Other Comprehensive Income (Loss)						Total Stockholders' Equity
			Shares						Amount
Balance, December 31, 2023						498						$	5					$	15					$	13,301					$	(94)					$	13,227
Net income						—						—						—						546						—						546
Other comprehensive income (loss)						—						—						—						—						(62)						(62)
Common stock issued, stock-based compensation plans						1						—						20						—						—						20
Stock-based compensation expense						—						—						42						—						—						42
Repurchases of common stock						(2)						—						(57)						(76)						—						(133)
Dividends declared, $0.30 per share						—						—						—						(150)						—						(150)
Balance, March 31, 2024						497						$	5					$	20					$	13,621					$	(156)					$	13,490

The accompanying notes are an integral part of the unaudited consolidated financial statements.

Cognizant Technology Solutions			7			March 31, 2025 Form 10-Q

COGNIZANT TECHNOLOGY SOLUTIONS CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(in millions)			For the Three Months Ended March 31,
			2025						2024
Cash flows from operating activities:
Net income			$	663					$	546
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization			136						133
Deferred income taxes			54						(26)
Stock-based compensation expense			42						42
Gain on sale of property and equipment			(62)						—
Other, net			(6)						32
Changes in assets and liabilities, net of effects of businesses acquired:
Trade accounts receivable, current			(177)						39
Other current and noncurrent assets			(42)						(347)
Accounts payable			9						(47)
Deferred revenues, current and noncurrent			70						50
Other current and noncurrent liabilities			(287)						(327)
Net cash provided by operating activities			400						95
Cash flows from investing activities:
Purchases of property and equipment			(77)						(79)
Proceeds from sale of property and equipment			70						—
Proceeds from maturity of held-to-maturity investment securities			—						3
Proceeds from maturity or sale of other investments			—						259
Payments for business combinations, net of cash acquired			—						(421)
Net cash (used in) investing activities			(7)						(238)
Cash flows from financing activities:
Issuance of common stock under stock-based compensation plans			19						20
Repurchases of common stock			(209)						(133)
Repayment of Term Loan borrowings and earnout and finance lease obligations			(12)						(40)
Repayment of notes outstanding under the revolving credit facility			(300)						—
Dividends paid			(155)						(151)
Net cash (used in) financing activities			(657)						(304)
Effect of exchange rate changes on cash, cash equivalents and restricted cash and cash equivalents			13						(39)
(Decrease) in cash, cash equivalents and restricted cash and cash equivalents			(251)						(486)
Cash, cash equivalents and restricted cash and cash equivalents beginning of year			2,231						2,717
Cash and cash equivalents, end of period			$	1,980					$	2,231

The accompanying notes are an integral part of the unaudited consolidated financial statements.

Cognizant Technology Solutions			8			March 31, 2025 Form 10-Q

COGNIZANT TECHNOLOGY SOLUTIONS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Note 1 — Interim Consolidated Financial Statements

The terms “Cognizant,” “we,” “our,” “us” and “the Company” refer to Cognizant Technology Solutions Corporation and its subsidiaries unless the context indicates otherwise. We have prepared the accompanying unaudited consolidated financial statements included herein in accordance with GAAP and the Exchange Act. The accompanying unaudited consolidated financial statements should be read in conjunction with our audited consolidated financial statements (and notes thereto) included in our Annual Report on Form 10-K for the year ended December 31, 2024. In our opinion, all adjustments considered necessary for a fair statement of the accompanying unaudited consolidated financial statements have been included and all adjustments are of a normal and recurring nature. Operating results for the interim periods are not necessarily indicative of results that may be expected to occur for the entire year.

Sale of Property and Equipment

During the three months ended March 31, 2025, we sold an office complex in India for proceeds of $70 million and recorded a gain on the transaction of $62 million, which was reported in "(Gain) on sale of property and equipment" on our unaudited consolidated statement of operations. As of December 31, 2024, the physical assets held for sale related to this office complex were reported in "Other current assets" as disclosed in Note 6 in our Annual Report on Form 10-K for the ended December 31, 2024.

New Accounting Pronouncements

Date Issued and Topic			Effective Date			Description			Impact
December 2023 Income Taxes (Topic 740): Improvements to Income Tax Disclosures			Annual period starting in 2025 Prospective basis			The standard requires enhanced income tax disclosures primarily related to the income tax rate reconciliation and income taxes paid information.			We are currently evaluating the impact of the new standard on our disclosures.
November 2024 Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40)			Annual period starting in 2027 and interim periods starting in 2028 Prospective basis			The standard is intended to improve financial reporting by requiring that public business entities disclose additional information about specific expense categories in the notes to financial statements at interim and annual reporting periods.			We are currently evaluating the impact of the new standard on our disclosures.

Cognizant Technology Solutions			9			March 31, 2025 Form 10-Q

Note 2 — Revenues and Trade Accounts Receivable

Disaggregation of Revenues

The tables below present disaggregated revenues from contracts with clients by client location, service line and contract type for each of our reportable business segments. We believe this disaggregation best depicts how the nature, amount, timing and uncertainty of revenues and cash flows are affected by industry, market and other economic factors. Our consulting and technology services include consulting, application development, systems integration, quality engineering and assurance services as well as software solutions and related services while our outsourcing services include application maintenance, infrastructure and security as well as business process services. Revenues are attributed to geographic regions based upon client location, which is the client's billing address. Substantially all revenues in the North America region relate to clients in the United States.

						Three Months Ended March 31, 2025
(in millions)						Health Sciences						Financial Services						Products and Resources						Communications, Media and Technology						Total
Revenues
Geography:
North America						$	1,330					$	1,043					$	911					$	570					$	3,854
United Kingdom						49						153						137						118						457
Continental Europe						160						147						153						33						493
Europe - Total						209						300						290						151						950
Rest of World						32						119						77						83						311
Total						$	1,571					$	1,462					$	1,278					$	804					$	5,115
Service line:
Consulting and technology services						$	870					$	1,020					$	887					$	449					$	3,226
Outsourcing services						701						442						391						355						1,889
Total						$	1,571					$	1,462					$	1,278					$	804					$	5,115
Type of contract:
Time and materials						$	481					$	764					$	556					$	434					$	2,235
Fixed-price						791						651						634						334						2,410
Transaction or volume-based						299						47						88						36						470
Total						$	1,571					$	1,462					$	1,278					$	804					$	5,115

Cognizant Technology Solutions			10			March 31, 2025 Form 10-Q

						Three Months Ended March 31, 2024
(in millions)						Health Sciences						Financial Services						Products & Resources						Communications, Media and Technology						Total
Revenues
Geography:
North America						$	1,209					$	977					$	773					$	562					$	3,521
United Kingdom						44						143						131						138						456
Continental Europe						135						151						145						52						483
Europe - Total						179						294						276						190						939
Rest of World						28						114						84						74						300
Total						$	1,416					$	1,385					$	1,133					$	826					$	4,760
Service line:
Consulting and technology services						$	802					$	953					$	736					$	464					$	2,955
Outsourcing services						614						432						397						362						1,805
Total						$	1,416					$	1,385					$	1,133					$	826					$	4,760
Type of contract:
Time and materials						$	490					$	783					$	470					$	467					$	2,210
Fixed-price						670						556						582						328						2,136
Transaction or volume-based						256						46						81						31						414
Total						$	1,416					$	1,385					$	1,133					$	826					$	4,760

Costs to Fulfill

The following table shows significant movements in the capitalized costs to fulfill for the three months ended March 31:

(in millions)						2025						2024
Beginning balance						$	209					$	245
Costs capitalized						10						14
Amortization expense						(20)						(22)
Impairment charge						(7)						(2)
Ending balance						$	192					$	235

Costs to obtain contracts were immaterial for the periods disclosed.

Contract Balances

The table below shows significant movements in contract assets (current and noncurrent) for the three months ended March 31:

(in millions)						2025						2024
Beginning balance						$	386					$	316
Revenues recognized during the period but not billed						327						248
Amounts reclassified to trade accounts receivable						(259)						(180)
Ending balance						$	454					$	384

Cognizant Technology Solutions			11			March 31, 2025 Form 10-Q

The table below shows significant movements in the deferred revenue balances (current and noncurrent) for the three months ended March 31:

(in millions)						2025						2024
Beginning balance						$	480					$	427
Amounts billed but not recognized as revenues						374						311
Revenues recognized related to the beginning balance of deferred revenue						(302)						(262)
Amounts acquired in business combinations						—						9
Ending balance						$	552					$	485

Revenues recognized during the three months ended March 31, 2025 for performance obligations satisfied or partially satisfied in previous periods were immaterial.

Remaining Performance Obligations

As of March 31, 2025, the aggregate amount of transaction price allocated to remaining performance obligations was $5,627 million, of which approximately 35% is expected to be recognized as revenues within 1 year, approximately 55% is expected to be recognized as revenues within 2 years and approximately 90% is expected to be recognized as revenues within 5 years. Disclosure is not required for performance obligations that meet any of the following criteria:

(1)contracts with a duration of one year or less as determined under ASC Topic 606: "Revenue from Contracts with Customers",

(2)contracts for which we recognize revenues based on the right to invoice for services performed,

(3)variable consideration allocated entirely to a wholly unsatisfied performance obligation or to a wholly unsatisfied promise to transfer a distinct good or service that forms part of a single performance obligation in accordance with ASC 606-10-25-14(b), for which the criteria in ASC 606-10-32-40 have been met, or

(4)variable consideration in the form of a sales-based or usage-based royalty promised in exchange for a license of intellectual property.

Many of our performance obligations meet one or more of these exemptions and therefore are not included in the remaining performance obligation amount disclosed above.

Trade Accounts Receivable and Allowance for Credit Losses

The following table presents the activity in the allowance for credit losses for trade accounts receivable for the three months ended March 31:

(in millions)						2025						2024
Beginning balance						$	26					$	32
Credit loss expense (1)						4						1
Write-offs charged against the allowance						(2)						(3)
Ending balance						$	28					$	30

(1)Reported in "Selling, general and administrative expenses" in our unaudited consolidated statements of operations.

Note 3 — Restructuring Charges

At the end of 2024, we completed our NextGen program. NextGen charges for the three months ended March 31, 2024 were $23 million and included $8 million of employee separation costs, $14 million of facility exit costs and $1 million of third party and other costs. We did not incur any costs related to the NextGen program during the three months ended March 31, 2025.

The costs related to our NextGen program are reported in "Restructuring charges" in our consolidated statements of operations. We do not allocate these charges to individual segments in internal management reports used by the CODM. Accordingly, such expenses are separately disclosed in our segment reporting as “unallocated costs.” See Note 11.

Cognizant Technology Solutions			12			March 31, 2025 Form 10-Q

Changes in our accrued employee separation costs included in "Accrued expenses and other current liabilities" in our unaudited consolidated statements of financial position are presented in the table below for the three months ended March 31:

(in millions)						2025						2024
Beginning balance						$	35					$	42
Employee separation costs accrued						—						8
Payments made						(20)						(21)
Ending balance						$	15					$	29

Note 4 — Accrued Expenses and Other Current Liabilities

Accrued expenses and other current liabilities were as follows:

(in millions)			March 31, 2025						December 31, 2024
Compensation and benefits			$	1,171					$	1,499
Customer volume and other incentives			261						247
Liabilities related to the resale of third-party products			245						154
Professional fees			185						171
Income taxes			128						100
Other			383						439
Total accrued expenses and other current liabilities			$	2,373					$	2,610

Note 5 — Debt

We have a Credit Agreement providing for a $650 million Term Loan and a $1,850 million unsecured revolving credit facility, which are each due to mature in October 2027. During the third quarter of 2024, we borrowed $600 million under our revolving credit facility to partially fund the acquisition of Belcan. We repaid $300 million during the fourth quarter of 2024 and the remaining $300 million during the first quarter of 2025.

The Credit Agreement requires interest to be paid, at our option, at either the Term Benchmark, Adjusted Daily Simple RFR or the ABR Rate (each as defined in the Credit Agreement), plus, in each case, an Applicable Margin (as defined in the Credit Agreement). Initially, the Applicable Margin is 0.875% with respect to Term Benchmark loans and RFR loans and 0.00% with respect to ABR loans. Subsequently, the Applicable Margin with respect to Term Benchmark loans and RFR loans will be determined quarterly and may range from 0.75% to 1.125%, depending on our public debt ratings or, if we have not received public debt ratings, from 0.875% to 1.125%, depending on our Leverage Ratio, which is the ratio of indebtedness for borrowed money to Consolidated EBITDA, as defined in the Credit Agreement. Since issuance of the Term Loan, the Term Loan has been a Term Benchmark loan. The Credit Agreement contains customary affirmative and negative covenants as well as a financial covenant. We were in compliance with all debt covenants and representations of the Credit Agreement as of March 31, 2025.

Short-term Debt

As of each of March 31, 2025 and December 31, 2024, we had $33 million of short-term debt related to current maturities of our Term Loan.

Cognizant Technology Solutions			13			March 31, 2025 Form 10-Q

Long-term Debt

The following table summarizes the long-term debt balances as of:

(in millions)			March 31, 2025						December 31, 2024
Notes outstanding under revolving credit facility			$	—					$	300
Term Loan			602						610
Less:
Current maturities - Term Loan			(33)						(33)
Unamortized deferred financing costs			(2)						(2)
Long-term debt, net of current maturities			$	567					$	875

The carrying value of our debt approximated its fair value as of March 31, 2025 and December 31, 2024.

Note 6 — Income Taxes

Our effective income tax rates were as follows:

			Three Months Ended March 31,
			2025						2024
Effective income tax rate			24.4		%				24.8		%

We are involved in two separate ongoing disputes with the ITD in connection with previously disclosed share repurchase transactions undertaken by CTS India in 2013 and 2016 to repurchase shares from its shareholders (non-Indian Cognizant entities) valued at $523 million and $2.8 billion, respectively.

The 2016 transaction was undertaken pursuant to a plan approved by the High Court in Chennai, India, and resulted in the payment of $135 million in Indian income taxes - an amount we believe includes all the applicable taxes owed for this transaction under Indian law. In March 2018, the ITD asserted that it is owed an additional 33 billion Indian rupees ($386 million at the March 31, 2025 exchange rate) on the 2016 transaction. We deposited 5 billion Indian rupees, representing 15% of the disputed tax amount related to the 2016 transaction, with the ITD. Additionally, certain time deposits of CTS India were placed under lien in favor of the ITD, representing the remainder of the disputed tax amount.

In April 2020, we received a formal assessment from the ITD on the 2016 transaction, which is consistent with the ITD's previous assertions. Our appeal was ruled unfavorably by the CITA in March 2022 and by the ITAT in September 2023. We filed an appeal against the order of the ITAT with the High Court. On January 8, 2024, the SCI ruled that, in order to proceed with the appeal, we must deposit 30 billion Indian rupees, representing the time deposits of CTS India under lien, on the condition that, if CTS India prevails at the High Court, the amount deposited will be returned to CTS India, along with interest accrued, within four weeks of the judgment. We made the required deposit in January 2024 and the case is pending before the High Court.

As of March 31, 2025 and December 31, 2024, the deposit with the ITD was $404 million and $403 million, respectively, presented in "Other noncurrent assets".

The dispute in relation to the 2013 share repurchase transaction is also in litigation. At this time, the ITD has not made specific demands with regards to the 2013 transaction.

We continue to believe we have paid all applicable taxes owed on both the 2016 and the 2013 transactions and we continue to defend our positions with respect to both matters. Accordingly, we have not recorded any reserves for these matters as of March 31, 2025.

Cognizant Technology Solutions			14			March 31, 2025 Form 10-Q

Note 7 — Derivative Financial Instruments

In the normal course of business, we use foreign exchange forward and option contracts to manage foreign currency exchange rate risk. Derivatives may give rise to credit risk from the possible non-performance by counterparties. Credit risk is limited to the fair value of those contracts that are favorable to us. We have limited our credit risk by limiting the amount of credit exposure with any one financial institution and conducting ongoing evaluation of the creditworthiness of the financial institutions with which we do business. In addition, all the assets and liabilities related to the foreign exchange derivative contracts set forth in the table below are subject to master netting arrangements, such as the International Swaps and Derivatives Association Master Agreement, with each individual counterparty. These master netting arrangements generally provide for net settlement of all outstanding contracts with the counterparty in the case of an event of default or a termination event. We have presented all the assets and liabilities related to the foreign exchange derivative contracts, as applicable, on a gross basis, with no offsets, in our unaudited consolidated statements of financial position. There is no financial collateral (including cash collateral) posted or received by us related to the foreign exchange derivative contracts.

The following table provides information on the location and fair values of derivative financial instruments included in our unaudited consolidated statements of financial position as of:

(in millions)												March 31, 2025												December 31, 2024
Designation of Derivatives						Location on Statement of Financial Position						Assets						Liabilities						Assets						Liabilities
Foreign exchange forward and option contracts – Designated as cash flow hedging instruments						Other current assets						$	7					$	—					$	1					$	—
						Other noncurrent assets						6						—						—						—
						Accrued expenses and other current liabilities						—						7						—						22
						Other noncurrent liabilities						—						2						—						13
						Total						13						9						1						35
Foreign exchange forward contracts – Not designated as hedging instruments						Other current assets						2						—						1						—
						Accrued expenses and other current liabilities						—						2						—						2
						Total						2						2						1						2
Total												$	15					$	11					$	2					$	37

Cash Flow Hedges

We have entered and continue to enter into a series of foreign exchange derivative contracts that are designated as cash flow hedges of Indian rupee denominated payments in India. These contracts are intended to partially offset the impact of movement of the Indian rupee against the U.S. dollar on future operating costs and are scheduled to mature each month during the remainder of 2025, 2026 and the first three months of 2027. The changes in fair value of these contracts are initially reported in "Accumulated other comprehensive income (loss)" in our unaudited consolidated statements of financial position and are subsequently reclassified to earnings within "Cost of revenues" and "Selling, general and administrative expenses" in our unaudited consolidated statements of operations in the same period that the forecasted Indian rupee denominated payments are recorded in earnings. As of March 31, 2025, we estimate less than $1 million, net of tax, of net losses related to derivatives designated as cash flow hedges reported in "Accumulated other comprehensive income (loss)" in our unaudited consolidated statements of financial position is expected to be reclassified into earnings within the next 12 months.

Cognizant Technology Solutions			15			March 31, 2025 Form 10-Q

The notional value of the outstanding contracts by year of maturity was as follows:

(in millions)			March 31, 2025						December 31, 2024
2025			1,610						$	2,010
2026			1,175						920
2027			125						—
Total notional value of contracts outstanding (1)			$	2,910					$	2,930

(1)Includes $63 million notional value of option contracts as of March 31, 2025 with the remaining notional value related to forward contracts. There were no option contracts as of December 31, 2024.

The activity related to the change in net unrealized gains and losses on the cash flow hedges included in "Accumulated other comprehensive income (loss)" in our unaudited consolidated statements of stockholders' equity is presented in Note 9.

Other Derivatives

We use foreign exchange forward contracts to provide an economic hedge against balance sheet exposures to certain monetary assets and liabilities denominated in currencies other than the functional currency of our foreign subsidiaries. We entered into foreign exchange forward contracts that are scheduled to mature in the second quarter of 2025. Realized gains or losses and changes in the estimated fair value of these derivative financial instruments are recorded in the caption "Foreign currency exchange gains (losses), net" in our unaudited consolidated statements of operations.

Additional information related to the outstanding foreign exchange forward contracts not designated as hedging instruments was as follows:

(in millions)			March 31, 2025												December 31, 2024
			Notional						Fair Value						Notional						Fair Value
Contracts outstanding			$	801					$	—					$	489					$	(1)

The following table provides information on the location and amounts of realized and unrealized pre-tax gains and losses on the other derivative financial instruments for the three months ended March 31:

			Location of Net Gains (Losses) on Derivative Instruments						Amount of Net Gains (Losses) on Derivative Instruments
(in millions)									2025						2024
Foreign exchange forward contracts – Not designated as hedging instruments			Foreign currency exchange gains (losses), net						$	(1)					$	31

The related cash flow impacts of all the derivative activities are reflected as cash flows from operating activities.

Cognizant Technology Solutions			16			March 31, 2025 Form 10-Q

Note 8 — Fair Value Measurements

We measure our cash equivalents, certain investments, contingent consideration liabilities and foreign exchange forward and option contracts at fair value. Fair value is the exit price, or the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants as of the measurement date. The fair value hierarchy is based on inputs to valuation techniques that are used to measure fair value that are either observable or unobservable. Observable inputs reflect assumptions market participants would use in pricing an asset or liability based on market data obtained from independent sources while unobservable inputs reflect a reporting entity’s pricing based upon their own market assumptions.

The fair value hierarchy consists of the following three levels:

• Level 1 – Inputs are quoted prices in active markets for identical assets or liabilities.

• Level 2 – Inputs are quoted prices for similar assets or liabilities in an active market, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable and market-corroborated inputs which are derived principally from or corroborated by observable market data.

• Level 3 – Inputs are derived from valuation techniques in which one or more significant inputs or value drivers are unobservable.

The following table summarizes the financial assets and (liabilities) measured at fair value on a recurring basis as of March 31, 2025:

(in millions)			Level 1						Level 2						Level 3						Total
Cash equivalents:
Money market funds			$	29					$	—					$	—					$	29
Time deposits			—						794						—						794
Short-term investments:
Time deposits			—						1						—						1
Equity investment security			11						—						—						11
Other current assets:
Foreign exchange forward and option contracts			—						9						—						9
Other noncurrent assets:
Foreign exchange forward contracts			—						6						—						6
Accrued expenses and other current liabilities:
Foreign exchange forward contracts			—						(9)						—						(9)
Other noncurrent liabilities:
Foreign exchange forward contracts			—						(2)						—						(2)

Cognizant Technology Solutions			17			March 31, 2025 Form 10-Q

The following table summarizes the financial assets and (liabilities) measured at fair value on a recurring basis as of December 31, 2024:

(in millions)			Level 1						Level 2						Level 3						Total
Cash equivalents:
Money market funds			$	40					$	—					$	—					$	40
Time deposits			—						991						—						991
Short-term investments:
Time deposits			—						1						—						1
Equity investment security			11						—						—						11
Other current assets:
Foreign exchange forward contracts			—						2						—						2
Accrued expenses and other current liabilities:
Foreign exchange forward contracts			—						(24)						—						(24)
Other noncurrent liabilities:
Foreign exchange forward contracts			—						(13)						—						(13)

During the three months ended March 31, 2024, we made $30 million of payments related to Level 3 contingent consideration liabilities, which reduced the balance of these liabilities to zero. For the three months ended March 31, 2025, we did not have any Level 3 contingent consideration liabilities.

We measure the fair value of money market funds based on quoted prices in active markets for identical assets and measure the fair value of our equity investment security based on the published daily net asset value at which investors can freely subscribe to or redeem from the fund. The carrying value of the time deposits approximated fair value as of March 31, 2025 and December 31, 2024.

We estimate the fair value of each foreign exchange forward contract by using a present value of expected cash flows model. This model calculates the difference between the current market forward price and the contracted forward price for each foreign exchange forward contract and applies the difference in the rates to each outstanding contract. The market forward rates include a discount and credit risk factor. We estimate the fair value of each foreign exchange option contract by using a variant of the Black-Scholes model. This model uses present value techniques and reflects the time value and intrinsic value based on observable market rates.

During the three months ended March 31, 2025 and the year ended December 31, 2024, there were no transfers among Level 1, Level 2 or Level 3 financial assets and liabilities.

Cognizant Technology Solutions			18			March 31, 2025 Form 10-Q

Note 9 — Accumulated Other Comprehensive Income (Loss)

Changes in "Accumulated other comprehensive income (loss)" by component were as follows for the three months ended March 31, 2025:

(in millions)						Before Tax Amount						Tax Effect						Net of Tax Amount
Foreign currency translation adjustments:
Beginning balance						$	(261)					$	7					$	(254)
Change in foreign currency translation adjustments						97						6						103
Ending balance						$	(164)					$	13					$	(151)
Unrealized gains and losses on cash flow hedges:
Beginning balance						$	(34)					$	9					$	(25)
Unrealized gains arising during the period						30						(8)						22
Reclassifications of net losses to:
Cost of revenues						7						(2)						5
SG&A expenses						1						—						1
Net change						38						(10)						28
Ending balance						$	4					$	(1)					$	3
Losses on defined benefit plans:
Beginning balance						$	(20)					$	3					$	(17)
Losses on defined benefit plans						—						—						—
Ending balance						$	(20)					$	3					$	(17)
Accumulated other comprehensive income (loss):
Beginning balance						$	(315)					$	19					$	(296)
Other comprehensive income (loss)						135						(4)						131
Ending balance						$	(180)					$	15					$	(165)

Changes in "Accumulated other comprehensive income (loss)" by component were as follows for the three months ended March 31, 2024:

(in millions)						Before Tax Amount						Tax Effect						Net of Tax Amount
Foreign currency translation adjustments:
Beginning balance						$	(109)					$	5					$	(104)
Change in foreign currency translation adjustments						(74)						1						(73)
Ending balance						$	(183)					$	6					$	(177)
Unrealized gains and losses on cash flow hedges:
Beginning balance						$	13					$	(3)					$	10
Unrealized gains arising during the period						15						(4)						11
Ending balance						$	28					$	(7)					$	21
Accumulated other comprehensive income (loss):
Beginning balance						$	(96)					$	2					$	(94)
Other comprehensive income (loss)						(59)						(3)						(62)
Ending balance						$	(155)					$	(1)					$	(156)

Cognizant Technology Solutions			19			March 31, 2025 Form 10-Q

Note 10— Commitments and Contingencies

We are involved in various claims and legal proceedings arising in the ordinary course of business. We accrue a liability when a loss is considered probable and the amount can be reasonably estimated. When a material loss contingency is reasonably possible but not probable, we do not record a liability, but instead disclose the nature and the amount of the claim, and an estimate of the loss or range of loss, if such an estimate can be made. Legal fees are expensed as incurred. While we do not expect that the ultimate resolution of any existing claims and proceedings (other than the specific matters described below, if decided adversely), individually or in the aggregate, will have a material adverse effect on our financial position, an unfavorable outcome in some or all of these proceedings could have a material adverse impact on results of operations or cash flows for a particular period. This assessment is based on our current understanding of relevant facts and circumstances. As such, our view of these matters is subject to inherent uncertainties and may change in the future.

On January 15, 2015, Syntel sued TriZetto and Cognizant in the USDC-SDNY. Syntel’s complaint alleged breach of contract against TriZetto, and tortious interference and misappropriation of trade secrets against Cognizant and TriZetto, stemming from Cognizant’s hiring of certain former Syntel employees. Cognizant and TriZetto countersued on March 23, 2015, for breach of contract, misappropriation of trade secrets and tortious interference, based on Syntel’s misuse of TriZetto confidential information and abandonment of contractual obligations. Cognizant and TriZetto subsequently added federal DTSA and copyright infringement claims for Syntel’s misuse of TriZetto’s proprietary technology. The parties’ claims were narrowed by the court and the case was tried before a jury, which on October 27, 2020 returned a verdict in favor of Cognizant in the amount of $855 million, including $570 million in punitive damages. On April 20, 2021, the USDC-SDNY issued a post-trial order that, among other things, affirmed the jury’s award of $285 million in actual damages, but reduced the award of punitive damages from $570 million to $285 million, thereby reducing the overall damages award from $855 million to $570 million. The USDC-SDNY subsequently issued a final judgment consistent with the April 20th order. On May 26, 2021, Syntel filed a notice of appeal to the Second Circuit, and on June 3, 2021 the USDC-SDNY stayed execution of judgment pending appeal. On May 25, 2023, the Second Circuit issued an opinion affirming in part and vacating in part the judgment of the USDC-SDNY and remanding the case for further proceedings consistent with its opinion. The Second Circuit affirmed the judgment in all respects on liability but vacated the $570 million award that had been based on avoided development costs under the DTSA, and it remanded the case to the USDC-SDNY for further evaluation of damages. On June 23, 2023, the Second Circuit issued its mandate returning the case to the USDC-SDNY. On March 13, 2024, the USDC-SDNY issued a ruling that vacates the alternate compensatory damages awards that were within the scope of the Second Circuit’s remand and awards TriZetto and Cognizant approximately $15 million in attorney’s fees. On October 23, 2024, the USDC-SDNY granted TriZetto and Cognizant’s motion for a new trial on the amount of compensatory damages owed to TriZetto and Cognizant. On November 12, 2024, the USDC-SDNY scheduled the trial for June 16, 2025. On November 13, 2024, the USDC-SDNY granted Syntel’s request to certify for interlocutory appeal the question of whether the Second Circuit’s mandate permits the USDC-SDNY’s October 23rd order for a new trial on compensatory damages. The parties subsequently completed briefing at the Second Circuit regarding whether the Second Circuit should take up the interlocutory appeal, and on March 7, 2025, the Second Circuit denied Syntel’s request for an interlocutory appeal. On April 9, 2025, the USDC-SDNY rescheduled the trial to begin June 24, 2025. TriZetto and Cognizant will continue to vigorously pursue our claims against Syntel. We will not record any gain in our financial statements until it becomes realizable.

On February 28, 2019, a ruling of the SCI interpreting the India Defined Contribution Obligation altered historical understandings of the obligation, extending it to cover additional portions of the employee’s income. As a result, the ongoing contributions of our affected employees and the Company were required to be increased. In the first quarter of 2019, we accrued $117 million with respect to prior periods, assuming retroactive application of the SCI’s ruling, in "Selling, general and administrative expenses" in our unaudited consolidated statement of operations. There is significant uncertainty as to how the liability should be calculated as it is impacted by multiple variables, including the period of assessment, the application with respect to certain current and former employees and whether interest and penalties may be assessed. Since the ruling, a variety of trade associations and industry groups have advocated to the Indian government, highlighting the harm to the information technology sector, other industries and job growth in India that would result from a retroactive application of the ruling. It is possible the Indian government will review the matter and there is a substantial question as to whether the Indian government will apply the SCI’s ruling on a retroactive basis. As such, the ultimate amount of our obligation may be materially different from the amount accrued.

On October 31, 2016, November 15, 2016 and November 18, 2016, three putative shareholder derivative complaints were filed in New Jersey Superior Court, Bergen County, naming us, all of our then current directors and certain of our current and former officers at that time as defendants. These actions were consolidated in an order dated January 24, 2017. The complaints assert claims for breach of fiduciary duty, corporate waste, unjust enrichment, abuse of control, mismanagement, and/or insider selling by defendants. On April 26, 2017, the New Jersey Superior Court deferred further proceedings by dismissing the

Cognizant Technology Solutions			20			March 31, 2025 Form 10-Q

consolidated putative shareholder derivative litigation without prejudice but permitting the parties to file a motion to vacate the dismissal in the future.

On February 22, 2017, April 7, 2017, May 10, 2017 and March 11, 2019, four additional putative shareholder derivative complaints were filed in the USDC-NJ, naming us and certain of our current and former directors and officers at that time as defendants. These actions were consolidated in an order dated May 14, 2019. On August 3, 2020, lead plaintiffs filed a consolidated amended complaint. The consolidated amended complaint asserts claims similar to those in the previously-filed putative shareholder derivative actions. On February 14, 2022, we and certain of our current and former directors and officers moved to dismiss the consolidated amended complaint. On September 27, 2022, the USDC-NJ granted those motions and dismissed the consolidated amended complaint in its entirety with prejudice. Plaintiffs filed a notice of appeal on October 27, 2022. On May 3, 2024, the Third Circuit affirmed the dismissal of the consolidated amended complaint.

On June 1, 2021, an eighth putative shareholder derivative complaint was filed in the USDC-NJ, naming us and certain of our current and former directors and officers at that time as defendants. The complaint asserts claims similar to those in the previously-filed putative shareholder derivative actions. On March 31, 2022, we and certain of our current and former directors and officers moved to dismiss the complaint. On November 30, 2022, the USDC-NJ denied without prejudice those motions. The USDC-NJ ordered the parties to conduct limited discovery related to the issue of whether our board of directors wrongfully refused the plaintiff’s earlier litigation demand and, after the conclusion of such limited discovery, to file targeted motions for summary judgment on the issue of wrongful refusal.

We are presently unable to predict the duration, scope or result of the single putative shareholder derivative action that has not been dismissed. Although the Company continues to defend that putative shareholder derivative action vigorously, it is subject to inherent uncertainties, the actual cost of such litigation will depend upon many unknown factors and the outcome of the litigation is necessarily uncertain.

We have indemnification and expense advancement obligations pursuant to our bylaws and indemnification agreements with respect to certain current and former members of senior management and the Company’s board of directors. In connection with the matters that were the subject of our previously disclosed internal investigation, the DOJ and SEC investigations and the related litigation, we have received requests under such indemnification agreements and our bylaws to provide funds for legal fees and other expenses. There are no amounts remaining available to us under applicable insurance policies for our ongoing indemnification and advancement obligations with respect to certain of our current and former officers and directors or incremental legal fees and other expenses related to the above matters.

See Note 6 for information relating to the ITD Dispute.

On September 18, 2017, three former employees filed suit against Cognizant in the USDC-CDCA, alleging that they and similarly situated employees suffered disparate treatment on the basis of race in violation of 42 U.S.C. § 1981. Plaintiffs subsequently amended their complaint three times, adding a fourth former employee plaintiff and claims for both disparate treatment and disparate impact on the basis of race and national origin under Title VII and disparate treatment and disparate impact on the basis of race and national origin under Title VII. Plaintiffs filed the operative Third Amended Complaint-Corrected on January 19, 2021. Cognizant filed its answer on January 29, 2021.

On May 13, 2022, plaintiffs filed a motion requesting that the USDC-CDCA certify the case as a class action for two putative classes of plaintiffs consisting of: (1) all individuals who are not of South Asian race or Indian national origin who applied to Cognizant in the U.S. and were not hired since September 2013 (the “hiring class”); and (2) all individuals who are not of South Asian race or Indian national origin who have been terminated in the U.S. since September 2013 (the “terminations class”). Cognizant opposed. On October 27, 2022, the court denied certification for the hiring class and the terminations class. However, the court granted certification for a sub-set of the terminations class limited to approximately 2,300 former employees whose employment had been terminated from the “bench,” a designation for employees who are not allocated to an active project. On November 10, 2022, Cognizant filed a petition with the Ninth Circuit requesting permission to appeal the class certification order as to the bench terminations class. The Ninth Circuit denied the petition on January 26, 2023.

From June 13, 2023 to June 26, 2023, the USDC-CDCA held a class action jury trial on the first phase of plaintiffs’ Section 1981 claim and Title VII disparate treatment claim. The questions presented were whether Cognizant engaged in a pattern or practice of discrimination against non-South Asian and non-Indian employees with respect to bench terminations, and if so, whether punitive damages are available for class members who prevail on their claims. The jury deadlocked, and the court declared a mistrial.

The case proceeded to a retrial on September 24, 2024, and on October 4, 2024, the jury returned a verdict in favor of plaintiffs. The case will now proceed to the second phase to determine individualized liability and damages, if any, for each

Cognizant Technology Solutions			21			March 31, 2025 Form 10-Q

class member. As a result of the verdict, each non-South Asian and non-Indian class member who pursues claims in the second phase will be entitled to a rebuttable presumption that all termination decisions were discriminatory and to the possibility of recovering punitive damages if they prevail. The USDC-CDCA will also consider plaintiffs’ claim that Cognizant policies had a disparate impact on non-South Asian and non-Indian employees. We believe that class certification was improper, and that the second phase of the case will confirm that individualized issues should have precluded class certification. Cognizant will continue to vigorously defend itself in the second phase of this case and to pursue all available appellate arguments concerning class certification and the September 24, 2024 trial at the appropriate time. Because we cannot predict the number of individual plaintiffs who will proceed to the second phase, or the outcome of those cases, and in view of the appellate arguments regarding class certification, we are unable to reasonably estimate a possible loss or range of loss. We have not recorded any accruals related to this matter.

Many of our engagements involve projects that are critical to the operations of our clients’ business and provide benefits that are difficult to quantify. Any failure in a client’s systems or our failure to meet our contractual obligations to our clients, including any breach involving a client’s confidential information or sensitive data, or our obligations under applicable laws or regulations could result in a claim for substantial damages against us, regardless of our responsibility for such failure. Although we attempt to contractually limit our liability for damages arising from negligent acts, errors, mistakes, or omissions in rendering our services, there can be no assurance that the limitations of liability set forth in our contracts will be enforceable in all instances or will otherwise protect us from liability for damages. Although we have general liability insurance coverage, including coverage for errors or omissions, we retain a significant portion of risk through our insurance deductibles and there can be no assurance that such coverage will cover all types of claims, continue to be available on reasonable terms or will be available in sufficient amounts to cover one or more large claims, or that the insurer will not disclaim coverage as to any future claim. The successful assertion of one or more large claims against us that exceed or are not covered by our insurance coverage or changes in our insurance policies, including premium increases or the imposition of large deductible or co-insurance requirements, could have a material adverse effect on our business, results of operations, financial position and cash flows for a particular period.

In the normal course of business and in conjunction with certain client engagements, we have entered into contractual arrangements through which we may be obligated to indemnify clients or other parties with whom we conduct business with respect to certain matters. These arrangements can include provisions whereby we agree to hold the indemnified party and certain of their affiliated entities harmless with respect to third-party claims related to such matters as our breach of certain representations or covenants, our intellectual property infringement, our gross negligence or willful misconduct or certain other claims made against certain parties. Payments by us under any of these arrangements are generally conditioned on the client making a claim and providing us with full control over the defense and settlement of such claim. It is not possible to determine the maximum potential liability under these indemnification agreements due to the unique facts and circumstances involved in each particular agreement. Historically, we have not made material payments under these indemnification agreements and therefore they have not had a material impact on our operating results, financial position, or cash flows. However, if events arise requiring us to make payment for indemnification claims under our indemnification obligations in contracts we have entered, such payments could have a material adverse effect on our business, results of operations, financial position and cash flows for a particular period.

Note 11 — Segment Information

Our chief executive officer is our chief operating decision maker. Our CODM regularly reviews the performance of our business by four industry-based operating segments, which are our four reportable business segments: Health Sciences, Financial Services, Products and Resources, and Communications, Media and Technology.

We have an industry-led go-to-market strategy, with client partners, account executives and client relationship managers aligned to the specific industries they serve. Our CODM is regularly provided segment revenues and operating profit, including budget‑to‑actual variances in segment revenue, to formulate industry-focused strategic priorities, allocate financial resources, set targets and key performance indicators, and evaluate the results of such strategies. These strategic priorities, targets and key performance indicators are translated and applied to each client account, rolling up to respective industry-based operating segments. Our hiring and deployment plans are devised according to the strategic priorities and targets set for the client accounts.

Revenue from a client is directly identified with the operating segment with which the client is most closely aligned. Generally, operating expenses for each operating segment have similar characteristics and are subject to the same factors, pressures and challenges. However, the economic environment and its effects on industries served by the operating segments may affect revenues and operating expenses to differing degrees. Segment operating profit is the income from operations before unallocated costs.

Cognizant Technology Solutions			22			March 31, 2025 Form 10-Q

In the first quarter of 2025, we made certain changes to the internal measurement of segment operating profit for the purpose of evaluating segment performance and resource allocation. The primary reason for the change was to reflect a more complete cost of delivery. Specifically, segment operating profit now includes an allocation of certain corporate costs, which were previously included in "unallocated costs." We have reported 2025 segment operating profits using the new allocation methodology and have recast the 2024 results to conform to the new methodology.

Our CODM is not regularly provided with segment expenses. A portion of depreciation and amortization, certain corporate costs, the impact of the settlements of the cash flow hedges, the gain on the sale of property and equipment and expenses related to our NextGen program are not allocated to individual segments. Accordingly, such expenses are excluded from segment operating profit and are included below as “unallocated costs” and adjusted against our total income from operations.

We do not disclose assets by segment as a significant portion of the assets is used interchangeably among the segments and our CODM is not provided such information.

Information by reportable segment were as follows:

			Three Months Ended March 31, 2025
(in millions)			HS						FS						P&R						CMT						Total
Revenues			$	1,571					$	1,462					$	1,278					$	804					$	5,115
Less: other segment items			1,265						1,208						1,073						712						4,258
Segment operating profit			306						254						205						92						857
Less: unallocated costs																											4
Income from operations																											$	853

			Three Months Ended March 31, 2024
(in millions)			HS						FS						P&R						CMT						Total
Revenues			$	1,416					$	1,385					$	1,133					$	826					$	4,760
Less: other segment items			1,154						1,177						952						736						4,019
Segment operating profit			262						208						181						90						741
Less: unallocated costs																											46
Income from operations																											$	695

Other segment items for each reportable segment primarily include employee compensation and benefits, subcontractor costs, costs of third-party products and services related to revenue and project-related travel.

Geographic Area Information

Long-lived assets by geographic area are as follows:

			As of
(in millions)			March 31, 2025						December 31, 2024
Long-lived Assets: (1)
North America(2)			$	327					$	338
Europe			73						72
Rest of World (3)			588						584
Total			$	988					$	994

(1)Long-lived assets include property and equipment, net of accumulated depreciation and amortization.

(2)Substantially all relates to the United States.

(3)Substantially all relates to India.

Cognizant Technology Solutions			23			March 31, 2025 Form 10-Q

Note 12 — Subsequent Events

Dividend

On April 29, 2025, the Board of Directors approved the Company's declaration of a $0.31 per share dividend with a record date of May 19, 2025 and a payment date of May 28, 2025.

Cognizant Technology Solutions			24			March 31, 2025 Form 10-Q