As a result of these or other factors, it is possible that in some future periods, our revenues and results of operations may be significantly below the expectations of public market analysts and investors. In such an event, the price of our common stock would likely be materially and adversely affected.

The informationmarkets for technology, consultingdigital and business processoutsourcing services markets are characterized by rapid technological change, evolving industry standards, changing customer preferences and new product and service introductions. We are currently in the midst of a shift towards increasing customer demand for digital technologies and services. Our future success will depend on our ability to develop digital and other services and solutions that keep pace with changes in the markets in which we operate. We cannot be sure that we will be successful in developing digital and other new services and solutions addressing evolving technologies in a timely or cost-effective manner or that any services and solutions we do develop will be successful in the marketplace. Our failure to address the demands of the rapidly evolving technological environment could have a material adverse effect on our ability to retain and attract clientscustomers and on our competitive position, which could in turn have a material adverse effect on our business, results of operations and financial condition.

Our business depends, in part, upon continued growth in the use of technology in business by our clientscustomers and prospective clientscustomers as well as their customers and suppliers. In challenging economic environments, our clientscustomers may reduce or defer their spending on new technologies in order to focus on other priorities, or may choose to use their own internal resources rather than engage an outside firm to perform the types of services and solutions we provide. In addition, many companies have already invested substantial resources in their current means of conducting commerce and exchanging information, and they may be reluctantunwilling or slow to adopt new approaches that could disrupt existing personnel, processes and infrastructures. If the growth of technology usage in business, or our clients’customers’ spending on technology, in business, declines, or if we cannot convince our clientscustomers or potential clientscustomers to embrace new technological solutions, our business, results of operations and financial condition could be adversely affected.

Consistent with industry practice, most of our contracts with our customers are short-term. A majority of our contracts can be terminated by our clientscustomers with short notice and without significant early termination cost. Terminations may occur as a result of, among other things, any failure on our part to satisfy our contractual commitments or more broadly satisfy our customers’ expectations with respect to the services we provide. Our customers may also decide at any time to switch to a different provider or undertake the work themselves due to cost or other considerations. Terminations may also result from factors that are beyond our control and unrelated to our work product or the progress of the project, including the business or financial condition of a client,customer, changes in ownership, management or the strategy of a clientcustomer or economic or market conditions generally or specific to a client’scustomer’s industry. When contracts are terminated, we lose the anticipated revenues and might not be able to eliminate our associated costs in a timely manner. Consequently, our operating margins in subsequent periods could be lower than expected. If we are unable to replace the lost revenuerevenues with other work on terms we find acceptable or effectively eliminate costs, our business, results of operations and financial condition could be adversely affected.

We negotiate pricing terms with our clientscustomers utilizing a range of pricing structures and conditions. We predominantly contract to provide services either on a time-and-materials basis, or on a fixed-price basis. Fixed-price contracts accounted for approximately 36.5% of our revenues for the year ended December 31, 2015, and we expect that an increasing number of our future projects will be contracted on a fixed-pricebasis or volume basis. Our pricing is highly dependent on our internal forecasts and predictions about our projects and the marketplace, which might be based on limited data and could turn out to be inaccurate. We face a number of risks when pricing our contracts as many of our projects entail the coordination of operations and workforces in multiple locations and utilizing workforces with different skill sets and competencies across geographically diverse service locations. Our pricing, cost and operating margin estimates for the work that we perform frequently include anticipated long-term cost savings from transformational and other initiatives that we expect to achieve and sustain over the life

Further, we are required to integrate any acquired businesses into our system of disclosure controls and procedures and internal control over financial reporting. Companies we acquire, prior to being acquired by us, may not be required to implement or maintain the disclosure controls and procedures or internal control over financial reporting that are required of public companies, prior to being acquired by us and wecompanies. We cannot provide assurance as to how long the integration process may take.

Internal control over financial reporting has inherent limitations, including human error and the possibility that controls could be circumvented or becomebe inadequate because of changed conditions andor fraud. If we are unable to maintain effective internal controls, we may not have adequate, accurate or timely financial information, and we may be unable to meet our reporting obligations as a publicly traded company or comply with the requirements of the SEC or the Sarbanes-Oxley Act of 2002. This could result in a restatement of our financial statements, the imposition of sanctions, or investigation by regulatory authorities, and could cause investors to lose confidence in our reported financial information. Any such consequence or other negative effect ofresulting from our inability to meet our reporting requirements or comply with legal and regulatory requirements, as well as any disclosure of an accounting, reporting or control issue, could adversely affect the trading price of our common stock and our business.

If we are unable to complete acquisitions of the number, magnitude and kind of acquisitions for whichnature we plan,have targeted, or if we are inefficient or unsuccessful at integrating any acquired businesses including TriZetto, into our operations, we may not be able to achieve our planned rates of growth or improve our market share, profitability or competitive position in specific markets or services. The process of acquiring and integrating an acquireda company, business, or technology has created, and will continue to create, operating difficulties. The risks we face include:

Although we conduct due diligence in connection with each of our acquisitions, there may be liabilities that we fail to discover, that we inadequately assess or that are not properly disclosed to us.us, that we fail to discover or that we inadequately or incorrectly assess. In particular, to the extent that any acquired business (or any assets thereof) (i) failed to comply with or otherwise violated applicable laws or regulations, (ii) failed to fulfill contractual obligations to customers or (iii) incurred material liabilities or obligations to customers that are not identified during the diligence process, we, as the successor owner, may be financially responsible for these violations, failures and liabilities and may suffer financial and/or reputational harm or otherwise be adversely affected. In addition, as part of an acquisition, we may assume responsibilities and obligations of the acquired business pursuant to the terms and conditions of agreements entered into by the acquired entity that are not consistent with the terms and conditions that we typically accept and require. We also have been and may in the future be subject to litigation or other claims in connection with an acquired company,business, including claims from terminated employees, customers, former stockholders, or other third parties. Any material liabilities associated with our acquisitions could harm our business, results of operations and financial condition.

To deliver our services and solutions to our customers, we must maintain arely upon high speed network ofnetworks, including satellite, fiber optic and land lines andoperated by third parties, to provide active voice and data communications 24 hours aper day between our main operating offices in India, our other development andglobal delivery centers, and the offices of our customers and our associates worldwide. Any systems failure or outage or a significant disruption in our ability to transmit voice and data through satellite and telephonesuch communications or in our information technology systems and infrastructure could result in curtailed operations, and a loss of customers and reputational damage, which would have an adverse effect on our business, results of operations and financial condition.

Our future performance depends upon the continued service of the key members of our management team. Competition for experienced executive officers and other key employees in the industries in which we compete is intense, and there can be no assurance that we will be able to retain key persons, or that we will be successful in attracting and retaining replacements in the future. The loss of any one or more of our executive officers or significant employees, or the failure to attract, integrate and retain additional talent, could have a material adverse effect on our business, results of operations and financial condition. We do not maintain key man life insurance on any of our executive officers or significant employees.

In addition, our business could be harmed if any key member of our management team leaves our employment and joins one of our competitors. Currently, we have entered into non-competition agreements with the majoritymost of our executive officers. We cannot be certain, however, that the restrictions in these agreements prohibiting such executive officers from engaging in competitive activities arewould be enforceable. Any defection by a key member of our management team could have a material adverse effect on our business, results of operations and financial condition.

If we fail to meet our contractual obligations or otherwise breach obligations to our clients,customers, we could be subject to legal liability. We may enter into non-standard agreements because we perceive an important financial opportunity by doing so or because our personnel did not adequately adhere to our guidelines. In addition, the contracting practices of our competitors may cause contract terms and conditions that are unfavorable to us to become standard in the marketplace. If we cannot, or do not, meet our contractual obligations to provide services and solutions, and if our exposure is not adequately limited through the enforceable terms of our agreements, we might face significant legal liability and our business, results of operations and financial condition could be adversely affected.

In the normal course of business and in conjunction with certain clientcustomer engagements, we have entered into contractual arrangements through which we may be obligated to indemnify clientscustomers 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 harmlessprovide indemnification with respect to third-party claims, including matters such as our breach of certain representations or covenants, our infringement of the intellectual property of others, our violation of laws or our gross negligence or willful misconduct. Payments by us under any of these arrangements are generally conditioned on the clientcustomer making a claim and providing us with full control over the defense and settlement of such claim. It is not possible to determine our maximum potential exposure under these indemnification agreementsarrangements due to the unique facts and circumstances involved in each

Additionally, our clientscustomers may perform audits or require us to perform audits and provide audit reports with respect to the controls and procedures that we use in the performance of services for such clients,customers, especially when we process data belonging to them. Our ability to acquire new clientscustomers and retain existing clientscustomers may be adversely affected and our reputation could be harmed if we receive a qualified opinion, or if we cannot obtain an unqualified opinion in a timely manner, with respect to our controls and procedures in connection with any such audit in a timely manner.audit. We could also incur liability if our controls and procedures, or the controls and procedures we manage for a client,customer, were to result in an internal control failure or impair our client’scustomer’s ability to comply with its own internal control requirements.

The increased breadth of our service and solution offerings has resulted and may continue to result in larger and more complex projects with our clients.customers. This requires us to establish closer relationships with our clientscustomers and achieve a thorough understanding of their operations. Our ability to establish such relationships depends on a number of factors, including the proficiency of our professionals and our management personnel. Our failure to understand our clientcustomer requirements or our failure to deliver services and solutions that meet the requirements specified by our clientscustomers could result in termination of clientcustomer contracts and we could be liable to our clientspotential liability for significant penalties or damages, any of which could have a material adverse effect on our business, results of operations and financial condition.

Larger projects often involve multiple engagements or stages, and there is a risk that a clientcustomer may choose not to retain us for additionallater stages or may cancel or delay additional planned engagements. These terminations, cancellations or delays may result from factors that have little or nothing to do with the quality of our services, such as the business or financial condition of our clients or the economy generally. Such cancellations or delays make it difficult to plan for project resource requirements and inaccuracies in such resource planning and allocation may have a negative impact on our business, results of operations and financial condition.

Our business depends on our ability to successfully obtain payment from our clients of the amounts they owe uscustomers for work performed. We evaluate the financial condition of our clientscustomers and usually bill and collect on relatively short cycles. There is no guarantee that we will accurately assess the creditworthiness of our customers. We maintain allowances against receivablestrade accounts receivable and unbilled services.accounts receivable. Actual losses on clientcustomer balances could differ from those that we currently anticipate and, as a result, we might need to adjust our allowances. There is no guarantee that we will accurately assess the creditworthiness of our clients. Macroeconomic conditions could also result in financial difficulties for our clients,customers, including limited access to the credit markets, insolvency or bankruptcy, and, as a result, could cause clientscustomers to delay payments to us, request modifications to their payment arrangements that could increase our receivables balance, or default on their payment obligations to us. Timely collection of clientcustomer balances also depends on our ability to complete our contractual commitments and bill and collect our contracted revenues.fees. If we do work for a customer but are nevertheless unable to meet our contractual requirements,commitments, we mightmay not be entitled to collect for our work or may collect reduced amounts and/or experience delays in collection of and/collection. Any delay or be unableinability to collect from our client balances, and if this occurs, our results of operations and cash flows could be adversely affected. In addition, if we experience an increase in the time to bill and collectcustomers for our services, our cash flows could bework may adversely affected.

Certain of our software products contain components that are developed by third parties. In addition, we resell certain software products of third parties and we use third-party software products to deliver our services and solutions. We may not be able to replace the functions provided by these third-party software components or products if they become obsolete, defective, or incompatible with future versions of our products or with our services and solutions, or if they are not adequately maintained or updated. Any defects in or significant interruption in the availability of these third-party software products or components could harm the sale of our products and our delivery of services and solutions to our clientscustomers unless and until we can secure or develop an alternative source. If we fail to comply with the license terms applicable to third party software, we could be liable to the owners of the software for damages. In addition, third-party suppliers of software or other intellectual property assets could be unwilling to permit us to use or to continue to use their intellectual property and this could impede or disrupt use of their products or services by usour customers and our clients.us. If our ability to provide services and solutions to our clientscustomers is impaired as a result of any such denial, our business, results of operations and financial condition could be adversely affected.

Any deterioration of the credit and capital markets in the United States, Europe or other regions of the world could result in volatility of our investment earnings and impairments to our investment portfolio, which could negatively impact our financial condition and reported income. Any declineChanges in economic activityconditions could adversely affect the ability of counterparties, including counterparties to use certain financial instruments such as marketable securities and derivativesour foreign exchange forward contracts, to meet their obligations to us.

During the year ended December 31, 2015,2017, we earned approximately 40.3%38.1% of our revenues from theour financial services industry,business segment, which includes banking and insurance customers, and 29.5%28.8% from theour healthcare industry.business segment, which includes healthcare and life sciences customers. Significant consolidation or a decrease in growth in the financial services industry or the healthcare industry may reduce the demand for our services and negatively affect our business, financial condition and results of operations. For example, two or more of our current clientscustomers may merge or consolidate and combine their operations, which may cause us to lose work or lose the opportunity to gain additional work. The increased market power of larger companies may also increase pricingcompetitive and competitivepricing pressures on us. Any of these possible results of industry consolidation could adversely affect our business, financial condition and results of operations.operations and financial condition. In addition, if we are unable to successfully anticipate changing regulatory, economic and political conditions affecting the industries in which we operate, we may be unable to effectively plan for or respond to those changes, and our business, results of operations and financial condition could be negatively affected.

Approximately 78.6% of our revenues duringDuring the year ended December 31, 20152017, 77.3% of our revenues were derived from clientscustomers located in North America. In the same period, approximatelyAmerica and 16.2% of our revenues were derived from clientscustomers located in Europe. Any weakening of economic conditions in the United StatesU.S. or European economies could depress the pricing for our services and cause our customers to reduce or postpone their technology spending, significantly, which may in turn lower the demand for our services and negatively affect our business, results of operations and financial condition.

Our recenthistoric and anticipated growth including our acquisition of TriZetto, will continue to place significant demands on our management and other resources, and will require us to continue to develop and improve our operational, financial and other internal controls. In particular, our growth has presented and will increase thecontinue to present challenges involved in:with respect to:

In addition, the increasing size and scope of our operations increase the possibility that a member of our personnel will engage in unlawful or fraudulent activity, breach our contractual obligations, or otherwise expose us to unacceptable business risks, despite our efforts to train our people and maintain internal controls to prevent such instances. If we do not continue to develop and implement the right processes and tools to manage our enterprise, our business, results of operations and financial condition could be adversely affected.

In addition,February 2017 we announced a plan to return $3.4 billion to stockholders by the credit agreement contains certain covenantsend of 2018 through a combination of stock repurchases and cash dividends. As part of this plan, we have undertaken accelerated stock repurchase programs to repurchase a total of $1.8 billion of our Class A common stock and paid $265 million for dividends in 2017. Following the passage of the Tax Cuts and Jobs Act, or the Tax Reform Act, and due in part to the benefits we expect to receive under such act, in February 2018 we announced an increase in our quarterly dividend and have indicated that our Board of Directors intends to continue to review the capital return plan for potential future increases, subject to our financial performance, economic outlook and any other relevant considerations.

The Board of Directors’ determinations regarding dividends and share repurchases will depend on a variety of factors, including a requirementamount and location of our cash and investment balances, net income, cash flow generated from operations, overall liquidity position and potential alternative uses of cash, such as acquisitions, as well as economic conditions and expected future financial results. There can be no guarantee that we maintain a debt to total stockholders' equity ratio not in excess of 0.40 to 1.00 as of the last day of any fiscal quarter. Failure to comply with this covenant or other provisions of the credit agreement could result in a default under the credit agreement, requiring us to either cure such default, receive a waiver, orwill achieve our announced capital return plan in the absence of such cureamounts or waiver, refinance any outstanding indebtedness underwithin the credit agreement. There is no assuranceexpected time frame that we wouldhave indicated, or at all. Our ability to declare future dividends will depend on our future financial performance, which in turn depends on the successful implementation of our strategy and on financial, competitive, regulatory, technical and other factors, general economic conditions, demand and prices for our services and other factors specific to our industry or specific projects, many of which are beyond our control. Therefore, our ability to generate cash flow depends on the performance of our operations and could be ablelimited by decreases in our profitability or increases in costs, regulatory changes, capital expenditures or debt servicing requirements.

Any failure to refinanceachieve our debt on acceptable termsannounced capital return plan could negatively impact our reputation, harm investor confidence in us, and conditions.cause the market price of our common stock to decline.

We have offices and operations in various countries around the world and provide services to clientscustomers globally. In 2015, approximately 78.6%2017, 77.3% of our revenues were attributable to the North American region, 16.2% were attributable to the European region, and the remainder was attributable to the rest of the world, primarily the Asia Pacific region.Pacific. We anticipate that revenues from customers outside North America will continue to account for a material portion of our revenues in the

Although we report our operating results in U.S. dollars, a portion of our revenues and expenses are denominated in currencies other than the U.S. dollar. Fluctuations in foreign currency exchange rates can have a number of adverse effects on us. Because our consolidated financial statements are presented in U.S. dollars, we must translate revenues, expenses and income, as well as assets and liabilities, into U.S. dollars at exchange rates in effect during or at the end of each reporting period. Therefore, changes in the value of the U.S. dollar against other currencies will affect our revenues, income from operations, net income and the value of balance sheet items originally denominated in other currencies. There is no guarantee that our financial results will not be adversely affected by currency exchange rate fluctuations. In addition, in some countries we could be subject to strict restrictions on the movement of cash and the exchange of foreign currencies, which could limit our ability to use these funds across our global operations. Further, as we continue to leverage our global delivery model, morea portion of our expenses areis incurred in currencies other than those in which we bill for the related services. An increase in the value of certain currencies, such as the Indian rupee, against the U.S. dollar could increase costs for delivery of services at offshore sites by increasing labor and other costs that are denominated in local currency.

We have entered into a series of foreign exchange forward contracts that are designated as cash flow hedges of certain rupee denominated payments in India. These contracts are intended to partially offset the impact of the movement of the exchange rates on future operating costs. In addition, we have also entered into foreign exchange forward contracts in order to

Because we provide services to clientscustomers throughout the world, we are subject to numerous, and sometimes conflicting, legal rules on matters as diverse as import/export controls, content requirements, trade restrictions, tariffs, taxation, sanctions, government affairs, internal and disclosure control obligations, data privacy and labor relations. Violations of these laws or regulations in the conduct of our business could result in fines, criminal sanctions against us or our officers, prohibitions on doing business, damage to our reputation and other unintended consequences such as liability for monetary damages, fines and/or criminal prosecution, unfavorable publicity, restrictions on our ability to process information and allegations by our clientscustomers that we have not performed our contractual obligations. Due to the varying degrees of development of the legal systems of the countries in which we operate, local laws might be insufficient to protect our rights. Our failure to comply with applicable legal and regulatory requirements could have a material adverse effect on our business, results of operations and financial condition.

Among other anti-corruption laws and regulations, we are subject to the United States Foreign Corrupt Practices Act, or FCPA, which prohibits improper payments or offers of improper payments to foreign officials to obtain business or any other benefit, and the U.K. Bribery Act. Violations of these laws or regulations could subject us to criminal or civil enforcement actions, including fines and suspension or disqualification from government contracting or contracting with private entities in certain highly regulated industries, any of which could have a material adverse effect on our business, results of operations and financial condition.

Hostilities involving acts of terrorism, violence or war, natural disasters, global health risks or pandemics or the threat or perceived potential for these events could materially adversely affect our operations and our ability to provide services to our customers. Such events may cause customers to delay their decisions on spending for information technology, consulting, and business process services and give rise to sudden significant changes in regional and global economic conditions and cycles. These events also pose significant risks to our personnel and to our and our clients’customers’ physical facilities and operations around the world. Additionally, by disrupting communications and travel, giving rise to travel restrictions, and increasing the difficulty of obtaining and retaining highly-skilled and qualified personnel, these events could make it difficult or impossible for us to deliver services to some or all of our clients.customers. The majority of our employees are located in India, and the vast majority of our technical professionals in the United States and Europe are Indian nationals who are able to work in the United States and Europe only because they hold currentcurrently valid visas and work permits. Any inability to travel could cause us to incur additional unexpected costs and expenses or could impair our ability to retain the skilled professionals we need for our operations. In addition, any extended disruptions of electricity, other public utilities or network services at our facilities could also adversely affect our ability to serve our clients.customers.

Hostilities involving the United States, the United Kingdom, India and other countries in which we provide services to our clients, and othercustomers, as well as acts of terrorism, violence or war, natural disasters, global health risks or pandemics may reduce the demand for our services and negatively affect our revenues. If we fail to defend against any of these occurrences, we might be unable to protect our people, facilities and systems. If these disruptions prevent us from effectively serving our clients,customers, our business, results of operations and financial condition could be adversely affected.

We earn a significant amount of our earnings outside of the United States. Other than amounts for which we have already accrued U.S. taxes, wein India and consider foreignIndian accumulated undistributed earnings to be indefinitely reinvested outside of the United States.reinvested. While we have no plans to do so, events may occur that could effectively force us to change our intent not to repatriate such earnings. If suchAs a result of the Tax Reform Act, U.S. federal taxes have been provisionally accrued on these earnings, as well as other non-U.S. earnings, as of December 31, 2017 as part of the one-time transition tax. However, if we were to change our assertion that our accumulated undistributed Indian earnings are repatriated in the future or are no longer deemed to be indefinitely reinvested, outsidewe would expect, based on our current interpretation of the United States, or if legislation is enacted in the United States providing for aIndian tax on foreign earnings or profits prior to their repatriation, we may havelaw, to accrue taxes associated with such earnings or profitsadditional tax expense at a substantially higher rate of approximately 21% of cash available for distribution, which could have a material adverse effect on our business, results of operations and financial condition. This estimate is subject to change based on tax legislative developments in India and other jurisdictions as well as judicial and interpretive developments of applicable tax laws.

Our Indian subsidiaries, collectively referred to as Cognizant India, are primarily export-oriented and are eligible for certain income tax holiday benefits granted by the Indian government for export activities conducted within Special Economic Zones, or SEZs, for periods of up to 15 years. Recently, theThe Indian government has announced a proposal which includes, among other items, phasingplan to phase out of certain tax exemptions and deductions, which includes a discontinuation of tax holidayholidays for new SEZsSEZ units commencing activity fromoperations on or after April 1, 2017, and a phased reduction of the current Indian corporate income tax rate. If enacted, these2020. These changes or any changes that would reduce or deny SEZ tax benefits could have a material adverse effect on our business, results of operations and financial condition. In addition, all Indian profits, including those generated within SEZs, are subject to the Minimum Alternative Tax, or MAT, at the rate of 21.3%. Any MAT paid is creditable against future corporate income tax, subject to limitations. Currently, we anticipate utilizing our existing MAT balances against future corporate income tax. Our ability to fully do so may be influenced by possible changes to the Indian tax laws as well as the future financial results of Cognizant India. Our potential inability to fully utilize our deferred income tax assets related to the MAT could have a material adverse effect on our business, results of operations and financial condition.

Our stock has at times experienced substantial price volatility as a result of variations between our actual and anticipated financial results, announcements by us and our competitors, projections or speculation about our business or that of our competitors by the media or investment analysts or uncertainty about current global economic conditions. The stock market, as a whole, also has experienced extreme price and volume fluctuations that have affected the market price of many technology companies in ways that may have been unrelated to these companies’ operating performance. Furthermore, we believe our stock price should reflect future growth and profitability expectations and, if we fail to meet these expectations, our stock price may significantly decline.

Provisions in our charter and by-laws, each as amended, and Delaware General Corporate Law, or DGCL, may have the effect of deterring unsolicited takeover proposals or delaying or preventing changes in our control or management, including transactions in which stockholders might otherwise receive a premium for their shares over then-current market prices. These provisions include:

These provisions could also discourage bids for our common stock at a premium as well as create a depressive effect on the market price of the shares of our common stock.