David Nelson - Vice President of Investor Relations and Treasurer Francisco D'Souza - Chief Executive Officer and Director Gordon J. Coburn - President Karen McLoughlin - Chief Financial Officer and Principal Accounting Officer

Bryan Keane - Deutsche Bank AG, Research Division Sara Gubins - BofA Merrill Lynch, Research Division Julio C. Quinteros - Goldman Sachs Group Inc., Research Division Tien-Tsin T. Huang - JP Morgan Chase & Co, Research Division Ashwin Shirvaikar - Citigroup Inc, Research Division James E. Friedman - Susquehanna Financial Group, LLLP, Research Division Darrin D. Peller - Barclays Capital, Research Division Edward S. Caso - Wells Fargo Securities, LLC, Research Division Rod Bourgeois - Sanford C. Bernstein & Co., LLC., Research Division Georgios Mihalos - Crédit Suisse AG, Research Division Glenn Greene - Oppenheimer & Co. Inc., Research Division Rayna Kumar - Evercore Partners Inc., Research Division Kathryn L. Huberty - Morgan Stanley, Research Division Jason Kupferberg - Jefferies LLC, Research Division Steven Milunovich - UBS Investment Bank, Research Division Moshe Katri - Cowen and Company, LLC, Research Division Joseph D. Foresi - Janney Montgomery Scott LLC, Research Division Keith F. Bachman - BMO Capital Markets U.S. David J. Koning - Robert W. Baird & Co. Incorporated, Research Division Arvind A. Ramnani - BNP Paribas, Research Division

Ladies and gentlemen, welcome to the Cognizant Technology Solutions Second Quarter 2013 Earnings Conference Call. [Operator Instructions] Thank you. I would now like to turn the conference over to David Nelson, Vice President, Investor Relations and Treasurer at Cognizant. Please go ahead, sir.

Thank you, operator, and good morning, everyone. By now you should have received a copy of the earnings release for the company's second quarter 2013 results. If you have not, a copy is available on our website, cognizant.com. The speakers we have for today's call are Francisco D'Souza, Chief Executive Officer; Gordon Coburn, President; and Karen McLoughlin, Chief Financial Officer. Before we begin, I would like to remind you that some of the comments made on today's call and some of the responses to your questions may contain forward-looking statements. These statements are subject to the risks and uncertainties as described in the company's earnings release and other filings with the SEC. I would now like to turn the call over to Francisco D'Souza. Francisco, please go ahead. Francisco D'Souza: Thank you, David, and good morning, everyone. Thanks for joining us today. Cognizant's second quarter performance was strong and ahead of our guidance for the quarter. Second quarter revenue was $2.16 billion, a sequential increase of 7% and an increase of 20.4% year-over-year. Our non-GAAP operating margin was above the top end of our target range at 21.4% for the quarter. This was primarily due to the weakness of the Indian rupee, the timing of wage increases in the year and higher utilization. Based on our strong growth this quarter and our expectation of continued healthy demand environment for the rest of the year, we've increased full year revenue guidance by $140 million to $8.74 billion, which represents at least 19% year-over-year growth. I'm pleased with our strong growth this quarter. We added more incremental revenue this quarter than all but one other quarter in our history. I'd like to comment on some of the drivers of this quarter's performance before I turn the call over to Gordon and Karen for the operating and financial details. During the quarter, we celebrated the 15th anniversary of Cognizant's IPO on the NASDAQ stock exchange. While much has changed at Cognizant during that time, one thing that remains absolutely consistent is our strategy of reinvestment in the business to drive top line growth. During these 15 years, we have maintained stable operating margins and delivered industry-leading revenue growth. In recent years, we have focused our investment across 3 growth horizons. We implemented these 3 Horizon approach in response to a fundamental long-term shift we identified in our clients' business imperatives. We think of these imperatives in terms of a dual mandate: run better and run different. As a reminder, run better is when we help clients drive greater performance in their current business, and run different is when we help clients improve the positioning of their businesses for future success. On our call last quarter, I went into some details outlining our Horizon 3 portfolio. I spoke to you about our progress in building out our capabilities in the SMAC technologies: social, mobile, analytics and cloud. We continue to see strong evidence that SMAC is the next secular shift in computing, and we are investing accordingly. And we had some great client wins across our SMAC practices. For instance, we recently engaged with a global consumer goods company to build a Center of Excellence for social media analytics, which will enable them to derive actionable insights from the data gleaned from a variety of social media sources. As enterprises around the world focus on digital transformation of their operations, and SMAC becomes ever more prevalent in the industry nomenclature, we have seen that our early lead and our thought leadership in this area gives us a distinct competitive advantage in the market. And while I'm pleased with the investments we have made in SMAC as a driver of growth, I'm also pleased with the healthy growth in our Horizon 1 and Horizon 2 services, which Gordon will talk about shortly. The growth in these services is important because it demonstrates our continued success in enabling clients who have to increasingly run better in order to free up investments for run different initiatives. I'm confident that Cognizant has more class offerings on both dimensions of the dual mandate. As we look to the remainder of the year, we see a continuation of the healthy demand environment for our services, which gives us the confidence to raise guidance for the full year. The demand comes from a combination of macro trends and our own competitive positioning. On the macro front, in North America, our largest geographic market, as consumer and business confidence continued to show modest improvements, our clients are starting to turn their attention to making investments in software and services. Often, these investments are funded through modest budget increases, but more often, the funding comes from driving efficiency in other parts of the business. And in Europe, which represents the majority of the remainder of our business, as the macro environment in many countries continues to be challenging, we are finding an increased appetite from clients to move more work to a global delivery model. Let me end my remarks by saying that I think our strong performance is a testament to the strategy we have been implementing and discussing with you in recent quarters. I believe that we're extremely well positioned and I am encouraged about our prospects for the remainder of the year. Now I'll hand it over to Gordon to share more about our performance, and to Karen to provide more financial details. I'll return to the conversation for Q&A. Gordon? Gordon J. Coburn: Thank you, Francisco. We had another solid quarter with demand across our industries, geographies and service lines generally playing out better than anticipated, driven in part by strong discretionary spend. Our Horizon 1 services performed very well, with particular strength in consulting and technology services. This is in line with what we see in a normal budget and spend cycle, where we see the full-quarter impact of the current year's budgeted discretionary spend kick in during the second quarter. The strong growth in our Horizon 1 services is a further validation of our balanced approach to growing and integrating our core services with our emerging services and new service offerings. For example, we saw this reflected in the performance of our quality engineering and assurance practice, which performed exceptionally well this past quarter. Today, this practice has over 20,000 career testers providing a wide range of testing services across all 3 Horizons of our business, including in newer and rapidly growing areas such as testing for regulatory compliance, testing of mobile applications, product testing and testing consulting and advisory services. As a market leader in this service offering, we are seeing strong interest by clients in utilizing our testing services and IP through newer business models such as managed services. Turning to Horizon 2 offerings. On a combined basis, our Horizon 2 services continued to grow faster than company average, driving both mind share and market share. Cognizant Business Consulting, or CBC, continues to lead the charge for many of the transformational deals we win. During the quarter, several key wins were a result of CBC being an integral part of our pursuit in helping us present a transformational roadmap to our clients. It is important to note that these consulting-led transformational deals cut across our Horizon 1, Horizon 2 and Horizon 3 businesses. Our vertically aligned BPO practice continues to show solid growth, supported by expansion of work with existing clients and recent wins with new clients. With every passing quarter, we continue to expand our capabilities in vertically aligned BPO. This quarter, for example, we saw some good wins around provider credentialing, health exchanges, asset management and banking reconciliation. Additionally, we continue to expand and strengthen our U.S. delivery and operations capabilities to support our BPO services. As part of this effort, we recently completed a tuck-under acquisition of SourceNet Solutions, an accounts payable service provider located at College Station, Texas, which was owned by our long-time financial services client, BNY Mellon. This acquisition brings SourceNet's processing platform to Cognizant. IT Infrastructure Services continued to see robust growth across industries and geographies. As indicated in the previous quarter, we continue to see more deals integrating applications and infrastructure and delivering significant value to clients from their synergies. During the quarter, we won several large deals, some of them being end-to-end, multi-year IT Infrastructure deals that included data center migration, provisioning and support leveraging our recently added data centers. One good example is a deal with Orkla, the Nordics' leading supplier of branded consumer goods. Under a 5-year agreement, Cognizant will provide a broad range of applications and end-to-end infrastructure management services to Orkla, delivering a more stable and scalable technology environment, improving service quality, predictability, flexibility and business agility. Looking at our performance from an industry standpoint, financial services continued to perform well during the second quarter, growing over 6% sequentially and 24% year-over-year. Within banking, among both our larger and midsized clients, demand continues to be driven by ongoing cost optimization, a steady pickup in regulatory and risk management projects and the growing importance of mobility and analytics. Healthcare, which consists primarily of our payer and pharmaceutical clients, grew 6% sequentially at about 12% year-over-year. While we expect the growth of our pharmaceutical business to remain slower than company average, given the industry's ongoing challenges with patent expirations, the work with our payer clients is beginning to rebound. The growth in the payer sector is broad-based among many of our larger clients. In particular, we are executing a number of consulting, program management, IT and BPOs assignments, assisting clients with the participation in the new health insurance exchanges. Our retail manufacturing sector, which had another strong quarter, growing 8% sequentially and 29% year-over-year. Within retail, the strength of our consulting and program management capabilities, coupled with our deep industry knowledge, is enabling us to win a number of strategic deals. During the quarter, we were selected to implement a supply chain initiative for a major retailer, and we continue to expand the number of clients that we serve as their e-commerce partner. Our Other segment grew 8% sequentially and 15% year-over-year. Within the telecom portion of the segment, we saw broad-based growth and project ramps across a number of our key accounts. We also saw strong sequential growth in the high-tech portion of the segment, resulting from strong discretionary spend, as this area is more heavily weighted towards development work. Moving on to our performance by geography. North America grew 6% sequentially and 17% year-over-year. Europe saw healthy growth at 11% sequential and 37% year-over-year. Breaking down the European performance: U.K. grew 8% sequentially and 28% year-over-year; including the impact of the C1 Group acquisition, Continental Europe grew almost 16% sequentially and 54% year-over-year. Excluding the revenue from the C1 Group, growth in Continental Europe was approximately 6% sequentially. Last quarter, we spoke to you about the acquisition of the 6 companies of the C1 Group with strong presence in Germany. Integration is progressing well. We are jointly going to market with a broader and deeper set of capabilities and stronger local presence. Within a short period of time since we closed this acquisition at the start of March, we have jointly won several new logos and have expanded our capabilities with existing customers in Germany and Switzerland. As discussed earlier, we are seeing a structural shift to long-term outsourcing deals across Europe with the economic climate serving as a catalyst. Because of our continued investments in Europe, local leadership and broad range of capabilities, we remain optimistic in our long-term growth prospects across Europe. Our growth in the rest of the world continued to remain strong, growing 7% sequentially and 25% year-over-year, as our investments in key markets such as Singapore, India and the Middle East are continuing to drive accelerated growth. I'd now like to quickly touch base on the status of immigration reform. As many of you know, and as expected, a comprehensive immigration reform bill was passed by the Senate in late June. Our view of the bill remains unchanged. The bill includes some very good things for the American economy, our customers and our industry, but also include several clauses which, if enacted, would be detrimental to our clients and U.S. competitiveness. Now that the Senate has passed this bill, the immigration debate shifts to the House of Representatives. The House leadership has clearly stated that it does not intend to consider the Senate's bill. Rather, it will follow a different approach and develop its own legislation through a step-by-step approach. It is unclear whether the approach in the House will result in a bill as comprehensive as the Senate's or several separate bills addressing targeted components of immigration. In late June, a High-Skilled Immigration bill was passed by the House Judiciary Committee. This proposal includes many of the positive components of the Senate bill, such as increasing Visa caps and streamlining the Green Card process. However, it did not include the onerous outplacement clause found in the Senate's bill. It is clear that we are still in the early days of the House's discussion of immigration. In addition, we were pleased to see the Indian government raise the potential impact of the Senate's H-1B provisions on the U.S.-India relationship and the India government's understanding of the concerns of the U.S. Government and U.S. technology companies regarding certain of its policies and the flexibility that the Indian government has shown on these issues. On the client side, we are seeing no change in client behavior as a result of the immigration debate. We are discussing the issue with clients and other stakeholders who are interested, though such requests have been few and far between. Finally, let me comment on our attrition during the second quarter. Annualized attrition was 18.7%. We calculate attrition by annualizing the turnover which occurred within the quarter, including both voluntary and involuntary. Our attrition statistics include all departures, including BPO and employees in our training program. Although we often see a sequential increase in attrition during the second quarter, this year's increase was a bit higher than normal. Our attrition was heavily weighted towards our junior staff offshore and it was impacted by the timing of our 2012 bonus payments, as well as the completion of our 2012 performance evaluation process. Although attrition increase was not entirely unexpected, we're certainly paying attention to this uptick. In addition to the compensation increases and promotions that took effect July 1, we are also making it very clear to our associates, both in our employee communications and also in our actions, that Cognizant's strong growth creates tremendous career opportunities for each of them. I'll now hand the call over to Karen to comment on our financial performance and guidance.

Thank you, Gordon, and good morning to everyone. As detailed in our press release, our second quarter revenue grew 7% sequentially and 20.4% over last year to $2.16 billion, ahead of our guidance of $2.13 billion from last quarter. Our non-GAAP operating margin, which excludes stock-based compensation expense and acquisition-related expenses, was 21.4%, above our target range of 19% to 20%, while our GAAP operating margin was 19.7% for the quarter. We generated $1.07 of non-GAAP EPS and $0.99 of GAAP EPS for the quarter. Both GAAP and non-GAAP EPS included $0.07 of nonoperating FX losses for the quarter. As Frank mentioned, the over performance in non-GAAP operating margin was primarily the result of increased utilization during the quarter, the impact of the rupee depreciation net of our hedge losses and the timing of compensation increases and promotions which took effect on July 1. Our GAAP tax rate for the second quarter was 28.5%. Our tax rate for the quarter and expected rate for the full year is higher than our previous guidance, due primarily to additional tax expense in India related to the impact of foreign exchange movements on certain USD-denominated assets of our Indian subsidiaries. Now turning to some of our other performance measures. Consulting and technology services, formerly known as application development, represented 50.5% of revenue; and outsourcing services, formerly known as application management, was 49.5% for the quarter. Consulting and technology services grew 17.8% year-over-year and 8.7% sequentially. Outsourcing services grew 23.1% year-over-year and 5.3% sequentially. 32.4% of our revenue came from fixed-price contracts during the second quarter and grew by 5.4% sequentially and 16.9% year-over-year. As expected, on a sequential basis, our pricing was stable during the second quarter. We closed the quarter with 1,100 active customers and the number of accounts which we consider to be strategic increased by 8. This brings our total number of strategic clients to 229. We continue to see a trend towards our newer strategic customers embracing a wider range of Cognizant services at an earlier stage in the relationship. Our fully diluted share count for the quarter was 304.4 million shares, a decrease of approximately 730,000 shares from Q1. During the second quarter, we repurchased approximately 1.83 million shares at an average price of $62.94 for a total cost of approximately $115 million. To date, 15.7 million shares at a cost of $998 million have been repurchased under the current share repurchase authorization of $1.5 billion. Turning to the balance sheet. Our balance sheet remains very healthy. We finished the second quarter with approximately $2.9 billion of cash and short-term investments, up by approximately $156 million from March 31. During the second quarter, operating activities generated approximately $365.6 million of cash. Financing activities consumed approximately $106.3 million of cash. This was comprised of expenditures of $115 million towards our share repurchase program, offset by net proceeds of $8.9 million related to option exercises and related tax benefits, as well as our employee stock purchase program. We spent approximately $50.3 million for capital expenditures during the quarter and during 2013, we continue to expect our capital expenditures to total approximately $400 million. Based on our $1.79 billion receivable balance on June 30, we finished the quarter with a DSO, including unbilled receivables, of 75 days, down by 1 day from the first quarter. The unbilled portion of our receivables balance was approximately $224 million, up from $206 million at the end of Q1. Approximately 63% of the Q2 unbilled balance was billed in July. Net headcount increased by approximately 1,600 people during the quarter, 48% of gross additions for the quarter were direct college hires, while 52% were lateral hires of experienced professionals. We ended the quarter with approximately 164,300 employees globally, of which approximately 152,700 were service delivery staff. Utilization increased on a sequential basis during Q2. Offshore utilization was approximately 70%. Offshore utilization, excluding recent college graduates who are in our training program, was approximately 75%. And on-site utilization increased to approximately 93% during the quarter. I would now like to comment on our growth expectations for the third quarter of 2013, as well as the full year. For the fourth -- for the third quarter of 2013, we are projecting revenue of at least $2.25 billion. For the full year 2013, we expect to continue delivering industry-leading revenue growth. Based on current conditions and client indications, we are pleased to revise our revenue guidance upwards to at least $8.74 billion. This represents full year growth of at least 19%. This guidance includes $10 million of expected revenue from the recently closed tuck-under acquisition of SourceNet Solutions. During Q3 and for the full year 2013, we expect to operate within our target non-GAAP operating margin range of 19% to 20%. Therefore, we are currently comfortable with our ability to deliver in Q3 non-GAAP EPS of $1.09, which translates to GAAP EPS of $1. This guidance anticipates a Q3 share count of approximately 305 million shares and a tax rate of approximately 27%. Our guidance excludes any nonoperating FX gains or losses. For the full year 2013, we expect our non-GAAP EPS to be at least $4.32, excluding estimated stock-based compensation expense of $0.31 and acquisition-related expenses of $0.05, our GAAP EPS will be at least $3.96. This guidance anticipates a full year share count of approximately 305 million shares and a tax rate of approximately 27%. It also excludes any further nonoperating FX gains or losses. Now we would like to open the call for questions. Operator?

[Operator Instructions] Our first question comes from the line of Bryan Keane with Deutsche Bank. Bryan Keane - Deutsche Bank AG, Research Division: Just a real quick question. Normally, 2Q and 3Q sequential growth are pretty similar in terms of revenue, but it looks like even backing out the SourceNet acquisition, you're expecting a softer sequential revenue growth from the spike of, looks like about 6% organic in 2Q. I guess, just anything behind that or is that just conservatism? And just related to that, the headcount growth wasn't as high as we expected sequentially. Should we expect a spike back up in headcount growth? And was that just impacted by the attrition rate? Gordon J. Coburn: Bryan, it's Gordon. Q2 generally should be our strongest quarter sequentially, and the reason why is Q1 tends to be muted because you don't get a whole lot of discretionary spend in the first half of the quarter. So in Q2, you get the full-quarter impact of the new budget cycle and then, obviously, that continues in Q3 but you don't get as big a sequential boost. And that is more pronounced in the years where discretionary spending is the driver of growth, which obviously, it is this year. Headcount is playing out exactly as we want it, we're actually very pleased. If you'll recall, we hired a lot of people at the end of last year to set ourselves up well for growth this year. Took utilization down a bit in Q1 and then, clearly, we said we wanted to take utilization back up and that's exactly what we did. So we have great control over our hiring and we are executing on our plan of taking utilization up as the year goes on. We don't give specific hiring targets for the remainder of the year, but certainly, we would -- we think there is a little bit more room for utilization, though Q2 was -- saw the big jump in utilization.

Our next question is from the line of Sara Gubins with Bank of America Merrill Lynch. Sara Gubins - BofA Merrill Lynch, Research Division: I'm wondering for immigration reform, if you're seeing any discussion with clients about it, if there are any delays in their decision making or the kinds of questions that they are asking? And also, you've talked about clients being ready to lobby on your behalf. Has that begun now that the Senate bill is passed? Gordon J. Coburn: Sure, Sara. So with clients -- first of all, let me be very clear about this, there has been absolutely no change, whatsoever, in decision-making as a result of immigration. The number of questions that we've gotten from -- received from clients have been few and far between. Where clients ask questions, we've been going out and meeting with them. But the number of questions have been quite small, and the discussion is more around, "Hey, how do you think legislation will play out?" And typically, in those discussions will come up, are there things that -- the customers says, we as a company can do. Generally, the CIO won't have the authorization to go do it themselves, but what we're seeing, they're certainly hoping to reach out to their Washington offices. Clients are getting involved, some directly and some through trade organizations. But it's a fairly small number, which is appropriate at this time, the -- what's wise for key ones to voice their opinion.

Your next question is from the line of Julio Quinteros, Goldman Sachs. Julio C. Quinteros - Goldman Sachs Group Inc., Research Division: Gordon, just one real quick one, just to clean up the acquisition contributions for the quarter and for the year. I thought I heard both the C1 and SourceNet -- but I think when you guys said a $10 million acquisition, that was only for SourceNet. Can you just help us clean that up a little bit to know what the sort of acquired contributions are expected to be from, I guess, both C1 and SourceNet and then, just the organic implication underneath that?

Sure, Julio, this is Karen. So -- think about there's 3 pieces. There's C1 and MediCall acquisitions, which we talked about back in Q1. Those are still on track to do about $90 million of incremental revenue for the year... Gordon J. Coburn: And those were in our guidance.

And that was in our original guidance. The only change this quarter is the addition of SourceNet, which is $10 million of incremental revenue for the year.

Our next question is coming from the line of Tien-Tsin Huang of JPMorgan. Tien-Tsin T. Huang - JP Morgan Chase & Co, Research Division: I just wanted to ask about SG&A, it was surprisingly low, looks like only up 6% year-on-year. Can you break that down for us, what's sort of depressing the growth rate there? Gordon J. Coburn: Tien-Tsin, SG&A will bounce around a bit. In the end, we target an operating margin, as we always have -- this quarter, we came in a little bit high but obviously, it will come down into the range next quarter as wage inflation kicks in. And so depending on where cost of goods land. Now -- but remember, what's -- part of what's happening here is we're growing. And as we grow, there is more leverage of SG&A. So I would not read a whole lot into quarter-to-quarter movements in SG&A.

Our next question is from the line of Ashwin Shirvaikar with Citigroup. Ashwin Shirvaikar - Citigroup Inc, Research Division: I know you guys do sometimes 2 sets of rate increases, 1 in May and 1 in July. Was there a shift in relative importance you give to the May 1 versus the July 1 this year? Gordon J. Coburn: We simplified it this year. So last couple of years, we split -- part of the population was in May, part was in July. We simplified it this year, we moved everyone to a July cycle. So the ones that were in May are now in July, the ones that were in July continued to be in July.

The next question comes from the line of James Friedman of Susquehanna. James E. Friedman - Susquehanna Financial Group, LLLP, Research Division: Karen, with regard to the unusually high tax rate, 28.5%, I heard your commentary, but it sounded like in the instance that the rupee were to go the other way, would the tax reverse? And then, a follow-up related question, did you say you had $0.07 of hedge-related losses in the quarter?

Sure. So let me answer the first -- the second part of that first. So the $0.07 was the nonoperating FX losses for the quarter. So that was on the, essentially, on the INR-denominated -- the net asset position of the INR assets, okay, was the $0.07. Then separately, on the increase in the tax rate, that is due to the gains, essentially, in our India books on the U.S. dollar-denominated assets that are recorded in our India statutory book. So yes, if the rupee were to strengthen significantly, that would offset over time.

The next question is from the line of Darrin Peller with Barclays. Darrin D. Peller - Barclays Capital, Research Division: Just a question on the Healthcare vertical. After a few quarters in a row of seeing a little bit of weaker trend, obviously, it did show an acceleration quarter. I know I think, Gordon, you mentioned the paying side of it or the payer side of it. Can you just give us a little more color on that? I mean, is that something we can see as being sustainable? Obviously, that's one -- it's been, historically, one of your more important verticals and seeing strength in that is nice to see. Francisco D'Souza: It's Frank, Darrin. Yes, we're very pleased with the strength in Healthcare, overall, and a large part of it is driven by, we're seeing broad-based growth across our payer clients and that's really across a spectrum of services that we offer. So we've seen really good growth there in our consulting business, program management. We're starting to do a lot of IT and BPO stuff, assisting clients with participation in the new health insurance exchanges. So we're feeling very good about the payer side of that business. The other side of the Healthcare business is the Life Sciences business, and there, I think it's going to take us a few more quarters -- there's sort of a lingering pressure on Life Sciences clients who are dealing with the patent cliff. And so I think that, that will bottom out over the next 2 or 3 quarters and then, start to come back. So we're seeing good strong growth on the payer side, still some lingering pressure on the Life Sciences side, but overall, you saw a good quarter-on-quarter sequential growth, so we're feeling good about the overall business.

The next question is from the line of Edward Caso of Wells Fargo. Edward S. Caso - Wells Fargo Securities, LLC, Research Division: I wanted to talk about the infrastructure outsourcing business, if maybe you could frame the size of it as a percent of the total? What the competitive position outlook is right now? It seems like everyone is talking about it, they seem to be larger deals. So could you also talk about the margin profile relative to your average? Gordon J. Coburn: Ed, it's Gordon. So let me take the first part on size and then, I'll hand it over to Frank to talk about the market. Think about Horizon 2, BPO, infrastructure and CBC, all those we've now gotten to critical mass. Infrastructure -- all 3 together are over 20% of revenue. Infrastructure alone is now, in terms of people, is measured -- I think, we're approaching 14,000 people or so. So we're at critical mass in that business, which means we can start competing in bigger deals. And that's one of things that we're excited about because it gives us the credibility now to compete in the bigger deals too. Frank, do you want to talk a little bit about the market? Francisco D'Souza: I think, as Gordon said, we feel good about our competitive position at this point. Obviously, we're playing in the asset-light area of infrastructure management. We built a very strong, credible capability. Gordon, in his prepared comments, talked about the win up at Orkla, which is one example of a multi-year infrastructure deal. So -- and there are several such deals that we are competing on and winning. So as the market shifts more towards looking at infrastructure as a viable candidate to move to a global delivery model and in addition, as clients look to leverage the cloud increasingly and infrastructure in the cloud, that's driving a great deal of transformation in Infrastructure Services. We feel like we're very well positioned. In terms of margin profile on the business, we think that the margin profile in the business in the long run, it's very similar to the core business. We are investing in the business right now so our SG&A in that business is higher than what it will be in steady-state as a percent of revenue, and that's pulling margins down. But the fundamental of the business is such that we think in the long run, they will be very compatible to the core business.

The next question is from the line of Rod Bourgeois of Sanford Bernstein. Rod Bourgeois - Sanford C. Bernstein & Co., LLC., Research Division: So 2 topics. Can you just quantify how much margin boost you received in the quarter from the rupee depreciation, and then, what that might look like in the current quarter? And to what extent the move in the rupee is enabling you to invest at a more rapid rate than you would have assumed at the beginning of the year? And then just real quick, as a second topic, can you just give us thoughts on your assumptions in your guidance for the rest of the year concerning discretionary spending?

Sure. So Rod, I'll take the first part, then, I'll turn it over to Gordon for the second piece of that. Regarding the FX impact on a sequential basis, there's about 30 basis points of margin improvement because, obviously, we've hedged a lot of our rupee exposure. So net of the hedge losses, that's about 30 basis points. Going forward, think about it as about 10 basis points of margin improvement for every 1% movement in the rupee. Gordon J. Coburn: And on our assumptions about discretionary spending. As we said, we -- in the second quarter, we saw continued healthy demand for discretionary spending. We saw it start at the end of Q1, it clearly continued into Q2. And based on what customers are telling us, pipelines deals that are happening, we think that continues for the remainder of the year.

The next question is from the line of George Mihalos of Credit Suisse. Georgios Mihalos - Crédit Suisse AG, Research Division: Just as it relates to Horizon 2, can you kind of break out the growth rates or maybe give us a sense if consulting BPO and infrastructure management are growing in tandem or one is outperforming the other? And just as it relates to the U.K., can you talk a little about the strength that you saw there and was that all organic? Gordon J. Coburn: So when you think about Horizon 2, all 3 of them, overall, are growing faster than the company. Each quarter, one will grow a little bit faster than the other and so that's all small numbers. But think about all 3 of these, our businesses, as I had just mentioned, that now hit critical mass, can play in bigger deals. So we would expect sort of, on a normalized basis, all of them to grow faster than company average. Which one grows the fastest, that will -- quarter-on-quarter, that'll flip around a little bit. U.K. had no inorganic revenues, so that was all organic. Frank, do you want to just comment on the business environment in the U.K.? Francisco D'Souza: I think that for the last several quarters across Europe, both on the continent and in the U.K., the focus has been -- our clients' focus has been on the run better services. So focused a lot on optimization of existing operations and looking more work to the global delivery model. I would say, though, that in the last, perhaps, 1 quarter -- and I don't want to call it a trend yet, we have seen in the U.K., particularly some pickup in discretionary spending as well, where we see somewhat of an uptick in the U.K. on business confidence and consumer confidence. We're also starting to see an uptick in discretionary spending. A lot of that is focused on things like the SMAC stack. So clients looking at deploying social, mobile, analytics and cloud. We're also seeing things like omni-channel with our retail customers. So we are starting to see, in the U.K., some signs that discretionary spending starting to pick up. And of course, there continues to be a strong thrust both in the U.K. and in the continent towards the run better types of services -- excuse -- in the run better types of services.

The next question is from the line of Glenn Greene of Oppenheimer. Glenn Greene - Oppenheimer & Co. Inc., Research Division: Gordon, I just want to go back to sort of the discretionary spending comments, get a little bit more color there. Kind of, is it broad-based across verticals and geography? How much of the upside guide was due to this relative to market share gains? And kind of taking note of the 8 strategic ones in the quarter, it seems like the deal activity actually accelerated as well, maybe you could comment on that? Gordon J. Coburn: Sure. So I think the majority of the increase in guidance and overperformance in the quarter was a result of discretionary spend. Because coming out of Q1, we saw the early signs of a pickup in discretionary spend, but we weren't sure if it had legs. Clearly, it had legs, so we were a bit cautious on it early on, we saw it materialize in the second quarter. So I would really point to discretionary spend. What we referred to as the run different spend being the big driver of over performance in the quarter and for the full year. And then, obviously, from an industry standpoint, banking did very well. It's a big business and it did well. And the payer side of Healthcare did well as well, so we're certainly pleased and perhaps, a bit surprised on both of those.

The next question is from the line of David Togut of Evercore Partners. Rayna Kumar - Evercore Partners Inc., Research Division: This is Rayna Kumar for David Togut. Can you please quantify wage increases in the quarter? And separately, can you please discuss your current capital allocation priorities, including, if there's a possibility for an initiation of a dividend in the near term? Gordon J. Coburn: Sure. So on wages, as we mentioned, our annual increment, as well as our annual promotions all go into effect July 1, so there is no impact in the second quarter. Obviously, it impacts in the third quarter, and that's way we guided that we'd be back down into our normal operating range. On capital allocation, as Karen mentioned, we continued to repurchase shares during the quarter. As many know, we expanded our repurchase program earlier in the year, and we still have about $500 million left in that program. So the focus would be when and how do we continue to use that program.

Next question is from the line of Katy Huberty of Morgan Stanley. Kathryn L. Huberty - Morgan Stanley, Research Division: Just curious, when you think about getting back to the targeted non-GAAP operating margin range, what are the factors that get you there? In the third quarter, obviously, you have the salary bumps July 1, but do you also expect to step-up hiring as you go into the back-half the year? And then, maybe if you can just comment on the higher attrition, where do you think those junior workers are leaving Cognizant to go to? Gordon J. Coburn: Sure. So let me start with the first question on margin. The big driver is the salaries kick in. Obviously, we'll continue to hire, but revenues growing so that offset, so it's really -- the wage is just the big thing. And implied in that is we continued to invest during the second quarter -- I want to be very clear about that, our investment continued at a very healthy pace. Where do people go when they leave? They go to lots of places. The reality is, Cognizant has an incredible training program. Obviously, we're doing well in the marketplace, so our people are in demand. So we lose to various multinational competitors, to ISPs as well as once in a while, to other offshore companies. But I think what we see is -- and people understand, is when you grow faster, which we're doing, than the rest of the industry, does create unique career opportunities. And we see that, particularly, with our highest performers, where we see a very low attrition rate. So we're very pleased about that. So there's a pickup in attrition, but this has happened many times in the past, we know how to deal with it. So obviously, we got to make sure we take it back down to where we like but this is -- this has happened many times and it's normal course of business.

The next question is from the line of Jason Kupferberg with Jefferies and Company. Jason Kupferberg - Jefferies LLC, Research Division: Just a clarification and a question. A clarification on the tax rate, especially, as we start to think beyond this year, are we saying that the rupee would have to appreciate for the tax rate to come back towards the 25% range versus the 27% range? And then, just my question is, what percent of your new clients these days are initially engaging Cognizant in Horizon 2 or 3 rather than Horizon 1? And any comparison to what that percentage might have looked like a year or so ago?

Sure. So Jason, I'll take the first part of that and then, turn it over to Frank and Gordon for the second part. But on the tax rate, what's really causing that spike to the 27% is the volatility in the rupee. So if the rupee were to stabilize at this rate, over time, the rate would start to come back down. So we wouldn't have that big swing in the gain or loss on the U.S. dollar-denominated assets. So we do not view that this is a permanent adjustment to this tax rate, assuming that the rupee does start to stabilize over time. Francisco D'Souza: Jason, on the other part of your question -- it's Frank. I don't have a specific number, but my instinct thinks it's about -- it's been increasing in terms of the number of new clients that we're winning based on a Horizon 2 or Horizon 3 type of service. We're actually winning new clients now based on Horizon 3 services, clients that have never done business with Cognizant in the past. As a guess, without a specific number, I would say it's about 1/3 -- 25% to 1/3 of the clients -- the new clients that we're winning would be a Horizon 2 or Horizon 3 services. And that's up from, I would say, 2 or 3 years ago, that would have been in the low-single digits in terms of new clients for the company. So it's up quite considerably, and it's an indicator to me that, once again, that our -- those service lines are becoming competitive in their own right. And of course, we're having great success cross-selling into our existing client base and we're also doing very well selling those services to new clients.

The next question is from the line of Steve Milunovich of UBS. Steven Milunovich - UBS Investment Bank, Research Division: Given your success in run different this last quarter, do you raise your $500 million target for SMAC? And I guess, which parts of SMAC are you seeing the most interest in? Francisco D'Souza: I'll answer the second part first. The places where we're clearly seeing the most traction in SMAC are in the mobile space. There's just a tremendous amount of demand in mobility, that part of the SMAC business grew very nicely, sequentially. And more importantly, we're starting to see clients there where we are doing large ongoing platform mobility work. And a year or 2 ago, if we had looked at the mobile work we were doing, it would be small engagements in that space. So now we're starting to see a real significant client engagement in mobility. The next after that, I would say, would be analytics. And there is just a tremendous amount of interest in -- and opportunity to drive better business performance through Big Data and deep analysis. Cloud is a very significant part of our business but it's, in a sense, distributed across many areas of our business. So cloud shows up in our Infrastructure business, cloud shows up in our enterprise applications business. So it's very distributed across all of Cognizant. And so I would point to those 3 as being the places where we're seeing the most traction. And of course, social, I would say, to a lesser extent, that there continues to be some interest there as well, like the example I gave in my prepared comments. We don't update guidance on a service-by-service basis. We wanted to give you a sense last quarter of where we will land with SMAC this year. I still think $500 million is a pretty good number. Will it be a little higher than that? It could be based on the demand we're seeing. But I wouldn't want to update that on a quarter-by-quarter basis moving forward.

Our next question is from the line of Moshe Katri of Cowen. Moshe Katri - Cowen and Company, LLC, Research Division: Just a clarification, you've bumped up guidance by about 200 basis points for revenue growth, but then you bumped up the EPS guidance by $0.01 for the year. Maybe you can talk about that? I don't know if you did earlier on the call. And then, just another clarification here. We're focusing a lot about -- on net headcount additions for the quarter. In your view, given the fact that you're focusing a bit more on nonlinear growth, is this something we should continue to focus on as a proxy for top line growth or maybe, the effect of net headcount additions will probably not be as relevant down the road? Gordon J. Coburn: Moshe, it's Gordon. On EPS, that's entirely due to the nonoperating FX loss this quarter. We actually beat earnings this quarter by $0.07 more than reported because our guidance always excludes nonoperating losses. So the reason you're not seeing as much EPS flow through to the full year as revenue is due to that $0.07 FX loss that we experienced -- nonoperating FX loss that we experienced during the quarter. The net headcount additions, I'd always be very careful on focusing on that, that's why we stopped giving guidance because there's a lot of seasonality for when we bring people on, when we want to take utilization up and down. For instance, late last year we decided to bring on a bunch of people, consciously took utilization down in Q1 and starting to take it back up now. So I think you ought to always want to be fairly careful about that. I'm not sure the nonlinear stuff is materially moving the needle at this point, on headcount additions because you also have BPO growing, which takes it in the opposite direction. So that's more of just utilization management.

Your next question is from the line of Joseph Foresi of Janney Montgomery Scott. Joseph D. Foresi - Janney Montgomery Scott LLC, Research Division: Would you describe the recovery as balanced or are there pockets of strength and weakness? And then, maybe you could give us a little bit more color on the financial services vertical. Have you seen a pickup in discretionary spending there, particularly in capital markets or consulting? Francisco D'Souza: Yes, I would say -- Joe, it's Frank. I would say that in the U.S., I would call the recovery fairly balanced. We are seeing it across almost all of the industry sectors that we -- in which we operate. So the U.S., I think, we're seeing good broad-based growth in discretionary spending. The only place, as I've mentioned a little earlier in the call, that I think there's some lingering weakness is in our life sciences business. We talked to you about that last quarter as well, but besides that, we feel very good about the U.S. market. As we look at Europe, I think the continent continues to be a story of different countries and different stories in the different countries. But there, we're seeing more of a focus on cost containment and driving greater efficiencies, so sort of the run better part of our business. And in the U.K., a little bit of a mixed bag. I would say, broad-based growth but not as strong as it is in the U.S. So a little bit in the middle. So overall, I think that's the picture. And sorry, Joe, what was the second part of your question? I apologize. Joseph D. Foresi - Janney Montgomery Scott LLC, Research Division: I just wanted to know about financial services, a pickup, particularly, in capital markets. Maybe you can just give us a breakdown of demand within that vertical? Francisco D'Souza: Yes. So we're -- so again, as Gordon said, we were a little surprised when financial services came back -- in the last 2 quarters, we've been surprised as to the positive side in both quarters. This quarter, we had good sequential growth there. The demand is coming from retail, it is coming from capital markets. Retail banking, and as we've said in the last few -- 2 or 3 quarters, we've also started to see nice pickup with the midsized banks in the U.S. as they start to adopt the global delivery model. In capital markets, some of our growth now is being driven by a pickup in regulatory and risk management-related projects. And that often does include a consulting and, sort of, strategy and consulting fees upfront.

The next question is from the line of Keith Bachman of BMO Capital Markets. Keith F. Bachman - BMO Capital Markets U.S.: Two, if I could. If you think about last year this at time, you're guiding to 20% year-over-year growth, and now you're guiding to, call it, 19% year-over-year growth. Would you -- could you characterize the visibility relative to those benchmarks that you currently have in terms of pipeline and deal flow to the 19% growth this year versus where you stood last year? And then, secondly, could you also just talk about cash flow targets for the year? For instance last year, you delivered about 16% of revenue was cash flow from operations. Would you anticipate about the same level of performance this year? Gordon J. Coburn: Keith, it's Gordon. Let me take the first part and then, Karen will take the second. So we just increased our guidance to 19%, given it's mid-August, and in our business, you have to ramp up the people and so forth. We have pretty good visibility on the remainder of the year. So I would say, our visibility is similar to what it was this time last year. The time when you have less visibility is in February, before people lock down their budgets. But by this time of year, people -- you have the natural flow. Obviously, you can have new deals come in and that kind of stuff, but you don't have the macro surprises -- that's all tied out at this point. And obviously, that's why we're pleased that we're able to raise our guidance. Let me have Karen comment on cash flow.

Sure. So we actually don't provide cash flow guidance for a number of reasons, but -- including, we don't know the timing of acquisitions, what we might do under the stock buyback program and so forth. So I think we would expect to continue to show strong cash flow from operations as we go into the back half of the year. And we'll continue to invest in capital expenditures, as we talked about. And then, when appropriate, utilize the stock buyback program and do acquisitions as appropriate.

Our next question is from the line of Dave Koning of Robert W. Baird. David J. Koning - Robert W. Baird & Co. Incorporated, Research Division: Just one quick one. You said $10 million of revs from the SourceNet acquisition in the back half. Is that about $5 million a quarter? I'm just wondering as to the timing of when it got done, just so we correctly model quarter-by-quarter.

Yes, so the acquisition closed beginning of June, end of May, and that's spread pretty evenly over the year.

Our next question is from the line of Arvind Ramnani of BNP Paribas. Arvind A. Ramnani - BNP Paribas, Research Division: Just 2 quick questions. Your Q4 guidance implies only about 2.6% sequential growth. What assumptions have you made in -- changed like somewhere in the guidance? And the second question is related to the Immigration Bill. I agree with your earlier comments that buyers of IT services are not worried about the Immigration Bill. However, have you all made any changes to your recruiting efforts and is there any medium- to long-term plan to reduce dependency on H-1Bs? Gordon J. Coburn: Sure, this is Gordon. Let me quickly just set the Q4 guidance and discuss immigration. Q4, that's a quarter where you never quite know, is there a budget slash? Do people run out of budget? As you get to the year -- so you always want to leave a little bit of breathing room there. And historically, Q4 tends to be weaker than Q3, so that's one where, yes, there always could be a little bit of noise. On immigration -- just repeat your immigration question again, sorry? Arvind A. Ramnani - BNP Paribas, Research Division: Have you all made any changes to your recruiting efforts and is there medium- to long-term dependency to reduce your dependency on H-1Bs? Gordon J. Coburn: So I think this is an important point. We've been evolving our model for a long time, well before the immigration debate started. 3 years ago, we started a U.S. college recruiting program. We now recruit several hundred students each year. We have 75 recruiters recruiting U.S.-based employees. So this is nothing new to us. We've been opening up our own development centers in the U.S. We now have centers in North Dakota and Iowa and Arizona and Texas and Florida and New Jersey. So this is an ongoing process for us. The challenge is, we have to hire thousands of people a year here in the U.S. and it's challenging to find enough qualified IT professionals. Where we can find them, we hire them. But particularly in the locations that we need, it is a challenge, so it's a mix. But doing more local hiring is a process that we've been doing for a while, and we'll continue to do. I think that is -- we are at the 8:00 mark. So with that, thank you, all, for joining this quarter call. Frank, you have any final comments? Francisco D'Souza: No, just thanks, everybody, for joining. And we're happy with the quarter's performance and we look forward to talking to you again next quarter.

Thank you. This does conclude today's Cognizant Technology Solutions' Second Quarter 2013 Earnings Conference Call. You may now disconnect.