Cognizant Technology Solutions, the US-based IT company with a large employee presence in India, has downsized its total office space by around 10 per cent in 2024, with a reduction of over 2 million sq ft space in the calendar year.
As per the IT major’s recent SEC filing, Cognizant had over 22 million sq ft of owned and leased delivery centre facilities as of December 2024. This is a decline from over 24 million as of December 2023 and 28 million as of December 2022. Cognizant has 90 per cent of its delivery centres (on a square-foot basis) in India.
As of December 2024, Cognizant owned or leased 8 million sq ft of office space in Chennai, 3 million sq ft in Hyderabad, and 2 million each in Pune, Bengaluru and Kolkata. The remaining space is distributed across smaller centres in the US, Philippines, Canada, Mexico and Europe. In comparison, the company had 9 million sq ft of space in Chennai and 3 million sq ft in Pune, two of its biggest centres in 2023.
Cognizant did not respond to businessline’s queries.
Responding to a query during a press meet with journalists last week, Cognizant CFO Jatin Dalal said they are “exiting a few facilities that are no longer being used or those the company does not plan to use.” Simultaneously, we are investing in building new facilities and going to newer tier-2 cities, he added. Bhubaneswar, Indore and Gift City in Ahmedabad are a few of Cognizant’s new smaller centres set to open soon. Real estate sector sources note that Cognizant has already kicked off plans to sell its own Chennai campus in Thoraipakkam, OMR, which is approx 400,000 sq ft.
“Majority IT services companies are still following hybrid model given that attrition levels are still at around 12 per cent plus,” Kamal Karanth, co-founder, Xpheno, said. The war for talent with GCCs, which offer flexible work options is also a reason, he added
The strategy to let go of prime real estate flows from the company’s cost optimisation programme NextGen, announced in 2023, under which it planned to cut real estate costs in prime locations and reinvest in smaller centres. Cognizant also follows a hybrid model of work. The company’s headcount as of December 31, 2024, stood at 336,800 with 241,500 in India, 42,800 in North America, 15,700 in Continental Europe and remaining in other locations globally.
