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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549





FORM 10-Q





(Mark One)

|x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ---------------------------------------------------------------------------------------

For the quarterly period ended September 30, 2010



| ̈ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ----------------------------------------------------------------------------------------

Commission File Number 000-21755





iGATE
CORPORATION

(Exact name of registrant as specified in its charter)







|                                                               |  |                                     
|-------------------------------------------------------------- |  | ------------------------------------
|PENNSYLVANIA                                                   |  | 25-1802235                          
|(State or other jurisdiction of
incorporation or organization) |  | (I.R.S. Employer Identification No.)
|                                                               | 
|6528 Kaiser Drive Fremont, CA                                  |  | 94555                               
|(Address of principal executive offices)                       |  | (Zip Code)                          

Registrants telephone number, including area code: (510) 896-3015

Securities registered pursuant to Section 12(g) of the Act: None





Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90
days.    Yes  x    No   ̈

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every
Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such
files).    Yes   ̈    No   ̈

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller
reporting company. See definitions of large accelerated filer, accelerated filer and smaller reporting company in Rule 12b-2 of the Exchange Act.:



|                        |  |                                                  |  |                           |  |  
|----------------------- |  | ------------------------------------------------ |  | ------------------------- |  | -
|Large accelerated filer |  |  ̈                                                |  | Accelerated filer         |  | x
|                        |  |                                                  | 
|Non-accelerated filer   |  |  ̈  (Do not check if a smaller reporting company) |  | Smaller reporting company |  |  ̈

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange
Act).    Yes   ̈    No  x

The number of shares of the registrants Common Stock, par value $.01 per share, outstanding as of September 30, 2010 was
55,862,200.









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iGATE CORPORATION

QUARTERLY REPORT ON FORM 10-Q

FOR THE QUARTER ENDED SEPTEMBER 30, 2010

TABLE OF CONTENTS



|           |  |                                                                                                              |    |      |    | 
|---------- |  | ------------------------------------------------------------------------------------------------------------ | -- | ---- | -- | 
|           |  |                                                                                                              |    | Page |   
|PART I.    |  | FINANCIAL INFORMATION                                                                                        |    |      | 3  | 
|           |  |                                                                                                             
|Item 1.    |  | Financial Statements:                                                                                        |    |      |    | 
|           |  |                                                                                                             
|           |  | Condensed Consolidated Statements of Income for the Three and Nine Months Ended September 30, 2010 and
2009 |    |      | 3  | 
|           |  |                                                                                                             
|           |  | Condensed Consolidated Balance Sheets as of September 30, 2010 and December 31,
2009                        |    |      | 4  | 
|           |  |                                                                                                             
|           |  | Condensed Consolidated Statements of Cash Flows for the Nine Months Ended September 
30, 2010 and 2009      |    |      | 5  | 
|           |  |                                                                                                             
|           |  | Notes to Unaudited Condensed Consolidated Financial Statements                                              |    |      | 6  | 
|           |  |                                                                                                             
|Item 2.    |  | Managements Discussion and Analysis of Financial Condition and Results of Operations                        |    |      | 18 | 
|           |  |                                                                                                             
|Item 3.    |  | Quantitative and Qualitative Disclosures About Market Risk                                                   |    |      | 24 | 
|           |  |                                                                                                             
|Item 4.    |  | Controls and Procedures                                                                                      |    |      | 25 | 
|           |  |                                                                                                             
|PART II.   |  | OTHER INFORMATION                                                                                            |    |      | 26 | 
|           |  |                                                                                                             
|Item 1A.   |  | Risk Factors                                                                                                 |    |      | 26 | 
|           |  |                                                                                                             
|Item 4.    |  | (Removed and Reserved)                                                                                       |    |      | 26 | 
|           |  |                                                                                                             
|Item 6.    |  | Exhibits                                                                                                     |    |      | 26 | 
|           | 
|SIGNATURES |  |                                                                                                              | 27 |     



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PART I. FINANCIAL INFORMATION



|ITEM 1. | FINANCIAL STATEMENTS
|------- | --------------------

iGATE CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(Amounts in thousands, except per share data)

(Unaudited)



|                                                              |  |                                  |        |  |                                 |   |        |      |  |   |         |  |  |   |         |  
|------------------------------------------------------------- |  | -------------------------------- | ------ |  | ------------------------------- | - | ------ | ---- |  | - | ------- |  |  | - | ------- | -
|                                                              |  | Three Months 
EndedSeptember 30, |        |  | Nine Months 
EndedSeptember 30, |  
|                                                              |  | 2010                             |        |  | 2009                            |   |        | 2010 |  |   | 2009    | 
|Revenues                                                      |  | $                                | 74,845 |  |                                 | $ | 49,055 |      |  | $ | 199,584 |  |  | $ | 140,695 |  
|Cost of revenues (exclusive of depreciation and amortization) |  |                                  | 45,378 |  |                                 |   | 28,897 |      |  |   | 121,446 |  |  |   | 86,559  |  
|                                                              |  |                                  |        |  |                                 |   |        |      |  |   |         |  |  |   |         |  
|Gross margin                                                  |  |                                  | 29,467 |  |                                 |   | 20,158 |      |  |   | 78,138  |  |  |   | 54,136  |  
|Selling, general and administrative                           |  |                                  | 12,056 |  |                                 |   | 9,197  |      |  |   | 33,904  |  |  |   | 26,635  |  
|Depreciation and amortization                                 |  |                                  | 2,251  |  |                                 |   | 1,837  |      |  |   | 6,599   |  |  |   | 5,607   |  
|                                                              |  |                                  |        |  |                                 |   |        |      |  |   |         |  |  |   |         |  
|Income from operations                                        |  |                                  | 15,160 |  |                                 |   | 9,124  |      |  |   | 37,635  |  |  |   | 21,894  |  
|Other income (expense), net                                   |  |                                  | 961    |  |                                 |   | 38     |      |  |   | 2,769   |  |  |   | (1,702  | )
|                                                              |  |                                  |        |  |                                 |   |        |      |  |   |         |  |  |   |         |  
|Income before income taxes                                    |  |                                  | 16,121 |  |                                 |   | 9,162  |      |  |   | 40,404  |  |  |   | 20,192  |  
|Income tax expense                                            |  |                                  | 1,856  |  |                                 |   | 278    |      |  |   | 3,371   |  |  |   | 251     |  
|                                                              |  |                                  |        |  |                                 |   |        |      |  |   |         |  |  |   |         |  
|Net income                                                    |  | $                                | 14,265 |  |                                 | $ | 8,884  |      |  | $ | 37,033  |  |  | $ | 19,941  |  
|                                                              |  |                                  |        |  |                                 |   |        |      |  |   |         |  |  |   |         |  
|                                                              |  |                                  |        | 
|Distributed earnings per share:                               |  |                                  |        |  |                                 |   |        |      |  |   |         |  |  |   |         |  
|Common stock                                                  |  | $                                |       |  |                                 | $ |       |      |  | $ | 0.11    |  |  | $ | 0.11    |  
|Unvested restricted stock                                     |  |                                  |       |  |                                 |   |       |      |  |   | 0.11    |  |  |   | 0.11    |  
|                                                              |  |                                  |        | 
|Basic earnings per share:                                     |  |                                  |        |  |                                 |   |        |      |  |   |         |  |  |   |         |  
|Common stock                                                  |  | $                                | 0.25   |  |                                 | $ | 0.16   |      |  | $ | 0.66    |  |  | $ | 0.36    |  
|Unvested restricted stock                                     |  |                                  | 0.25   |  |                                 |   | 0.16   |      |  |   | 0.66    |  |  |   | 0.36    |  
|                                                              |  |                                  |        | 
|Diluted earnings per share                                    |  | $                                | 0.25   |  |                                 | $ | 0.16   |      |  | $ | 0.65    |  |  | $ | 0.36    |  

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



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iGATE CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS

(Amounts in thousands, except
share and per share data)



|                                                                                                                                                                                                                                                      |  |                              |         |   |                  |   |         |  
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ---------------------------- | ------- | - | ---------------- | - | ------- | -
|                                                                                                                                                                                                                                                      |  | September 30,2010(Unaudited) |         |   | December 31,2009 |  
|ASSETS                                                                                                                                                                                                                                                |  |                              |         |   |                  |   |         |  
|Current assets:                                                                                                                                                                                                                                       |  |                              |         |   |                  |   |         |  
|Cash and cash equivalents                                                                                                                                                                                                                             |  | $                            | 27,579  |   |                  | $ | 29,565  |  
|Short-term investments                                                                                                                                                                                                                                |  |                              | 93,264  |   |                  |   | 67,192  |  
|Accounts receivable, net                                                                                                                                                                                                                              |  |                              | 37,458  |   |                  |   | 24,533  |  
|Unbilled revenues                                                                                                                                                                                                                                     |  |                              | 18,808  |   |                  |   | 9,636   |  
|Prepaid expenses and other current assets                                                                                                                                                                                                             |  |                              | 5,067   |   |                  |   | 4,628   |  
|Prepaid income taxes                                                                                                                                                                                                                                  |  |                              | 1,017   |   |                  |   | 4,247   |  
|Deferred tax assets                                                                                                                                                                                                                                   |  |                              | 2,798   |   |                  |   | 31      |  
|Foreign exchange derivative contracts                                                                                                                                                                                                                 |  |                              | 1,632   |   |                  |   |        |  
|Receivable from Mastech Holdings Inc.                                                                                                                                                                                                                 |  |                              | 242     |   |                  |   | 87      |  
|                                                                                                                                                                                                                                                      |  |                              |         |   |                  |   |         |  
|Total current assets                                                                                                                                                                                                                                  |  |                              | 187,865 |   |                  |   | 139,919 |  
|Deposits and other assets                                                                                                                                                                                                                             |  |                              | 5,722   |   |                  |   | 4,482   |  
|Property and equipment, net                                                                                                                                                                                                                           |  |                              | 49,851  |   |                  |   | 42,682  |  
|Deferred tax assets                                                                                                                                                                                                                                   |  |                              | 10,710  |   |                  |   | 8,474   |  
|Goodwill                                                                                                                                                                                                                                              |  |                              | 31,577  |   |                  |   | 30,517  |  
|Intangible assets, net                                                                                                                                                                                                                                |  |                              | 1,573   |   |                  |   | 2,086   |  
|                                                                                                                                                                                                                                                      |  |                              |         |   |                  |   |         |  
|Total assets                                                                                                                                                                                                                                          |  | $                            | 287,298 |   |                  | $ | 228,160 |  
|                                                                                                                                                                                                                                                      |  |                              |         |   |                  |   |         |  
|                                                                                                                                                                                                                                                      |  |                             
|LIABILITIES AND SHAREHOLDERS EQUITY                                                                                                                                                                                                                  |  |                              |         |   |                  |   |         |  
|Current liabilities:                                                                                                                                                                                                                                  |  |                              |         |   |                  |   |         |  
|Accounts payable                                                                                                                                                                                                                                      |  | $                            | 2,977   |   |                  | $ | 1,515   |  
|Accrued payroll and related costs                                                                                                                                                                                                                     |  |                              | 17,815  |   |                  |   | 14,173  |  
|Other accrued liabilities                                                                                                                                                                                                                             |  |                              | 25,506  |   |                  |   | 18,003  |  
|Foreign exchange derivative contracts                                                                                                                                                                                                                 |  |                              |        |   |                  |   | 1,097   |  
|Restructuring reserve                                                                                                                                                                                                                                 |  |                              | 58      |   |                  |   | 101     |  
|Deferred revenue                                                                                                                                                                                                                                      |  |                              | 424     |   |                  |   | 918     |  
|                                                                                                                                                                                                                                                      |  |                              |         |   |                  |   |         |  
|Total current liabilities                                                                                                                                                                                                                             |  |                              | 46,780  |   |                  |   | 35,807  |  
|Other long-term liabilities                                                                                                                                                                                                                           |  |                              | 1,133   |   |                  |   | 1,035   |  
|                                                                                                                                                                                                                                                      |  |                              |         |   |                  |   |         |  
|Total liabilities                                                                                                                                                                                                                                     |  |                              | 47,913  |   |                  |   | 36,842  |  
|                                                                                                                                                                                                                                                      |  |                              |         |   |                  |   |         |  
|                                                                                                                                                                                                                                                      |  |                             
|Commitments (Note 13)                                                                                                                                                                                                                                 |  |                              |         |   |                  |   |         |  
|Shareholders equity:                                                                                                                                                                                                                                 |  |                              |         |   |                  |   |         |  
|Preferred shares, without par value: 20,000,000 shares authorized, 1 share held in treasury                                                                                                                                                           |  |                              |        |   |                  |   |        |  
|Common shares, par value $0.01 per share:                                                                                                                                                                                                             |  |                              |         |   |                  |   |         |  
|100,000,000 shares authorized, and 56,852,302 and 56,126,209 shares issued as of September 30, 2010 and December 31,
2009, respectively and 55,862,200 and 55,136,107 shares outstanding as of September 30, 2010 and December 31, 2009, respectively |  |                              | 569     |   |                  |   | 561     |  
|Common shares held in treasury, at cost, 990,102 shares                                                                                                                                                                                               |  |                              | (14,714 | ) |                  |   | (14,714 | )
|Additional paid-in capital                                                                                                                                                                                                                            |  |                              | 186,406 |   |                  |   | 180,278 |  
|Retained earnings                                                                                                                                                                                                                                     |  |                              | 69,185  |   |                  |   | 38,228  |  
|Accumulated other comprehensive loss                                                                                                                                                                                                                  |  |                              | (2,061  | ) |                  |   | (13,035 | )
|                                                                                                                                                                                                                                                      |  |                              |         |   |                  |   |         |  
|Total shareholders equity                                                                                                                                                                                                                            |  |                              | 239,385 |   |                  |   | 191,318 |  
|                                                                                                                                                                                                                                                      |  |                              |         |   |                  |   |         |  
|Total liabilities and shareholders equity                                                                                                                                                                                                            |  | $                            | 287,298 |   |                  | $ | 228,160 |  
|                                                                                                                                                                                                                                                      |  |                              |         |   |                  |   |         |  

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



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iGATE CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Amounts in thousands)

(Unaudited)



|                                                                              |  |                                 |         |   |      |   |         |  
|----------------------------------------------------------------------------- |  | ------------------------------- | ------- | - | ---- | - | ------- | -
|                                                                              |  | Nine Months 
endedSeptember 30, |        
|                                                                              |  | 2010                            |         |   | 2009 |  
|Cash Flows From Operating Activities:                                         |  |                                 |         |   |      |   |         |  
|Net income                                                                    |  | $                               | 37,033  |   |      | $ | 19,941  |  
|Adjustments to reconcile net income to cash provided by operating activities: |  |                                 |         |   |      |   |         |  
|Depreciation and amortization                                                 |  |                                 | 6,599   |   |      |   | 5,607   |  
|Stock based compensation                                                      |  |                                 | 4,822   |   |      |   | 3,963   |  
|Realized gain on investments                                                  |  |                                 | (1,928  | ) |      |   | (1,803  | )
|Doubtful debts (Recovered) Provision                                          |  |                                 | (297    | ) |      |   | 255     |  
|Deferred income taxes                                                         |  |                                 | (4,568  | ) |      |   | (3,083  | )
|Gain on sale of property and equipment                                        |  |                                 | (1,341  | ) |      |   | (2      | )
|Gain on sale of investments in affiliate                                      |  |                                 | (568    | ) |      |   |        |  
|Deferred rent                                                                 |  |                                 | 89      |   |      |   | 108     |  
|Working capital items:                                                        |  |                                 |         |   |      |   |         |  
|Accounts receivable and unbilled revenues                                     |  |                                 | (21,630 | ) |      |   | 6,601   |  
|Prepaid expenses and other current assets                                     |  |                                 | (464    | ) |      |   | 613     |  
|Accounts payable                                                              |  |                                 | 124     |   |      |   | (249    | )
|Other liabilities                                                             |  |                                 | 13,679  |   |      |   | (523    | )
|Restructuring reserve                                                         |  |                                 | (43     | ) |      |   | (171    | )
|Deferred revenue                                                              |  |                                 | (498    | ) |      |   | 566     |  
|                                                                              |  |                                 |         |   |      |   |         |  
|Net cash provided by operating activities                                     |  |                                 | 31,009  |   |      |   | 31,823  |  
|                                                                              |  |                                 |         |   |      |   |         |  
|                                                                              |  |                                
|Cash Flows From Investing Activities:                                         |  |                                 |         |   |      |   |         |  
|Purchase of property and equipment                                            |  |                                 | (11,720 | ) |      |   | (9,044  | )
|Sale of property and equipment                                                |  |                                 | 3,234   |   |      |   |        |  
|Purchase of investments                                                       |  |                                 | (57,046 | ) |      |   | (44,739 | )
|Sale of investments                                                           |  |                                 | 35,685  |   |      |   | 26,180  |  
|Receipts from (payments for) lease deposits                                   |  |                                 | 28      |   |      |   | (132    | )
|Proceeds from sale of investment in affiliate                                 |  |                                 | 568     |   |      |   |        |  
|                                                                              |  |                                 |         |   |      |   |         |  
|Net cash used in investing activities                                         |  |                                 | (29,251 | ) |      |   | (27,735 | )
|                                                                              |  |                                 |         |   |      |   |         |  
|                                                                              |  |                                
|Cash Flows From Financing Activities:                                         |  |                                 |         |   |      |   |         |  
|Payments on capital lease obligations                                         |  |                                 | (163    | ) |      |   | (99     | )
|Dividends paid                                                                |  |                                 | (6,076  | ) |      |   | (5,960  | )
|Net proceeds from exercise of stock options                                   |  |                                 | 1,698   |   |      |   | 1,642   |  
|Purchase of subsidiarys stock                                                |  |                                 | (39     | ) |      |   | (61     | )
|Payment of withholding taxes related to restricted stock                      |  |                                 | (964    | ) |      |   |        |  
|Tax benefits related to stock option exercises                                |  |                                 | 572     |   |      |   | (113    | )
|                                                                              |  |                                 |         |   |      |   |         |  
|Net cash used in financing activities                                         |  |                                 | (4,972  | ) |      |   | (4,591  | )
|                                                                              |  |                                 |         |   |      |   |         |  
|Effect of currency translation                                                |  |                                 | 1,228   |   |      |   | (726    | )
|                                                                              |  |                                 |         |   |      |   |         |  
|Net change in cash and cash equivalents                                       |  |                                 | (1,986  | ) |      |   | (1,229  | )
|Cash and cash equivalents, beginning of period                                |  |                                 | 29,565  |   |      |   | 30,878  |  
|                                                                              |  |                                 |         |   |      |   |         |  
|Cash and cash equivalents, end of period                                      |  | $                               | 27,579  |   |      | $ | 29,649  |  
|                                                                              |  |                                 |         |   |      |   |         |  

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



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iGATE CORPORATION

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER
30, 2010 AND 2009

(Amounts in thousands)

1. Basis of Presentation

The accompanying unaudited Condensed Consolidated
Financial Statements of iGATE Corporation (iGATE or the Company) have been prepared by management in accordance with U.S. generally accepted accounting principles for interim financial information and applicable rules and
regulations of the Securities and Exchange Commission. Accordingly, they do not include all of the information and disclosures required by U.S. generally accepted accounting principles for complete financial statements. In the opinion of management,
all adjustments (consisting only of normally recurring adjustments) considered necessary for a fair presentation have been included.

The accompanying balance sheet and financial information as of December 31, 2009 is derived from audited financial statements but does not include all of the information and footnotes required by
U.S. generally accepted accounting principles for complete financial statements. The results of operations for the three and nine months ended September 30, 2010 are not necessarily indicative of the results that may be expected for the full
year. These financial statements should be read in conjunction with the Companys audited financial statements and notes thereto included in its Annual Report on Form 10-K for the year ended December 31, 2009.

Principles of Consolidation

The Condensed Consolidated Financial Statements include the accounts of the Company and its subsidiaries. All intercompany accounts and transactions have been eliminated.

Use of Estimates

Preparing financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets,
liabilities, revenues and expenses. Actual results may differ from these estimates. Interim results are not necessarily indicative of results for a full year.

Recently Issued Accounting Pronouncements

In October 2009, the FASB
issued ASU No. 2009-13 Revenue recognitionMultiple deliverable revenue arrangements . The ASU provides amendments to the criteria in Revenue recognitionmultiple element arrangements for separating
consideration in multiple element arrangements. The amendments in this ASU establish a selling price hierarchy for determining the selling price of a deliverable. Further, the term fair value in the revenue guidance will be replaced with
selling price to clarify that the allocation of revenue is based on entity-specific assumptions rather than assumptions of a market place participant. The amendments in this ASU will be effective prospectively for revenue arrangements entered
into or materially modified in fiscal years beginning on or after June 15, 2010. Early adoption is permitted. The Company currently does not have multiple deliverable revenue arrangements and hence, does not expect the adoption to have an
impact on its consolidated financial statements.



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iGATE CORPORATION

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS  (CONTINUED)

SEPTEMBER 30, 2010 AND 2009

(Amounts in thousands)



2. Goodwill and Intangible Assets

The changes in the carrying value of goodwill for the nine months ended September 30, 2010 (in thousands):



|                                    |  |        |        | 
|----------------------------------- |  | ------ | ------ | 
|                                    |  | Amount |       
|Goodwill as of December 31, 2009    |  | $      | 30,517 | 
|Foreign currency translation effect |  |        | 1,060  | 
|                                    |  |        |        | 
|Goodwill as of September 30, 2010   |  | $      | 31,577 | 
|                                    |  |        |        | 

Intangible assets relate to customer relationships. The changes in the carrying value during for the nine
months ended September 30, 2010 (in thousands):



|                                           |  |        |       |  
|------------------------------------------ |  | ------ | ----- | -
|                                           |  | Amount |      
|Intangible assets as of December 31, 2009  |  | $      | 2,086 |  
|Foreign currency translation effect        |  |        | 64    |  
|Amortization                               |  |        | (577  | )
|                                           |  |        |       |  
|Intangible assets as of September 30, 2010 |  | $      | 1,573 |  
|                                           |  |        |       |  

Amortization expenses related to identifiable intangible assets was $0.6 million and $0.7 million for the
nine months ended September 30, 2010 and 2009, respectively. Future estimated annual amortization is as follows (in thousands):



|                  |  |        |       | 
|----------------- |  | ------ | ----- | 
|                  |  | Amount |      
|Remainder of 2010 |  | $      | 199   | 
|2011              |  |        | 790   | 
|2012              |  |        | 584   | 
|                  |  |        |       | 
|                  |  | $      | 1,573 | 
|                  |  |        |       | 



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iGATE CORPORATION

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS  (CONTINUED)

SEPTEMBER 30, 2010 AND 2009

(Amounts in thousands)



3. Income Taxes

The provision for income taxes, as shown in the accompanying Condensed Consolidated Financial Statements, consists of the following (in thousands):



|                                 |  |                                  |        |   |                                 |   |        |      |  |   |        |   |  |   |        |  
|-------------------------------- |  | -------------------------------- | ------ | - | ------------------------------- | - | ------ | ---- |  | - | ------ | - |  | - | ------ | -
|                                 |  | Three Months 
EndedSeptember 30, |        |   | Nine Months 
EndedSeptember 30, |  
|                                 |  | 2010                             |        |   | 2009                            |   |        | 2010 |  |   | 2009   |  
|Current provision:               |  |                                  |        |   |                                 |   |        |      |  |   |        |   |  |   |        |  
|Federal                          |  | $                                | 1,230  |   |                                 | $ | 8      |      |  | $ | 2,125  |   |  | $ | 8      |  
|State                            |  |                                  | 269    |   |                                 |   | 2      |      |  |   | 382    |   |  |   | 64     |  
|Foreign                          |  |                                  | 2,093  |   |                                 |   | 1,935  |      |  |   | 5,518  |   |  |   | 3,380  |  
|                                 |  |                                  |        |   |                                 |   |        |      |  |   |        |   |  |   |        |  
|Total current provision          |  |                                  | 3,592  |   |                                 |   | 1,945  |      |  |   | 8,025  |   |  |   | 3,452  |  
|                                 |  |                                  |        |   |                                 |   |        |      |  |   |        |   |  |   |        |  
|Deferred benefit:                |  |                                  |        |   |                                 |   |        |      |  |   |        |   |  |   |        |  
|Federal                          |  |                                  |       |   |                                 |   |       |      |  |   |       |   |  |   | (12    | )
|State                            |  |                                  |       |   |                                 |   |       |      |  |   |       |   |  |   | (2     | )
|Foreign                          |  |                                  | (1,736 | ) |                                 |   | (1,667 | )    |  |   | (4,654 | ) |  |   | (3,187 | )
|                                 |  |                                  |        |   |                                 |   |        |      |  |   |        |   |  |   |        |  
|Total deferred benefit           |  |                                  | (1,736 | ) |                                 |   | (1,667 | )    |  |   | (4,654 | ) |  |   | (3,201 | )
|                                 |  |                                  |        |   |                                 |   |        |      |  |   |        |   |  |   |        |  
|Total provision for income taxes |  | $                                | 1,856  |   |                                 | $ | 278    |      |  | $ | 3,371  |   |  | $ | 251    |  
|                                 |  |                                  |        |   |                                 |   |        |      |  |   |        |   |  |   |        |  

The reconciliation of income taxes computed using the statutory U.S. income tax rate and the provision for
income taxes were as follows:



|                                                           |  |                                      |         |   |                                      |  |       |   |  |   |        |   |  |  |       |  
|---------------------------------------------------------- |  | ------------------------------------ | ------- | - | ------------------------------------ |  | ----- | - |  | - | ------ | - |  |  | ----- | -
|                                                           |  | Three Months EndedSeptember 30, 2010 |         |   | Three Months EndedSeptember 30, 2009 | 
|Income taxes computed at the federal statutory rate        |  | $                                    | 5,642   |   |                                      |  | 35.0  | % |  | $ | 3,115  |   |  |  | 34.0  | %
|State income taxes, net of federal tax benefit             |  |                                      | 178     |   |                                      |  | 1.1   |   |  |   | 1      |   |  |  |      |  
|Benefit for untaxed foreign income, subject to tax holiday |  |                                      | (4,402  | ) |                                      |  | (27.3 | ) |  |   | (2,763 | ) |  |  | (30.2 | )
|Foreign taxes at other than U.S. statutory rate            |  |                                      | (72     | ) |                                      |  | (0.5  | ) |  |   | 202    |   |  |  | 2.2   |  
|Unbenefited tax losses                                     |  |                                      | 28      |   |                                      |  | 0.2   |   |  |   | (286   | ) |  |  | (3.1  | )
|Othernet                                                  |  |                                      | 482     |   |                                      |  | 3.0   |   |  |   | 9      |   |  |  | 0.1   |  
|                                                           |  |                                      |         |   |                                      |  |       |   |  |   |        |   |  |  |       |  
|                                                           |  | $                                    | 1,856   |   |                                      |  | 11.5  | % |  | $ | 278    |   |  |  | 3.0   | %
|                                                           |  |                                      |         |   |                                      |  |       |   |  |   |        |   |  |  |       |  
|                                                           |  |                                     
|                                                           |  | Nine Months EndedSeptember 30, 2010  |         |   | Nine Months EndedSeptember 30, 2009  | 
|Income taxes computed at the federal statutory rate        |  | $                                    | 14,141  |   |                                      |  | 35.0  | % |  | $ | 6,865  |   |  |  | 34.0  | %
|State income taxes, net of federal tax benefit             |  |                                      | 253     |   |                                      |  | 0.6   |   |  |   | 41     |   |  |  | 0.2   |  
|Benefit for untaxed foreign income, subject to tax holiday |  |                                      | (11,909 | ) |                                      |  | (29.5 | ) |  |   | (6,985 | ) |  |  | (34.6 | )
|Foreign taxes at other than U.S. statutory rate            |  |                                      | (266    | ) |                                      |  | (0.7  | ) |  |   | 183    |   |  |  | 0.9   |  
|Unbenefited tax losses                                     |  |                                      | 362     |   |                                      |  | 0.9   |   |  |   | 131    |   |  |  | 0.6   |  
|Othernet                                                  |  |                                      | 790     |   |                                      |  | 2.0   |   |  |   | 16     |   |  |  | 0.1   |  
|                                                           |  |                                      |         |   |                                      |  |       |   |  |   |        |   |  |  |       |  
|                                                           |  | $                                    | 3,371   |   |                                      |  | 8.3   | % |  | $ | 251    |   |  |  | 1.2   | %
|                                                           |  |                                      |         |   |                                      |  |       |   |  |   |        |   |  |  |       |  



8



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##### Table of Contents

iGATE CORPORATION

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS  (CONTINUED)

SEPTEMBER 30, 2010 AND 2009

(Amounts in thousands)



Under the Indian Income Tax Act, 1961, our subsidiary iGATE Global Solutions Ltd.
(iGS) is eligible to claim a tax holiday for ten consecutive assessment years on profits derived from the export of software services from divisions registered under the Software Technology Parks at Bangalore and Noida. For the three and
nine months ended September 30, 2010, the tax holiday benefits were $3.3 million and $8.9 million, respectively, as compared to $2.1 million and $5.3 million for the three and nine months ended September 30, 2009, respectively, when
calculated at the statutory US rate. The majority of the remaining benefits will extend through March 2011. Non-operating income, such as interest income and capital gains income along with operating income to the extent of expiry of tax holiday is
not included in the tax holiday, and has been considered as part of our income tax provision.

In 2009, iGS set up units in
Chennai and Hyderabad Special Economic Zone (SEZ). Under the Indian Income Tax Act, 1961, iGS is eligible to claim income tax holiday of 100% for the initial five consecutive assessment years followed by 50% for the subsequent ten
consecutive assessment years on the profits derived from the export of software services from the divisions registered under the SEZ. For the three and nine months ended September 30, 2010, the tax holiday benefits were $1.1 million and $3.0
million, respectively, as compared to $0.7 million and $1.7 million for the three and nine months ended September 30, 2009, respectively, when calculated at the statutory US rate.

4. Earnings Per Share

The Company computes earnings per share in
accordance with ASC Topic 260, Earnings per share and ASC Topic 260-10-45 Determining Whether Instruments Granted in Share-Based Payment Transactions Are Participating Securities. Basic earnings per share for
the two classes of stock (common stock and unvested restricted stock) is calculated by dividing net income by the weighted average number of shares of common stock and unvested restricted stock outstanding. Diluted earnings per share is computed
using the weighted average number of common stock and unvested restricted stock plus the potentially dilutive effect of common stock equivalents

Earnings per share for the common stock and the unvested restricted stock under the two class method are presented below (dollars and shares in thousands, except per share data):



|                                                       |  |                                 |        |  |                                |   |        |      |  |   |        |  |  |   |        | 
|------------------------------------------------------ |  | ------------------------------- | ------ |  | ------------------------------ | - | ------ | ---- |  | - | ------ |  |  | - | ------ | 
|                                                       |  | Three Months
EndedSeptember 30, |        |  | Nine Months
EndedSeptember 30, |  
|                                                       |  | 2010                            |        |  | 2009                           |   |        | 2010 |  |   | 2009   | 
|Net income                                             |  | $                               | 14,265 |  |                                | $ | 8,884  |      |  | $ | 37,033 |  |  | $ | 19,941 | 
|                                                       |  |                                 |        |  |                                |   |        |      |  |   |        |  |  |   |        | 
|Less: Dividends paid on                                |  |                                 |        |  |                                |   |        |      |  |   |        |  |  |   |        | 
|Common stock                                           |  |                                 |       |  |                                |   |       |      |  |   | 6,076  |  |  |   | 5,894  | 
|Unvested restricted stock                              |  |                                 |       |  |                                |   |       |      |  |   | 60     |  |  |   | 66     | 
|                                                       |  |                                 |        |  |                                |   |        |      |  |   |        |  |  |   |        | 
|                                                       |  |                                 |       |  |                                |   |       |      |  |   | 6,136  |  |  |   | 5,960  | 
|                                                       |  |                                 |        |  |                                |   |        |      |  |   |        |  |  |   |        | 
|Undistributed Income                                   |  | $                               | 14,265 |  |                                | $ | 8,884  |      |  | $ | 30,897 |  |  | $ | 13,981 | 
|                                                       |  |                                 |        |  |                                |   |        |      |  |   |        |  |  |   |        | 
|Basic and diluted allocation of undistributed income : |  |                                 |        |  |                                |   |        |      |  |   |        |  |  |   |        | 
|Common stock                                           |  | $                               | 14,181 |  |                                | $ | 8,786  |      |  | $ | 30,667 |  |  | $ | 13,826 | 
|Unvested restricted stock                              |  |                                 | 84     |  |                                |   | 98     |      |  |   | 230    |  |  |   | 155    | 
|                                                       |  |                                 |        |  |                                |   |        |      |  |   |        |  |  |   |        | 
|                                                       |  | $                               | 14,265 |  |                                | $ | 8,884  |      |  | $ | 30,897 |  |  | $ | 13,981 | 
|                                                       |  |                                 |        |  |                                |   |        |      |  |   |        |  |  |   |        | 
|Weighted average shares outstanding:                   |  |                                 |        |  |                                |   |        |      |  |   |        |  |  |   |        | 
|Common stock                                           |  |                                 | 55,762 |  |                                |   | 54,619 |      |  |   | 55,493 |  |  |   | 54,357 | 
|Unvested restricted stock                              |  |                                 | 330    |  |                                |   | 608    |      |  |   | 417    |  |  |   | 608    | 
|                                                       |  |                                 |        |  |                                |   |        |      |  |   |        |  |  |   |        | 
|                                                       |  |                                 | 56,092 |  |                                |   | 55,227 |      |  |   | 55,910 |  |  |   | 54,965 | 
|                                                       |  |                                 |        |  |                                |   |        |      |  |   |        |  |  |   |        | 
|Weighted average common stock outstanding              |  |                                 | 55,762 |  |                                |   | 54,619 |      |  |   | 55,493 |  |  |   | 54,357 | 
|                                                       |  |                                 |        |  |                                |   |        |      |  |   |        |  |  |   |        | 
|Dilutive effect of stock options outstanding           |  |                                 | 1,736  |  |                                |   | 1,534  |      |  |   | 1,690  |  |  |   | 1,255  | 
|                                                       |  |                                 |        |  |                                |   |        |      |  |   |        |  |  |   |        | 
|Dilutive weighted average shares outstanding           |  |                                 | 57,498 |  |                                |   | 56,153 |      |  |   | 57,183 |  |  |   | 55,612 | 
|                                                       |  |                                 |        |  |                                |   |        |      |  |   |        |  |  |   |        | 



9



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##### Table of Contents

iGATE CORPORATION

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS  (CONTINUED)

SEPTEMBER 30, 2010 AND 2009

(Amounts in thousands)



The number of outstanding options to purchase common shares for which the option
exercise prices exceeded the average market price of the common shares aggregated 0.3 million and 0.5 million shares for the three months ended September 30, 2010 and 2009, respectively. The number of outstanding options to purchase
common shares for which the option exercise prices exceeded the average market price of the common shares aggregated 0.3 million and 0.7 million shares for the nine months ended September 30, 2010 and 2009, respectively. These options
were excluded from the computation of diluted earnings per share under the treasury stock method.

5. Short Term Investments



|                           |               |                          |        |                 |  |   |            |   |  |   |        | 
|-------------------------- | ------------- | ------------------------ | ------ | --------------- |  | - | ---------- | - |  | - | ------ | 
|                           |               | As of September 30, 2010 |       
|                           | CarryingValue |                          |        | Unrealized Gain |  |   | Fair Value |  
|Money market mutual funds  |               | $                        | 91,686 |                 |  | $ | 465        |   |  | $ | 92,151 | 
|Non convertible debentures |               |                          | 1,113  |                 |  |   |           |   |  |   | 1,113  | 
|                           |               |                          |        |                 |  |   |            |   |  |   |        | 
|                           |               | $                        | 92,799 |                 |  | $ | 465        |   |  | $ | 93,264 | 
|                           |               |                          |        |                 |  |   |            |   |  |   |        | 
|                           |              
|                           |               | As of December 31, 2009  |       
|                           | CarryingValue |                          |        | Unrealized Loss |  |   | Fair Value |  
|Money market mutual funds  |               | $                        | 67,579 |                 |  | $ | (387       | ) |  | $ | 67,192 | 
|                           |               |                          |        |                 |  |   |            |   |  |   |        | 

6. Comprehensive Income



|                                                        |  |                                  |        |  |                                 |   |       |      |  |   |        |  |  |   |        |  
|------------------------------------------------------- |  | -------------------------------- | ------ |  | ------------------------------- | - | ----- | ---- |  | - | ------ |  |  | - | ------ | -
|                                                        |  | Three Months 
EndedSeptember 30, |        |  | Nine Months 
EndedSeptember 30, |  
|                                                        |  | 2010                             |        |  | 2009                            |   |       | 2010 |  |   | 2009   | 
|Net income                                              |  | $                                | 14,265 |  |                                 | $ | 8,884 |      |  | $ | 37,033 |  |  | $ | 19,941 |  
|Foreign currency translation                            |  |                                  | 7,334  |  |                                 |   | (767  | )    |  |   | 7,058  |  |  |   | 1,391  |  
|Change in fair value of cash flow hedges                |  |                                  | 1,263  |  |                                 |   | 1,363 |      |  |   | 2,912  |  |  |   | 5,916  |  
|Unrealized gain (loss) on investments                   |  |                                  | 206    |  |                                 |   | (178  | )    |  |   | 852    |  |  |   | (794   | )
|Unrecognized actuarial gain (loss) on pension liability |  |                                  | 68     |  |                                 |   | 2     |      |  |   | 152    |  |  |   | (118   | )
|                                                        |  |                                  |        |  |                                 |   |       |      |  |   |        |  |  |   |        |  
|Comprehensive income                                    |  | $                                | 23,136 |  |                                 | $ | 9,304 |      |  | $ | 48,007 |  |  | $ | 26,336 |  
|                                                        |  |                                  |        |  |                                 |   |       |      |  |   |        |  |  |   |        |  

Accumulated Other Comprehensive Loss

The components of accumulated other comprehensive loss was as follows (in thousands):



|                                                                |  |                   |        |   |                  |   |         |  
|--------------------------------------------------------------- |  | ----------------- | ------ | - | ---------------- | - | ------- | -
|                                                                |  | As of             |       
|                                                                |  | September 30,2010 |        |   | December 31,2009 |  
|Loss on foreign currency translation                            |  | $                 | (4,228 | ) |                  | $ | (11,286 | )
|Unrealized gain (loss) on foreign exchange derivative contracts |  |                   | 1,595  |   |                  |   | (1,317  | )
|Unrealized gain (loss) on investment                            |  |                   | 465    |   |                  |   | (387    | )
|Actuarial gain (loss) relating to defined benefit plan          |  |                   | 107    |   |                  |   | (45     | )
|                                                                |  |                   |        |   |                  |   |         |  
|                                                                |  | $                 | (2,061 | ) |                  | $ | (13,035 | )
|                                                                |  |                   |        |   |                  |   |         |  



10



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iGATE CORPORATION

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS  (CONTINUED)

SEPTEMBER 30, 2010 AND 2009

(Amounts in thousands)



7. Derivative Instruments and Hedging Activities

As part of the Companys on-going business operations, certain assets and forecasted transactions are exposed to foreign currency
risks due to fluctuations in exchange rate between the Rupee, CAD and USD. The objective for holding derivatives is to eliminate or reduce the impact of these exposures.

The Company enters into forward foreign exchange contracts to mitigate the risk of changes in foreign exchange rates on inter-company transactions and forecasted transactions denominated in foreign
currencies. Contracts are designated as cash flow hedges if they satisfy the criteria for hedge accounting under ASC Topic 815 Accounting for Derivative Instruments and Hedging Activities The effective portion of the gain or loss
on the derivative is reported as a component of other comprehensive income and reclassified into earnings in the same period or periods during which the hedged transaction affects earnings. The ineffective portion of the gain or loss of hedging
instruments are recognized in the earnings of each period and are included in other income (expense), net.

The Company
documents all relationships between hedging instruments including the risk management objectives and strategy for each hedge transaction. In addition, formal assessment is done for effectiveness testing both at the inception of the hedge and on a
quarterly basis. If it is determined that a derivative or a portion thereof is not highly effective as a hedge, or if a derivative ceases to be a highly effective hedge, the Company will prospectively discontinue hedge accounting with respect to
that derivative.

In all situations in which hedge accounting is discontinued and the derivative is retained, the derivative
is continued to be carried at its fair value on the balance sheet and any subsequent change in its fair value is recognized in the consolidated statement of income.

The following table presents information related to foreign currency contracts held:

OUTSTANDING HEDGE TRANSACTIONS AS OF SEPTEMBER 30, 2010 (in thousands)



|                              |  |                     |            |  |                                |  |       |        |  |   |                                       |  |  |   |       | 
|----------------------------- |  | ------------------- | ---------- |  | ------------------------------ |  | ----- | ------ |  | - | ------------------------------------- |  |  | - | ----- | 
|                              |  | MaturityDate Ranges |            |  | Strike PriceAt RupeeRateRanges |  |       | Amount |  |   | Net UnrealizedGainsSeptember 30, 2010 | 
|CURRENCY OPTION CONTRACTS USD |  |                     |            |  |                                |  |       |        |  |   |                                       |  |  |   |       | 
|From:                         |  |                     | 22-Oct-10  |  |                                |  | 43.00 |        |  |   |                                       |  |  |   |       | 
|To:                           |  |                     | 29-Sept-11 |  |                                |  | 48.00 |        |  |   |                                       |  |  |   |       | 
|Subtotal                      |  |                     |            |  |                                |  |       |        |  | $ | 59,700                                |  |  | $ | 842   | 
|                              |  |                     |            | 
|CURRENCY OPTION CONTRACTS CAD |  |                     |            |  |                                |  |       |        |  |   |                                       |  |  |   |       | 
|From:                         |  |                     | 27-Oct-10  |  |                                |  | 44.25 |        |  |   |                                       |  |  |   |       | 
|To:                           |  |                     | 29-Sept-11 |  |                                |  | 46.20 |        |  |   |                                       |  |  |   |       | 
|Subtotal                      |  |                     |            |  |                                |  |       |        |  | $ | 41,353                                |  |  |   | 753   | 
|                              |  |                     |            |  |                                |  |       |        |  |   |                                       |  |  |   |       | 
|                              |  |                     |            |  |                                |  |       |        |  |   |                                       |  |  | $ | 1,595 | 
|                              |  |                     |            |  |                                |  |       |        |  |   |                                       |  |  |   |       | 



11



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iGATE CORPORATION

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS  (CONTINUED)

SEPTEMBER 30, 2010 AND 2009

(Amounts in thousands)



The option contracts as of September 30, 2010 will all mature by September 29,
2011. As each contract matures, the Company will sell USDs and CADs at each contracted strike price depending upon prevailing Rupee exchange rates. The outstanding contracts meet the qualifying criteria to receive hedge accounting and have been
deemed to be effective.

As a result, the Company has recorded accumulated other comprehensive gain of $1.6 million and
accumulated other comprehensive loss of $1.3 million as of September 30, 2010 and December 31, 2009, respectively. The unamortized premium on options of $0.04 million and $0.2 million is disclosed as part of derivative asset and net of
derivative liability as of September 30, 2010 and December, 31, 2009, respectively in the consolidated balance sheet.

The estimated net amount of existing gains as of September 30, 2010 that is expected to be reclassified from accumulated other
comprehensive income into earnings within next 12 months is $1.6 million.

The effect of Derivative Instruments on the
Condensed Consolidated Statements of Income for the three months ended September 30, 2010 (in thousands):



|                                 |  |                                              |       |  |                                                             |                         |                                                           |                                                                     |     |                                                          |  |                                                                   |  |  |   | 
|-------------------------------- |  | -------------------------------------------- | ----- |  | ----------------------------------------------------------- | ----------------------- | --------------------------------------------------------- | ------------------------------------------------------------------- | --- | -------------------------------------------------------- |  | ----------------------------------------------------------------- |  |  | - | 
|Derivatives as per ASC Topic 815 |  | Amount of Gainrecognized in OCIon Derivative |       |  | Location of Gainreclassified fromAccumulated OCIinto Income |                         | Amount of Gainreclassified fromAccumulated OCIinto Income |                                                                     |     | Location ofGain/(Loss)reclassified inIncome onDerivative |  | Amount of 
Gain/(Loss)Reclassified fromAccumulated OCIinto Income | 
|                                 |  | (Effective Portion)                          |       |  | (Effective Portion)                                         |                         |                                                           | (Ineffective Portion and amount excludedfrom effectiveness testing) |    
|                                 |  |                                              |      
|                                 |  | September 30, 2010                           |       |  | September 30, 2010                                          |                         |                                                           | September 30, 2010                                                  |    
|Foreign Exchange Contracts       |  | $                                            | 1,263 |  |                                                             | Other Income/(expenses) |                                                           | $                                                                   | 390 |                                                          |  | Other Income/(expenses)                                           |  |  |  | 

The effect
of Derivative Instruments on the Condensed Consolidated Statements of Income for the nine months ended September 30, 2010 (in thousands):



|                                 |  |                                              |       |  |                                                             |                         |                                                           |                                                                     |      |                                                           |  |                                                                   |  |  |   | 
|-------------------------------- |  | -------------------------------------------- | ----- |  | ----------------------------------------------------------- | ----------------------- | --------------------------------------------------------- | ------------------------------------------------------------------- | ---- | --------------------------------------------------------- |  | ----------------------------------------------------------------- |  |  | - | 
|Derivatives as per ASC Topic 815 |  | Amount of Gainrecognized in OCIon Derivative |       |  | Location of Lossreclassified fromAccumulated OCIinto Income |                         | Amount of Lossreclassified fromAccumulated OCIinto Income |                                                                     |      | Location ofGain/(Loss)reclassified 
inIncome onDerivative |  | Amount of 
Gain/(Loss)Reclassified fromAccumulated OCIinto Income | 
|                                 |  | (Effective Portion)                          |       |  | (Effective Portion)                                         |                         |                                                           | (Ineffective Portion and amount excludedfrom effectiveness testing) |     
|                                 |  |                                              |      
|                                 |  | September 30, 2010                           |       |  | September 30, 2010                                          |                         |                                                           | September 30, 2010                                                  |     
|Foreign Exchange Contracts       |  | $                                            | 2,912 |  |                                                             | Other Income/(expenses) |                                                           | $                                                                   | (625 | )                                                         |  | Other Income/(expenses)                                           |  |  |  | 



12



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##### Table of Contents

iGATE CORPORATION

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS  (CONTINUED)

SEPTEMBER 30, 2010 AND 2009

(Amounts in thousands)



Information on the location and amounts of derivative fair values in the Condensed
Consolidated Balance Sheets (in thousands):



|                                                                        |  |                       |                |  |                   |   |       |                       |  |  |                     |  |  |   |       | 
|----------------------------------------------------------------------- |  | --------------------- | -------------- |  | ----------------- | - | ----- | --------------------- |  |  | ------------------- |  |  | - | ----- | 
|                                                                        |  | September 30, 2010    |                |  | December 31, 2009 |  
|                                                                        |  | Balance SheetLocation |                |  | Fair Value        |   |       | Balance SheetLocation |  |  | Fair Value          | 
|Derivatives designated as hedging instruments under ASC Topic 815       |  |                       |                |  |                   |   |       |                       |  |  |                     |  |  |   |       | 
|Foreign Exchange Contracts                                              |  |                       | Current Assets |  |                   | $ | 1,595 |                       |  |  | Current Liabilities |  |  | $ | 1,317 | 
|                                                                        |  |                       |                |  |                   |   |       |                       |  |  |                     |  |  |   |       | 
|Total Derivatives designated as hedging instruments under ASC Topic 815 |  |                       |                |  |                   | $ | 1,595 |                       |  |  |                     |  |  | $ | 1,317 | 
|                                                                        |  |                       |                |  |                   |   |       |                       |  |  |                     |  |  |   |       | 

8. Fair Value Measurements

ASC Topic 820 Fair Value Measurements establishes a three-tier value hierarchy, which prioritizes the inputs used in the valuation methodologies in measuring fair value:

Level 1  Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets.

Level 2  Includes other inputs that are directly or indirectly observable in the marketplace.

Level 3  Unobservable inputs which are supported by little or no market activity.

The fair value hierarchy also requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs
when measuring fair value. In accordance with ASC Topic 820, the Company measures cash equivalents, short term investments, non convertible debentures and foreign currency derivative contracts at fair value. Cash equivalents and short term
investments are primarily classified within Level 1 or Level 2. This is because the cash equivalents and short term investments are valued primarily using quoted market prices or alternative pricing sources and models utilizing market observable
inputs. The foreign currency derivative contracts and non convertible debentures are classified within Level 2 as the valuation inputs are based on quoted prices and market observable data of similar instruments in active markets or alternative
pricing sources and models utilizing market observable inputs.



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iGATE CORPORATION

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS  (CONTINUED)

SEPTEMBER 30, 2010 AND 2009

(Amounts in thousands)



Assets and liabilities measured at fair value are summarized below:



|                                      |  |                                                             |        |  |                                                |   |        |                                         |  |   |       |  |  |   |   | 
|------------------------------------- |  | ----------------------------------------------------------- | ------ |  | ---------------------------------------------- | - | ------ | --------------------------------------- |  | - | ----- |  |  | - | - | 
|Description                           |  | September 
30,2010                                          |        |  | Fair value measurement at reporting date using |  
|                                      |  | Quoted Prices inActive 
Marketsfor IdenticalAssets(Level
1) |        |  | SignificantOtherObservableInputs(Level 2)      |   |        | SignificantUnobservableInputs(Level 3)  | 
|Assets                                |  |                                                             |        |  |                                                |   |        |                                         |  |   |       |  |  |   |   | 
|Money market mutual funds             |  | $                                                           | 92,151 |  |                                                | $ | 92,151 |                                         |  | $ |      |  |  | $ |  | 
|Foreign currency derivative contracts |  |                                                             | 1,632  |  |                                                |   |       |                                         |  |   | 1,632 |  |  |   |  | 
|Nonconvertible debentures             |  |                                                             | 3,338  |  |                                                |   |       |                                         |  |   | 3,338 |  |  |   |  | 
|                                      |  |                                                             |        |  |                                                |   |        |                                         |  |   |       |  |  |   |   | 
|Total assets                          |  | $                                                           | 97,121 |  |                                                | $ | 92,151 |                                         |  | $ | 4,970 |  |  | $ |  | 
|                                      |  |                                                             |        |  |                                                |   |        |                                         |  |   |       |  |  |   |   | 
|                                      |  |                                                            
|Description                           |  | December 31,2009                                            |        |  | Fair value measurement at reporting date using |  
|                                      |  | Quoted Prices inActive Marketsfor IdenticalAssets(Level 1)  |        |  | SignificantOtherObservableInputs(Level 2)      |   |        | SignificantUnobservableInputs(Level
 3) | 
|Assets                                |  |                                                             |        |  |                                                |   |        |                                         |  |   |       |  |  |   |   | 
|Money market mutual funds             |  | $                                                           | 67,192 |  |                                                | $ | 67,192 |                                         |  | $ |      |  |  | $ |  | 
|                                      |  |                                                             |        |  |                                                |   |        |                                         |  |   |       |  |  |   |   | 
|Total assets                          |  | $                                                           | 67,192 |  |                                                | $ | 67,192 |                                         |  | $ |      |  |  | $ |  | 
|                                      |  |                                                             |        |  |                                                |   |        |                                         |  |   |       |  |  |   |   | 
|Liabilities                           |  |                                                             |        |  |                                                |   |        |                                         |  |   |       |  |  |   |   | 
|Foreign currency derivative contracts |  | $                                                           | 1,097  |  |                                                | $ |       |                                         |  | $ | 1,097 |  |  | $ |  | 
|                                      |  |                                                             |        |  |                                                |   |        |                                         |  |   |       |  |  |   |   | 
|Total liabilities                     |  | $                                                           | 1,097  |  |                                                | $ |       |                                         |  | $ | 1,097 |  |  | $ |  | 
|                                      |  |                                                             |        |  |                                                |   |        |                                         |  |   |       |  |  |   |   | 

ASC Topic 820, Fair Value Measurements provides additional guidance on estimating fair
value when the volume and level of transaction activity for an asset or liability have significantly decreased in relation to normal market activity for the asset or liability. The ASC Topic 820 also provides additional guidance on circumstances
that may indicate that a transaction is not orderly. The application of ASC Topic 820 did not have a significant impact on earnings or the financial position for the nine months ended September 30, 2010.

In January 2010, the Financial Accounting Standards Board (FASB) issued ASU No. 2010-06, Fair Value
Measurements and Disclosures. The amendments in this ASU apply to all entities that are required to make disclosure about the recurring and nonrecurring fair value measurements. An entity is required to disclose the amounts of significant
amount of transfers in, out and valuation techniques of level 1, level 2 and level 3 fair value measurements and describe the reasons for the transfers; and also present separately the information about the purchases, sales, issuance and settlements
in significant unobservable inputs in level 3 on gross basis. The guidance provided in this ASU is effective for the first reporting period (including interim periods) beginning after issuance. The Company adopted this ASU and noted that it did not
have any impact on its consolidated financial statements.



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##### Table of Contents

iGATE CORPORATION

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS  (CONTINUED)

SEPTEMBER 30, 2010 AND 2009

(Amounts in thousands)



9. Employee Benefits

Defined Contribution Plan

The Companys eligible employees in India participate in the Employees Provident Fund (the Provident Fund), which is a defined contribution plan. The employee and the Company make
monthly contributions of a specified percentage of salary to the Provident Fund, which is administered by the prescribed authority in India. The aggregate contributions along with interest thereon are paid at retirement, death, incapacitation or
termination of employment. The Companys contribution to the Provident Fund for the three months ended September 30, 2010 and 2009 was $0.6 million and $0.5 million, respectively. The Companys contribution for the nine months ended
September 30, 2010 and 2009 was $1.8 million and $1.4 million, respectively.

401(k) Plan

Eligible United States employees of the Company participate in an employee retirement savings plan (the Plan) under
Section 401(k) of the United States Internal Revenue Code. The Plan allows for employees to defer a portion of their annual earnings on a pre-tax basis through voluntary contributions to the Plan. The Plan does not provide for any Company
matching.

Defined Benefit Plan

The Company provides for gratuity, a defined benefit retirement plan covering eligible employees in India. The plan provides a lump sum payment to the vested employees at retirement, death, incapacitation
or termination of employment subject to specified period of service, of an amount based on the respective employees salary and the tenure of employment. Liabilities with regard to the plan are determined by actuarial valuation. The
contributions are made to the Company administered trust and managed by a third party fund manager.

The following table sets
forth the net periodic cost recognized by the Company in respect of such plan.



|                                      |  |                                  |     |   |                                 |   |     |      |  |   |      |   |  |   |      |  
|------------------------------------- |  | -------------------------------- | --- | - | ------------------------------- | - | --- | ---- |  | - | ---- | - |  | - | ---- | -
|                                      |  | Three Months 
EndedSeptember 30, |     |   | Nine Months 
EndedSeptember 30, |  
|                                      |  | 2010                             |     |   | 2009                            |   |     | 2010 |  |   | 2009 |  
|Net periodic plan cost                |  |                                  |     |   |                                 |   |     |      |  |   |      |   |  |   |      |  
|Service cost                          |  | $                                | 189 |   |                                 | $ | (11 | )    |  | $ | 693  |   |  | $ | 577  |  
|Interest cost                         |  |                                  | 57  |   |                                 |   | 40  |      |  |   | 160  |   |  |   | 102  |  
|Expected return on plan asset         |  |                                  | (59 | ) |                                 |   | (35 | )    |  |   | (167 | ) |  |   | (111 | )
|Recognized net actuarial gain         |  |                                  | (9  | ) |                                 |   | (5  | )    |  |   | (15  | ) |  |   | (4   | )
|                                      |  |                                  |     |   |                                 |   |     |      |  |   |      |   |  |   |      |  
|Net periodic plan cost for the period |  | $                                | 178 |   |                                 | $ | (11 | )    |  | $ | 671  |   |  | $ | 564  |  
|                                      |  |                                  |     |   |                                 |   |     |      |  |   |      |   |  |   |      |  

10. Share-based compensation

During the three and nine months ended September 30, 2010, the Company granted 100,000 and 579,238 stock options, respectively, and nil and 250,733 restricted stock awards, respectively. During the
three and nine months ended September 30, 2009, the Company granted 820,000 and 826,000 stock options, respectively, and 130,000 and 190,750 restricted stock awards, respectively.

The dividends paid on unvested restricted stock awards are charged to compensation cost. For the nine months ended September 30,
2010 and 2009, the Company recorded $0.06 million and $0.07 million, respectively, as compensation cost for dividends paid on shares of unvested restricted stock.



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##### Table of Contents

iGATE CORPORATION

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS  (CONTINUED)

SEPTEMBER 30, 2010 AND 2009

(Amounts in thousands)



Share-based compensation expense recorded in income from operations during the three and
nine months ended September 30, 2010 and 2009 (in thousands):



|                                             |  |                                  |       |  |                                 |   |       |      |  |   |       |  |  |   |       | 
|-------------------------------------------- |  | -------------------------------- | ----- |  | ------------------------------- | - | ----- | ---- |  | - | ----- |  |  | - | ----- | 
|                                             |  | Three Months 
EndedSeptember 30, |       |  | Nine Months 
EndedSeptember 30, |  
|                                             |  | 2010                             |       |  | 2009                            |   |       | 2010 |  |   | 2009  | 
|Share-based compensation recorded in         |  |                                  |       |  |                                 |   |       |      |  |   |       |  |  |   |       | 
|Cost of revenues                            |  | $                                | 396   |  |                                 | $ | 597   |      |  | $ | 1,255 |  |  | $ | 1,715 | 
|Selling, general and administrative expense |  |                                  | 1,404 |  |                                 |   | 848   |      |  |   | 3,604 |  |  |   | 2,321 | 
|                                             |  |                                  |       |  |                                 |   |       |      |  |   |       |  |  |   |       | 
|Total share-based compensation expense       |  | $                                | 1,800 |  |                                 | $ | 1,445 |      |  | $ | 4,859 |  |  | $ | 4,036 | 
|                                             |  |                                  |       |  |                                 |   |       |      |  |   |       |  |  |   |       | 

During the three months ended September 30, 2010 and 2009, the Company issued 0.3 million and
0.4 million shares, respectively upon exercise of stock options and awards. During the nine months ended September 30, 2010 and 2009, the Company issued 0.8 million and 0.7 million shares, respectively upon exercise of stock
options and awards.

11. Other income (expense), net

Components of other income (expense) for the three and nine months ended September 30, 2010 and 2009 (in thousands):



|                                         |  |                                  |     |   |                                 |   |        |      |  |   |        |   |  |   |        |  
|---------------------------------------- |  | -------------------------------- | --- | - | ------------------------------- | - | ------ | ---- |  | - | ------ | - |  | - | ------ | -
|                                         |  | Three Months 
EndedSeptember 30, |     |   | Nine Months 
EndedSeptember 30, |  
|                                         |  | 2010                             |     |   | 2009                            |   |        | 2010 |  |   | 2009   |  
|Investment income                        |  | $                                | 873 |   |                                 | $ | 755    |      |  | $ | 2,066  |   |  | $ | 2,581  |  
|Gain on disposal of fixed assets         |  |                                  | 204 |   |                                 |   |       |      |  |   | 1,341  |   |  |   | 2      |  
|Foreign exchange loss, net               |  |                                  | (75 | ) |                                 |   | (1,249 | )    |  |   | (1,153 | ) |  |   | (5,027 | )
|Interest expense                         |  |                                  | (47 | ) |                                 |   | (18    | )    |  |   | (80    | ) |  |   | (51    | )
|Other                                    |  |                                  | 6   |   |                                 |   | 112    |      |  |   | 27     |   |  |   | 355    |  
|Gain on sale of investment in affiliates |  |                                  |    |   |                                 |   | 438    |      |  |   | 568    |   |  |   | 438    |  
|                                         |  |                                  |     |   |                                 |   |        |      |  |   |        |   |  |   |        |  
|Other income (expense), net              |  | $                                | 961 |   |                                 | $ | 38     |      |  | $ | 2,769  |   |  | $ | (1,702 | )
|                                         |  |                                  |     |   |                                 |   |        |      |  |   |        |   |  |   |        |  

12. Concentration of revenues

The following is the concentration of iGATE revenues greater than 10% by customer for the periods shown:



|                         |  |                                  |    |   |                                 |  |    |      |  |  |      |   |  |  |    |  
|------------------------ |  | -------------------------------- | -- | - | ------------------------------- |  | -- | ---- |  |  | ---- | - |  |  | -- | -
|                         |  | Three Months 
EndedSeptember 30, |    |   | Nine Months 
EndedSeptember 30, | 
|                         |  | 2010                             |    |   | 2009                            |  |    | 2010 |  |  | 2009 |  
|Royal Bank of Canada     |  |                                  | 35 | % |                                 |  | 29 | %    |  |  | 35   | % |  |  | 26 | %
|General Electric Company |  |                                  | 18 | % |                                 |  | 23 | %    |  |  | 19   | % |  |  | 24 | %

13. Commitments

Capital commitments

As of September 30, 2010, the Company has open purchase orders totaling $ 4.4 million to purchase property and equipment.

Bank guarantees

As of September 30, 2010, guarantees provided by banks on behalf of iGS to customs authorities aggregated to $0.3 million. These guarantees have a remaining expiry term of approximately one to two
years.



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##### Table of Contents

iGATE CORPORATION

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS  (CONTINUED)

SEPTEMBER 30, 2010 AND 2009

(Amounts in thousands)



Other commitments

The Companys business process delivery centers in India are 100% Export Oriented units or Software Technology Parks of India units
(STPI) under the STPI guidelines issued by the Government of India. These units are exempted from customs, central excise duties, and levies on imported and indigenous capital goods, stores, and spares. The Company has executed legal
undertakings to pay custom duty, central excise duty, levies, and liquidated damages payable, if any, in respect of imported and indigenous capital goods, stores, and spares consumed duty free, in the event that certain terms and conditions are not
fulfilled.

The Company has entered into a service agreement with a customer that provides a customer the option, exercisable
at any time by providing 60 days notice to the Company to acquire an equity stake of up to 7% of the outstanding voting shares at fair market value. The fair market value is the volume weighted average trading price of the Companys
shares on the NASDAQ National Market for five consecutive trading days immediately before the date on which the customer delivers its notice under the option. The option does not restrict the customer in any way from buying the Company shares in the
open market.

14. Subsequent Events

On October 12, 2010, our Board of Directors authorized a cash dividend of 15 cents per common share, as a partial dividend for the Companys performance for the year.

On October 20, 2010, the Company filed a shelf registration statement on Form S-3 with the U.S. Securities and Exchange Commission
(SEC). Once declared effective by the SEC, the registration statement will permit the Company to raise capital from time to time through the offer and sale of up to 10,000,000 shares of our common stock and up to $100,000,000 aggregate
principal amount of debt securities. In addition, the Form S-3 also included the registration of 6,000,000 shares of common stock held by the Companys co-founders and shareholders.

The Company has evaluated subsequent events through the date of filing the financial statements and no events, other than described
above, has occurred from the balance sheet date that would impact the Condensed Consolidated Financial Statements.



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##### Table of Contents



|ITEM 2. | MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|------- | -------------------------------------------------------------------------------------

Some of the statements in this Form 10-Q contain statements that are not historical facts and that constitute forward-looking
statements within the meaning of such term under the Private Securities Litigation Reform Act of 1995. These forward-looking statements include our financial growth and liquidity projections as well as statements concerning our plans,
strategies, intentions and beliefs concerning our business, cash flows, costs and the markets in which we operate. Without limiting the foregoing, the words believes, anticipates, plans, expects and
similar expressions are intended to identify certain forward-looking statements. These forward-looking statements are based on information currently available to us, and we assume no obligation to update these statements as circumstances change.
There are risks and uncertainties that could cause actual events to differ materially from these forward-looking statements. While we cannot predict all of the risks and uncertainties, they include, but are not limited to, our ability to predict our
financial performance, the level of market demand for our services, the highly-competitive market for the types of services that we offer, the impact of competitive factors on profit margins, market conditions that could cause our customers to
reduce their spending for our services, our ability to create, acquire and build new businesses and grow our existing businesses, our ability to attract and retain qualified personnel, our ability to reduce costs and conserve cash, currency
fluctuations and market conditions in India and elsewhere around the world, political and military tensions in India and Southern Asia, changes in generally accepted accounting principles and/or their interpretation and other risks that are
described in more detail in our filings with the Securities and Exchange Commission, including our Form 10-K (Form 10-K) for the year ended December 31, 2009.

Unless otherwise indicated or the context otherwise requires, all references in this report to iGATE, the Company, us, our, or we are to iGATE
Corporation, a Pennsylvania corporation, and its consolidated subsidiaries. iGATE Corporation, formerly named iGATE Capital Corporation, is a worldwide provider of Information Technology (IT) and IT enabled operations offshore
outsourcing services to large and medium-sized organizations. These services include client/server design and development, conversion/migration services, offshore outsourcing, enterprise resource planning (ERP) package implementation and
integration services, software development and applications maintenance outsourcing.

Website Access to SEC Reports

The Companys website is http://www.igate.com. The Companys Annual Report on Form 10-K, Quarterly Reports
on Form 10-Q, current reports on Form 8-K and any amendments to these reports are available free of charge on the Investors page of the Companys website as soon as reasonably practicable after the reports are filed electronically with the
Securities and Exchange Commission.

Business Overview

We are a worldwide outsourcing provider of IT and IT-enabled operations solutions and services. We believe our innovative approach of
integrating IT and IT-enabled operations and our ability to leverage a global delivery model provide our clients with clearly differentiated and demonstrated business value. We target large and medium-sized organizations across a diverse set of
industries, including financial services, insurance, manufacturing, media and healthcare.

Our service offerings include IT
and IT-enabled operations offshore outsourcing solutions and services to large and medium-sized organizations using an offshore/onsite model. These services include client/server design and development, conversion/migration services, offshore
outsourcing, enterprise resource planning (ERP) package implementation and integration services, software development and applications maintenance outsourcing. We also offer Integrated Technology and Operations (iTOPS)
solutions that integrate IT outsourcing and IT-enabled operations offshore outsourcing solutions and services seamlessly.

IT
services that we deliver using our offshore centers include software application development and maintenance, implementation and support of enterprise applications, package evaluation and implementation, re-engineering, data warehousing, business
intelligence, analytics, data management and integration, software testing and IT infrastructure management services. We believe that we deliver high quality solutions to our clients at a substantial savings by using our global pool of highly
talented people.

IT-enabled operations offshore outsourcing solutions and services offered include business process
outsourcing, transaction processing services and call center services. The call center services are offered to clients in several industries and are not industry specific. The transaction processing services offered are focused on the mortgage
banking, financial services, insurance and capital market industries, except for the delivery of finance and accounting functions such as accounts payable which can be performed for clients across all industries.

A majority of our clients have headquarters in North America and operate internationally. iGATE has 8,249 employees as of October 8,
2010.



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##### Table of Contents



iGATE markets its
service offerings to large and medium-sized organizations. Certain contracts are based upon a fixed price with payment based upon deliverables and/or project milestones reached. Certain contracts are time-and-materials based where contract payments
are based on the number of consultant hours worked on the project. Certain contracts with no stated deliverables have a designated workforce and are based on fixed periodic payments. Some process outsourcing contracts provide pricing per
transaction. Customers typically have the right to cancel contracts with minimal notice. Contracts with deliverables or project milestones can provide for certain penalties if the deliverables or project milestones are not met within contract
timelines.

iGATE services customers in a wide range of industries. Our largest customer is Royal Bank of Canada which
accounted for approximately 35% and 26% of revenues for the nine months ended September 30, 2010 and 2009, respectively. Our second largest customer, General Electric Company (GE), accounted for approximately 19% and 24% of revenues
for the nine months ended September 30, 2010 and 2009, respectively. iGATE is a Global Preferred Partner of GE.

Reportable Financial
Segments

The Companys Chief Executive Officer who is the chief operating decision making officer (CODM)
reviews the operations of the Company on consolidated basis. As a result of this, the Company is operating as a single reportable segment.

Critical Accounting Policies

Our critical accounting polices are
described in the summary of significant accounting policies as discussed in Note 1 of our Form 10-K.

Recently Issued
Accounting Pronouncements

In October 2009, the FASB issued ASU No. 2009-13 Revenue
recognitionMultiple deliverable revenue arrangements. The ASU provides amendments to the criteria in Revenue recognitionmultiple element arrangements for separating consideration in multiple element arrangements.
The amendments in this ASU establish a selling price hierarchy for determining the selling price of a deliverable. Further, the term fair value in the revenue guidance will be replaced with selling price to clarify that the allocation
of revenue is based on entity-specific assumptions rather than assumptions of a market place participant. The amendments in this ASU will be effective prospectively for revenue arrangements entered into or materially modified in fiscal years
beginning on or after June 15, 2010. Early adoption is permitted. The Company currently does not have multiple deliverable revenue arrangements and hence, does not expect the adoption to have an impact on its consolidated financial statements.

Results of Operations for the Three Months Ended September 30, 2010 as Compared to the Three Months Ended
September 30, 2009:



|                                    |  |                    |        |  |              |  |       |                                       |  |   |              |  |  |  |       |   |  |  |      |  
|----------------------------------- |  | ------------------ | ------ |  | ------------ |  | ----- | ------------------------------------- |  | - | ------------ |  |  |  | ----- | - |  |  | ---- | -
|                                    |  | Three Months Ended |       
|                                    |  | 2010               |        |  | 2009         |  |       | % Change ofAmountfromComparablePeriod | 
|                                    |  | Amount             |        |  | % ofRevenues |  |       | Amount                                |  |   | % ofRevenues |  | 
|Revenues                            |  | $                  | 74,845 |  |              |  | 100.0 | %                                     |  | $ | 49,055       |  |  |  | 100.0 | % |  |  | 52.6 | %
|Cost of revenues (1)                |  |                    | 45,378 |  |              |  | 60.6  |                                       |  |   | 28,897       |  |  |  | 58.9  |   |  |  | 57.0 |  
|                                    |  |                    |        |  |              |  |       |                                       |  |   |              |  |  |  |       |   |  |  |      |  
|Gross margin                        |  |                    | 29,467 |  |              |  | 39.4  |                                       |  |   | 20,158       |  |  |  | 41.1  |   |  |  | 46.2 |  
|Selling, general and administrative |  |                    | 12,056 |  |              |  | 16.1  |                                       |  |   | 9,197        |  |  |  | 18.7  |   |  |  | 31.1 |  
|Depreciation and amortization       |  |                    | 2,251  |  |              |  | 3.0   |                                       |  |   | 1,837        |  |  |  | 3.7   |   |  |  | 22.5 |  
|                                    |  |                    |        |  |              |  |       |                                       |  |   |              |  |  |  |       |   |  |  |      |  
|Income from operations              |  |                    | 15,160 |  |              |  | 20.3  |                                       |  |   | 9,124        |  |  |  | 18.6  |   |  |  | 66.2 |  
|Other income , net                  |  |                    | 961    |  |              |  | 1.3   |                                       |  |   | 38           |  |  |  | 0.1   |   |  |  | *    |  
|                                    |  |                    |        |  |              |  |       |                                       |  |   |              |  |  |  |       |   |  |  |      |  
|Income before income taxes          |  |                    | 16,121 |  |              |  | 21.6  |                                       |  |   | 9,162        |  |  |  | 18.7  |   |  |  | 76.0 |  
|Income tax expense                  |  |                    | 1,856  |  |              |  | 2.5   |                                       |  |   | 278          |  |  |  | 0.6   |   |  |  | *    | *
|                                    |  |                    |        |  |              |  |       |                                       |  |   |              |  |  |  |       |   |  |  |      |  
|Income from operations              |  | $                  | 14,265 |  |              |  | 19.1  | %                                     |  | $ | 8,884        |  |  |  | 18.1  | % |  |  | 60.6 | %
|                                    |  |                    |        |  |              |  |       |                                       |  |   |              |  |  |  |       |   |  |  |      |  



|1) | Cost of revenues is exclusive of depreciation and amortization.
|-- | ---------------------------------------------------------------

|* | As the comparable period absolute number is insignificant, the % change from comparable period is not computed.
|- | ---------------------------------------------------------------------------------------------------------------

|** | As the effective tax rate is a better comparable measure, the % change from comparable period is not computed.
|-- | --------------------------------------------------------------------------------------------------------------



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Revenues for the three
months ended September 30, 2010 increased by 52.6%, as compared to the three months ended September 30, 2009. Our revenue increase for the periods presented is directly attributable to a combination of increased business with our recurring
customers, favorable movement in currency markets and new customer wins. There was an increase in average billable headcount from 5,910 for the three months ended September 30, 2009 to 7,712 for the three months ended September 30, 2010.
Revenues increased due to the increased volume by 38.5%, increased average blended realization rate by 12.4% and favorable movement in currency markets by 1.7% for the three months ended September 30, 2010 as compared to the three months ended
September 30, 2009. Our top five customers accounted for 70.9% and 71.5% of the revenue for the three months ended September 30, 2010 and 2009, respectively.

The gross margin as a percentage of sales (gross margin percentage) was 39.4% for the three months ended September 30, 2010, as compared to 41.1% for the three months ended
September 30, 2009. The marginal difference in the gross margin percentage is due to the unfavorable movement of the US Dollar against other currencies and increase in the salary and travel costs.

Selling, general and administrative expenses (S,G&A) include all costs that are not directly associated with
revenue-generating activities. S,G&A expenses include employee costs, corporate costs and facilities costs. Employee costs include selling, marketing and administrative salaries and related employee benefits, travel, recruiting and training
costs. Corporate costs include costs such as legal, accounting and outside consulting fees. Facilities costs primarily include rent and communications costs.

S,G&A costs for the three months ended September 30, 2010 were 16.1% of revenues, as compared to 18.7% of revenues for the three months ended September 30, 2009. Our net employee cost
increased by $1.9 million for the three months ended September 30, 2010, as compared to three months ended September 30, 2009, mainly due to an increase in salaries, bonus and benefits of $1.4 million, recruitment expense of $0.1 million,
and travel expense and related costs of $0.4 million. Our net corporate cost increased by $0.4 million for the three months ended September 30, 2010 due to increase in outside professional services, legal costs, accounting, and administrative
charges which was partly offset by decrease in the provision for doubtful debts. Our net facilities costs increased by $0.6 million for the three months ended September 30, 2010, mainly due to increase in rental, maintenance and communication
related expenses.

Depreciation and amortization costs for the three months ended September 30, 2010 were 3.0% of
revenues, as compared to or 3.7% of revenues for the three months ended September 30, 2009.

Operating income was 20.3%
of revenue for the three months ended September 30, 2010 and 18.6% of revenue for the three months ended September 30, 2009. This increase was primarily due to the increased revenue and prudent management of S,G&A costs.

Other income, net is primarily comprised of the favorable foreign currency movements resulting in the realized gain on our hedges
amounting to $0.4 million for the three months ended September 30, 2010 as compared to realized loss of $1.8 million for the three months ended September 30, 2009. The unfavorable foreign currency loss related to our intercompany debt in
India and the remeasurement of the current assets denominated in the foreign currency, amounting to $0.5 million for the three months ended September 30, 2010 as compared to the favorable foreign currency gain of $0.5 million for the three
months ended September 30, 2009.Our investment income for the three months ended September 30, 2010 totaled $0.9 million as compared to $0.8 million for the three months ended September 30, 2009. The increased investments during the
current period as compared to corresponding period of the previous year yielded higher income. We recognized gain on sale of fixed assets of $0.2 million during the three months ended September 30, 2010. In September 2009, we received $0.4
million of cash from an escrow account related to the prior sale of a business. The cash received was recognized as a gain on venture investments and affiliated companies.

Our effective tax rate was 11.5% and 3.0% for the three months ended September 30, 2010 and 2009, respectively. The tax expense and the effective tax rate increased mainly due to change in the mix of
earnings among our US and international operations. iGS is eligible to claim a tax holiday on the majority of its operating income through March 31, 2011. The tax holiday has resulted in a benefit of $4.4 million and $2.8 million for the three
months ended September 30, 2010 and 2009, respectively.



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Results of
Operations for the Nine Months Ended September 30, 2010 as Compared to the Nine Months Ended September 30, 2009:



|                                    |  |                   |         |  |              |  |       |                                       |  |   |              |   |  |  |       |   |  |  |       |  
|----------------------------------- |  | ----------------- | ------- |  | ------------ |  | ----- | ------------------------------------- |  | - | ------------ | - |  |  | ----- | - |  |  | ----- | -
|                                    |  | Nine Months Ended |        
|                                    |  | 2010              |         |  | 2009         |  |       | % Change ofAmountfromComparablePeriod | 
|                                    |  | Amount            |         |  | % ofRevenues |  |       | Amount                                |  |   | % ofRevenues |   | 
|Revenues                            |  | $                 | 199,584 |  |              |  | 100.0 | %                                     |  | $ | 140,695      |   |  |  | 100.0 | % |  |  | 41.9  | %
|Cost of revenues (1)                |  |                   | 121,446 |  |              |  | 60.8  |                                       |  |   | 86,559       |   |  |  | 61.5  |   |  |  | 40.3  |  
|                                    |  |                   |         |  |              |  |       |                                       |  |   |              |   |  |  |       |   |  |  |       |  
|Gross margin                        |  |                   | 78,138  |  |              |  | 39.2  |                                       |  |   | 54,136       |   |  |  | 38.5  |   |  |  | 44.3  |  
|Selling, general and administrative |  |                   | 33,904  |  |              |  | 17.0  |                                       |  |   | 26,635       |   |  |  | 18.9  |   |  |  | 27.3  |  
|Depreciation and amortization       |  |                   | 6,599   |  |              |  | 3.3   |                                       |  |   | 5,607        |   |  |  | 4.0   |   |  |  | 17.7  |  
|                                    |  |                   |         |  |              |  |       |                                       |  |   |              |   |  |  |       |   |  |  |       |  
|Income from operations              |  |                   | 37,635  |  |              |  | 18.9  |                                       |  |   | 21,894       |   |  |  | 15.6  |   |  |  | 71.9  |  
|Other income (expense), net         |  |                   | 2,769   |  |              |  | 1.4   |                                       |  |   | (1,702       | ) |  |  | (1.2  | ) |  |  | *     |  
|                                    |  |                   |         |  |              |  |       |                                       |  |   |              |   |  |  |       |   |  |  |       |  
|Income before income taxes          |  |                   | 40,404  |  |              |  | 20.2  |                                       |  |   | 20,192       |   |  |  | 14.4  |   |  |  | 100.1 |  
|Income tax expense                  |  |                   | 3,371   |  |              |  | 1.7   |                                       |  |   | 251          |   |  |  | 0.2   |   |  |  | *     | *
|                                    |  |                   |         |  |              |  |       |                                       |  |   |              |   |  |  |       |   |  |  |       |  
|Income from operations              |  | $                 | 37,033  |  |              |  | 18.6  | %                                     |  | $ | 19,941       |   |  |  | 14.2  | % |  |  | 85.7  | %
|                                    |  |                   |         |  |              |  |       |                                       |  |   |              |   |  |  |       |   |  |  |       |  



|1) | Cost of revenues is exclusive of depreciation and amortization.
|-- | ---------------------------------------------------------------

|* | As the comparable period absolute number is insignificant, the % change from comparable period is not computed.
|- | ---------------------------------------------------------------------------------------------------------------

|** | As the effective tax rate is a better comparable measure, the % change from comparable period is not computed.
|-- | --------------------------------------------------------------------------------------------------------------

Revenues for the nine months ended September 30, 2010 increased by 41.9%, as compared to the nine months ended September 30,
2009. Our revenue increase for the periods presented is directly attributable to a combination of increased business with our recurring customers, favorable movement in currency markets and new customer wins. There was an increase in average
billable headcount from 5,987 for the nine months ended September 30, 2009 to 7,283 for the nine months ended September 30, 2010. Revenues increased due to the favorable movement in currency markets by 5.3%, increased volume by 31.2% and
increased average blended realization rate by 5.4% for the nine months ended September 30, 2010 as compared to the nine months ended September 30, 2009. Our top five customers accounted for 72.0% and 69.9% of the revenue for the nine
months ended September 30, 2010 and 2009, respectively.

The gross margin as a percentage of sales (gross margin
percentage) was 39.2% for the nine months ended September 30, 2010, as compared to 38.5% for the nine months ended September 30, 2009.

Selling, general and administrative expenses (S,G&A) include all costs that are not directly associated with revenue-generating activities. S,G&A expenses include employee costs,
corporate costs and facilities costs. Employee costs include selling, marketing and administrative salaries and related employee benefits, travel, recruiting and training costs. Corporate costs include costs such as legal, accounting and outside
consulting fees. Facilities costs primarily include rent and communications costs.

S,G&A costs for the nine months ended
September 30, 2010 were 17.0% of revenues, as compared to 18.9% of revenues for the nine months ended September 30, 2009. Our net employee cost increased by $5.2 million for the nine months ended September 30, 2010, as compared to
nine months ended September 30, 2009, mainly due to an increase in salaries, bonus and benefits of $3.4 million, recruitment expense of $0.7 million, and travel expense and related costs of $1.0 million. Our net corporate cost increased by $1.1
million for the nine months ended September 30, 2010 due to increase in outside professional services, legal costs, accounting, insurance, marketing and administrative charges which was partly offset by decrease in the provision for doubtful
debts. Our net facilities costs increased by $1.0 million for the nine months ended September 30, 2010, mainly due to increase in rental, maintenance and communication related expenses.



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Depreciation and
amortization costs for the nine months ended September 30, 2010 were 3.3% of revenues, as compared to or 4.0% of revenues for the nine months ended September 30, 2009.

Operating income was 18.9% of revenue for the nine months ended September 30, 2010 and 15.6% of revenue for the nine months ended
September 30, 2009. This increase was primarily due to the increased revenue and prudent management of S,G&A costs.

Other income, net is primarily comprised of the favorable foreign currency movements resulting in the reduction of the realized loss on
our hedges amounting to $0.6 million for the nine months ended September 30, 2010 as compared to $6.5 million for the nine months ended September 30, 2009. The unfavorable foreign currency loss related to our intercompany debt in India and
the remeasurement of the current assets denominated in the foreign currency, amounting to $0.5 million for the nine months ended September 30, 2010 as compared to the favourable foreign currency gain of $1.5 million for the nine months ended
September 30, 2009. Our investment income for the nine months ended September 30, 2010 totaled $2.1 million as compared to $2.6 million for the nine months ended September 30, 2009. In 2010, our investments have been primarily in a
dividend yielding money market mutual fund. The Net Asset Value of the units tends to decrease on payment of the dividends leading to a loss on redemption of the units which has been compensated by the dividend income. In 2009, the investments were
primarily in a high yield interest bearing fixed income securities. We recognized gain on sale of fixed assets of $1.3 million and gain on sale of investment in affiliate of $0.6 million during the nine months ended September 30, 2010. In
September 2009, we received $0.4 million of cash from an escrow account related to the prior sale of a business. The cash received was recognized as a gain on venture investments and affiliated companies.

Our effective tax rate was 8.3% and 1.2% for the nine months ended September 30, 2010 and 2009, respectively. The tax expense and
the effective tax rate increased mainly due to change in the mix of earnings among our US and international operations. iGS is eligible to claim a tax holiday on the majority of its operating income through March 31, 2011. The tax holiday has
resulted in a benefit of $11.9 million and $7.0 million for the nine months ended September 30, 2010 and 2009, respectively.

Liquidity and Capital Resources

Cash from Operations

Cash provided by operations was $31.0 million and $31.8 million for the nine months ended September 30, 2010 and
2009, respectively. Cash provided by operations has historically been our significant source of liquidity.

Cash collected
from the customers is $177.0 million as compared to $146.8 million for the nine months ended September 30, 2010 and 2009, respectively. Payments made to the vendors for operating activities are $146.0 million as compared to $115.0 million for
the nine months ended September 30, 2010 and 2009, respectively. The collections and payments have increased in 2010 as compared to 2009 due to the increased operations.

We increased our receivables by $28.2 million as of September 30, 2010 as compared to September 30, 2009. The payables and accrued liabilities increased by $14.6 million as of September 30,
2010 as compared to September 30, 2009.

Investing Activities

Cash used in investing activities for the nine months ended September 30, 2010 was $29.3 million, as compared to cash used in
investing activities of $27.7 million for the nine months ended September 30, 2009.

During the nine months ended
September 30, 2010, we sold one of our office buildings located in Bangalore, India for a consideration of $2.8 million and incurred the capital expenditure of $11.7 million. Our capital expenditures were $9 million for the nine months ended
September 30, 2009.

We have increased our investment portfolios and other investments by $21.4 million and $18.6 million
for the nine months ended September 30, 2010 and 2009, respectively.

Financing Activities

Cash used by financing activities for the nine months ended September 30, 2010 was $5.0 million, as compared to $4.6 million for the
nine months ended September 30, 2009. Dividends paid amounted to $6.1 million and $6.0 million for the nine months ended September 30, 2010 and 2009, respectively.

The Companys cash, cash equivalents and short-term investments as of September 30, 2010 were $120.8 million as compared to $96.8 million as of December 31, 2009. The Company believes that
cash generated from operations and its current cash reserves are adequate to meet the Companys reasonably foreseeable operating liquidity requirements.



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On October 12,
2010, our Board of Directors authorized a cash dividend of 15 cents per common share, as a partial dividend for the Companys performance for the year. The dividend is payable December 28, 2010, to shareholders of record as of
December 1, 2010. We intend to fund the dividend out of our current cash reserves. iGATEs Board of Directors currently intends to declare a further cash dividend in the first quarter of 2011, subject to iGATEs year-end results. No
assurance can be given as to the amounts or timing of future dividends.

We filed a shelf registration statement on Form S-3
with the U.S. Securities and Exchange Commission (SEC) on October 20, 2010. Once declared effective by the SEC, the registration statement will permit us to raise capital from time to time through the offer and sale of up to
10,000,000 shares of our common stock and up to $100,000,000 aggregate principal amount of debt securities. We do not have any immediate intentions or commitments to sell securities. The terms of any future offering of securities would be
established at the time of such offering subject to market conditions. Any offering of securities covered by the shelf registration statement will be made only by means of a written prospectus and prospectus supplement. In addition, the Form S-3
also included the registration of 6,000,000 shares of common stock held by our co-founders and shareholders.

Off-Balance Sheet Arrangements

We do not have any off-balance sheet arrangements.



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|ITEM 3. | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|------- | ----------------------------------------------------------

Market Risk Factors

Market risk factors associated with our
business are discussed in Item 7A in our Annual Report on Form 10-K for the year ended December 31, 2009. There have been no material changes from the market risk factors previously disclosed in the Companys Form 10-K.

Effect of Hypothetical Currency Rate Fluctuations

Our primary net foreign currency exposure is the Rupee. The fair value of foreign exchange contracts is subject to changes in foreign currency exchange rates.

As of September 30, 2010, the potential gain or loss in the fair value of iGS outstanding foreign currency contracts assuming
hypothetical 10%, 5%, 2% and 1% fluctuations in currency rates would be approximately:



|                       |  |                                                |        |  |                                  |   |        |                                                |  |   |        |  |  |   |        |  |  |    |        |  |    |   |        |     |  |   |        |   |  |   |        |   |  |   |        |  
|---------------------- |  | ---------------------------------------------- | ------ |  | -------------------------------- | - | ------ | ---------------------------------------------- |  | - | ------ |  |  | - | ------ |  |  | -- | ------ |  | -- | - | ------ | --- |  | - | ------ | - |  | - | ------ | - |  | - | ------ | -
|                       |  | Valuation given X% decreaseIn Rupee /
USD rate |        |  | Fair Valueas ofSeptember 30,2010 |   |        | Valuation given X% increasein Rupee /
USD rate | 
|                       |  | (10%)                                          |        |  | (5%)                             |   |        | (2%)                                           |  |   | (1%)   |  |  |   | 1%     |  |  | 2% |        |  | 5% |   |        | 10% | 
|Rupee to U.S. Rate     |  |                                                | 40.437 |  |                                  |   | 42.684 |                                                |  |   | 44.031 |  |  |   | 44.481 |  |  |    | 44.930 |  |    |   | 45.379 |     |  |   | 45.829 |   |  |   | 47.177 |   |  |   | 49.423 |  
|Derivative Instruments |  | $                                              | 13.0   |  |                                  | $ | 7.0    |                                                |  | $ | 3.7    |  |  | $ | 2.6    |  |  | $  | 1.6    |  |    | $ | 0.6    |     |  | $ | (0.4   | ) |  | $ | (3.3   | ) |  | $ | (7.7   | )

Seasonality

Our operations are generally not affected by seasonal fluctuations. However, our consultants billable hours are
affected by national holidays and vacation policies, which vary by country and by operating company.

Economic Trends
and Outlook

According to the latest report by Gartner Inc., an IT research and advisory company, the Global IT
Services industry with worldwide IT spending revised its 2010 revenue forecast to $769 billion, a 0.7 % increase from 2009 revenue of nearly $763 billion, and its 2011 revenue forecast to $788 billion, a 2.5% increase from its 2010 revenue
forecast.

With a global economic recovery widely anticipated, modest growth in IT spending is expected. The industry is
aggressively pursuing innovations that it expects to stimulate demand beyond such modest growth. A majority of our business comes from the United States and Canada. The situation has improved now with quarter on quarter revenue growth in the last
six quarters. We believe that our business model is somewhat diversified, both geographically and operationallywe serve both IT and IT enabled solutions. We believe our strategy of a global delivery model positions us well to provide a greater
breadth of services in catering to market needs and opportunities.



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|ITEM 4. | CONTROLS AND PROCEDURES
|------- | -----------------------

Disclosure Controls and Procedures

The Company maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed in the reports that the Company files or submits under the Securities
Exchange Act of 1934 is recorded, processed, summarized, and reported within the time periods specified in the SECs rules and forms, and that such information is accumulated and communicated to the Companys management, including its
Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

As of the end of the period covered by this report, the Company carried out an evaluation, under the supervision and with the
participation of Company management, including the Chief Executive Officer and the Chief Financial Officer, of the effectiveness of the design and operation of the Companys disclosure controls and procedures pursuant to the Securities Exchange
Act of 1934 (Exchange Act) Rules 13a-15(b) and 15d-15(b). Based upon, and as of the date of this evaluation, the Chief Executive Officer and the Chief Financial Officer concluded that the Companys disclosure controls and procedures
were effective. The results of managements assessment were reviewed with the Companys Audit Committee.

The
certification required by Section 302 of the Sarbanes-Oxley Act of 2002 are filed as exhibits 31.1 and 31.2, respectively, to this quarterly report on Form 10-Q.



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PART II. OTHER INFORMATION



|ITEM 1A. | RISK FACTORS
|-------- | ------------

Other than
the risk factor set forth below, there are no material changes to the risk factors previously disclosed in our Annual Report on Form 10-K for the year ended December 31, 2009.

Industry consolidation may cause us to lose key relationships and intensify competition.

Acquisitions or other consolidating transactions within our industry could harm us in a number of ways, including the loss of customers if
competitors consolidate with our current or potential customers, or our current competitors become stronger, or new competitors emerge from consolidations. Any of these events could put us at a competitive disadvantage, which could cause us to lose
customers, revenue and market share. Consolidation in our industry, or in related industries, could force us to expend greater resources to meet new or additional competitive threats, which could also harm our operating results.



|ITEM 4. | (Removed and Reserved)
|------- | ----------------------



|ITEM 6. | EXHIBITS
|------- | --------



|(a) | Exhibits
|--- | --------



|     |  |                                                                                                                                                                                                                                                                                           
|---- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|4.1  |  | Registration Rights Agreement, between iGATE Corporation and the Selling Shareholders, dated as of August 17, 2010 (incorporated herein by reference to Exhibit 4.2 to iGATE
Corporations Registration Statement on Form S-3, Commission File No. 333-170042, filed on October 20, 2010).
|     | 
|31.1 |  | Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 by the Chief Executive Officer is filed herewith.                                                                                                                                                                 
|     | 
|31.2 |  | Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 by the Chief Financial Officer is filed herewith.                                                                                                                                                                 
|     | 
|32.1 |  | Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 by the Chief Executive Officer is filed
herewith.                                                                                                                  
|     | 
|32.2 |  | Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, by the Chief Financial Officer is filed
herewith.                                                                                                                 



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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, on this 22nd day
of October 2010.



|                 |  |                                                     
|---------------- |  | ----------------------------------------------------
|                 |  | iGATE CORPORATION                                   
|                 | 
|October 22, 2010 |  | /S/    PHANEESH
MURTHY                              
|                 |  | Phaneesh Murthy Chief Executive Officer and Director
|                 | 
|                 |  | /S/    SUJIT
SIRCAR                                 
|                 |  | Sujit Sircar Chief Financial Officer                



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EXHIBIT INDEX



|     |  |                                                                                                                                                                                                                                                                                           
|---- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|4.1  |  | Registration Rights Agreement, between iGATE Corporation and the Selling Shareholders, dated as of August 17, 2010 (incorporated herein by reference to Exhibit 4.2 to iGATE
Corporations Registration Statement on Form S-3, Commission File No. 333-170042, filed on October 20, 2010).
|     | 
|31.1 |  | Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 by the Chief Executive Officer is filed herewith.                                                                                                                                                                 
|     | 
|31.2 |  | Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 by the Chief Financial Officer is filed herewith.                                                                                                                                                                 
|     | 
|32.1 |  | Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 by the Chief Executive Officer is filed
herewith.                                                                                                                  
|     | 
|32.2 |  | Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 by the Chief Financial Officer is filed
herewith.                                                                                                                  



28