UPDATE 2-Sapient Q1 earnings rise, sees weak first quarter

* Q4 EPS $0.20 vs. est. $0.10 * Q4 service revenue up 6 pct to $164.7 mln

* Sees Q1 service rev $140 mln-$145 mln vs. est. $174.5 mln * CEO: January off to a "terrible start" (Adds details)

Feb 19 (Reuters) - Sapient Corp (SAPE.O), a provider of business and technology consulting services, reported a better-than-expected quarterly profit, helped by higher service revenue, but forecast a weak first quarter as firms cut down spending.

"Overall budgets look to be down nearly across the board. We are even seeing a few clients budget month to month in this environment based on uncertainty," Sapient Chief Executive Alan Herrick said in a conference call with analysts.

For the first quarter, the company forecast service revenue of $140 million to $145 million, well blow analysts' expectations of $174.5 million.

Sapient did not get the start it had hoped for in 2009 and January specifically was "virtually frozen," Herrick said in the call.

The company reported fourth-quarter earnings of $25.7 million, or 20 cents a share, compared with earnings of $9.2 million, or 7 cents a share in the year-ago period.

Service revenue for the quarter rose 6 percent to $164.7 million.

Analysts, on average, were expecting earnings of 10 cents a share, before items, on revenue of $171.2 million, according to Reuters Estimates.

Sapient, which competes with Accenture Ltd (ACN.N) and Perot Systems Corp PER.N, said it expects to continue to hire in 2009 in targeted areas, including trading and risk management, marketing services and government services.

Earlier this month, it reduced about 8 percent of its workforce, or about 500 employees, primarily across its North America and India operations. [ID:nBNG421802]

Shares of the company closed at $3.46 Thursday on Nasdaq. (Reporting by Bijoy Koyitty in Bangalore; Editing by Saumyadeb Chakrabarty)