EDS Refocuses Amid Falling Profits; Services Help CA - InformationWeek

InformationWeek is part of the Informa Tech Division of Informa PLC

This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them.Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 8860726.


EDS Refocuses Amid Falling Profits; Services Help CA

EDS yesterday reported revenue of $4.3 billion for the firstquarter, compared with $3.9 billion for the year-agoquarter, and a net loss for the quarter of $20.6 million,compared with $184.2 million in net income for the samequarter a year ago. The IT services provider took a $379.8million pre-tax charge in the first quarter to account for5,200 layoffs that will be completed by June, consolidationof operations, write-down of assets, and discontinuance ofsome lines of business.

To turn the company around from a long string of earningsand revenue growth disappointments, EDS executives outlineda $1 billion cost-cutting effort and a new business strategyemphasizing E-business services. A new unit focused on E-business has been created by bringing together a number ofservice offerings from throughout EDS. E-business offeringsinclude EDS outsourcing and subsidiary A.T. Kearney'sconsulting services, and range from Web design to onlinefinancial transaction processing and security. Prior toreleasing results, EDS slipped 1-13/16 to 51-5/16.

Also yesterday, Computer Associates said it expects recordrevenue for its fourth quarter, ended March 31, and an 11%revenue increase over last year for its fiscal year 1999.Revenue in the fourth quarter is expected to be about $1.63billion, up from $1.47 billion the same time a year ago. Its1999 annual revenue is estimated to be $5.25 billion,compared with $4.72 billion reported in fiscal year 1998.

CA president and chief operating officer Sanjay Kumarpointed to strong growth in CA's client-server business,which is driven by its Unicenter TNG enterprise-managementproduct line. Kumar also noted a healthy increase in thecompany's professional services revenue. The results arepreliminary in nature, pending completion of CA's regularyear-end audit; full results are scheduled for release on orbefore May 28, the company said. Before making the pre-earnings announcement, CA closed up 2-7/16 to 42-3/8.

We welcome your comments on this topic on our social media channels, or [contact us directly] with questions about the site.
Comment  | 
Print  | 
More Insights
2021 State of ITOps and SecOps Report
2021 State of ITOps and SecOps Report
This new report from InformationWeek explores what we've learned over the past year, critical trends around ITOps and SecOps, and where leaders are focusing their time and efforts to support a growing digital economy. Download it today!
InformationWeek Is Getting an Upgrade!

Find out more about our plans to improve the look, functionality, and performance of the InformationWeek site in the coming months.

Remote Work Tops SF, NYC for Most High-Paying Job Openings
Jessica Davis, Senior Editor, Enterprise Apps,  7/20/2021
Blockchain Gets Real Across Industries
Lisa Morgan, Freelance Writer,  7/22/2021
Seeking a Competitive Edge vs. Chasing Savings in the Cloud
Joao-Pierre S. Ruth, Senior Writer,  7/19/2021
Register for InformationWeek Newsletters
Current Issue
Monitoring Critical Cloud Workloads Report
In this report, our experts will discuss how to advance your ability to monitor critical workloads as they move about the various cloud platforms in your company.
White Papers
Twitter Feed
Sponsored Live Streaming Video
Everything You've Been Told About Mobility Is Wrong
Attend this video symposium with Sean Wisdom, Global Director of Mobility Solutions, and learn about how you can harness powerful new products to mobilize your business potential.
Sponsored Video
Flash Poll