EDS Profit Slips On Job Charge, But Revenue Gains

EDS Profit Slips On Job Charge, But Revenue Gains

Electronic Data Systems Corp (NYSE:EDS), the second-largest technology outsourcing company, Wednesday posted a lower quarterly profit on costs for cutting jobs, but revenue increased.

Fourth-quarter net income fell to $189 million, or 36 cents per share, from $217 million, or 40 cents per share, a year earlier. EDS had costs of $154 million for an early retirement program offered to 12,000 employees last year.

Revenue rose to $5.83 billion from $5.7 billion. Excluding the job-related costs and other items, profit was 55 cents per share, shy of the average analyst estimate of 57 cents as compiled by Reuters Estimates.

Analysts expected revenue of $5.86 billion. The company in November gave a full-year revenue forecast implying fourth-quarter projected revenue of $5.7 billion to $6.2 billion.

EDS, the largest technology services provider after International Business Machines Corp, in November also forecast 2007 earnings of $1.55 to $1.60 a share before items, or fourth-quarter earnings of 55 cents to 60 cents per share.

EDS shares, down 6.7 percent this year through Tuesday, closed up 1.4 percent at $19.61 on the New York Stock Exchange Wednesday. They trade at about 12 times expected 2008 earnings per share, compared with IBM's multiple of 13.