EDS Posts 12% Revenue IncreaseEDS Posts 12% Revenue Increase

On the strength of a robust IT outsourcing market, EDS last week reported a 12% increase in revenue for 2001, and a 13% revenue increase for the fourth quarter of 2001, ended December 2001.

For 2001, the service provider had net earnings of $1.36 billion on $21.54 billion in revenue, up from $1.14 billion in net earnings on $19.23 billion in revenue for 2000. For the fourth quarter of 2001, EDS's net earnings were $405 million on $5.9 billion in revenue, compared with net earnings of $321 million on $5.2 billion in revenue for the fourth quarter of 2000.

Fourth-quarter and full-year 2001 contract signings were $10.1 billion and $31.4 billion, respectively, down from year-ago signings of $15.8 billion and $32.6 billion, which were heavily weighted by the $6.9 billion Navy and Marine Corps Intranet contract.

EDS' largest contract for the quarter was a five-year, $1.5 billion IT outsourcing contract extension that will have EDS hosting Xerox Corp.'s IT operations and providing application development and management services worldwide through 2009.

The service provider's biggest soft spot is its A.T. Kearney management-consulting unit, which accounts for about 5 percent, or roughly $1 billion, of EDS's revenue. A.T. Kearney followed the consulting market's downward trend, its revenue declining 12% for the fourth quarter.