Sales Up, Profits Down At ACS - 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.

IoT
IoT
IT Leadership // IT Strategy

Sales Up, Profits Down At ACS

Dallas-based outsourcer reports mixed results for second quarter.

Technology outsourcer Affiliated Computer Services on Thursday reported mixed results for its second quarter.

Sales during the period increased 7% year over year to $1.6 billion, but net income slumped 7.5% to $75.5 million. Earnings per share declined 5%, to 77 cents.

Wall Street analysts surveyed by Thomson Reuters, on average, were looking for EPS of 79 cents.

For the third quarter, ACS said it expects to post EPS of between 92 cents and 95 cents.

"ACS has a recession-resistant model that performed well again this quarter," ACS president and CEO Lynn Blodgett said in a statement. "We have also undertaken several initiatives that will further increase the resiliency of our business. We are proactively managing the business to take advantage of opportunities in this market."

During the quarter, ACS signed outsourcing contracts worth a total of $853 million, with recurring annual revenue of $202 million. The quarter also saw the company acquire Grupo Multivoice for an undisclosed sum. Argentina-based Grupo Multivoice provides a range of business process outsourcing services.

Tech services appear to be holding up reasonably well despite the recession. On Wednesday, business software specialist SAP reported that sales of software-related services increased 8%. "The services pipeline doesn't look too bad," said Bill McDermott, SAP's president of global field operations, in an interview.

Product sales, however, are taking a hit from the downturn. SAP's software sales fell 7% year over year. Last week, Microsoft reported that sales of the Windows operating system declined 8%, while sales of Microsoft Office to consumers plunged 23%. Microsoft said it would lay off 5,000 full-time employees in order to deal with the recession.

Shares of ACS were up 6.13% to $47.47 in midmorning trading Friday.

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
News
Think Like a Chief Innovation Officer and Get Work Done
Joao-Pierre S. Ruth, Senior Writer,  10/13/2020
Slideshows
10 Trends Accelerating Edge Computing
Cynthia Harvey, Freelance Journalist, InformationWeek,  10/8/2020
News
Northwestern Mutual CIO: Riding Out the Pandemic
Jessica Davis, Senior Editor, Enterprise Apps,  10/7/2020
White Papers
Register for InformationWeek Newsletters
Video
Current Issue
[Special Report] Edge Computing: An IT Platform for the New Enterprise
Edge computing is poised to make a major splash within the next generation of corporate IT architectures. Here's what you need to know!
Slideshows
Flash Poll