Boston, MA 04/23/2014 (wallstreetpr) – Unisys Corporation (NYSE:UIS) is a $1.14 billion organization that provides global information technology solutions. Its products include software than enable clients to achieve efficiency and security around their operations while delivering the best experience to end users. The company also provides outsourcing services.
However, even with the diversified business model, the company failed to attain success in the recent quarter. As with the previous quarters, the company ended up in losses and deep in the red this time around.
As if to add salt to injuries, the company stated that it expects performance in the future quarters to face challenges, as well. The challenges, the company said, will come from the soft demand for technology and outsourcing solutions amid reduced spending by its clients and intensive competition in the industry.
The gloomy prediction as well as the lackluster first quarter data sent shares tumbling.
Deep in the red
Unisys Corporation (NYSE:UIS) sank deep in the red in the latest quarter. The company reported 2014 first quarter net loss of $53.5 million or $1.15 per share. That compared with a net loss of $33.9 million or $0.77 per share in the comparable quarter a year earlier.
The widened of losses in the latest quarter was primarily due to a significant drop in revenue as the company tried to successfully curb expenses in the quarter.
Without one-time impacts, loss in the latest quarter came in at $0.74 per share against a loss of $0.26 per share a year ago.
Revenue in the quarter came in at $761.7 million, suggesting a drop of 6 percent from $809.9 million generated in the comparable quarter of 2013. The drop in revenue cut across the company’s various segments and markets. However, the revenue decline in the international market was more severe at 7 percent against 5 percent decline in the U.S.
The revenue in the Services division was $690.9 million, suggesting a year-over-year decline of 4 percent. The decrease in revenue in the Services business was linked to the fall in demand for outsourcing solutions. As if that was not enough, Unisys Corporation (NYSE:UIS) also witnessed profit margin decline in the segment. Gross profit margin fell from 17.4 percent to 15.8 percent.
Trouble catches up with IT
The downfall in the market did not spare the Unisys Corporation (NYSE:UIS)’s information technology segment where revenue declined 19 percent to $70.8 million. The lower revenue was due to the soft sales as clients kept their wallets zipped. Besides the fall in demand in the segment, gross profit margin also tumbled, dropping from 45.8 percent to 42.5 percent.
