Unisys has reported a decline in overall sales in the third quarter of 2005, with a preliminary net loss of $US54.3 million, which includes a pre-tax charge of $10.7 million.
Revenue for the third quarter of 2005 declined 4 percent, to $1.39 billion from $1.45 billion during the same quarter last year.
Unisys president and CEO Joseph McGrath said the company will take action in the form of focused investments, divestitures, cost reduction and sales and marketing exercises.
McGrath said this will position Unisys as a major player in large, fast-growing market areas and should enable the company to grow at or above industry growth rates, expand margins and profitability and position Unisys as a leader in chosen market segments.
"We are disappointed by these results, and we are taking decisive actions to accelerate our repositioning efforts," McGrath said.
"These actions, which are beginning now and will roll out through 2006, will enable us to focus our resources on high growth, high return market segments, reduce costs, and drive profitable revenue growth.
"As these actions take hold, we believe they will enable us to build our financial momentum and result in significantly improved profitability."
Unisys plans to focus resources on what it considers to be high-growth areas such as outsourcing, open source/Linux, Microsoft solutions and security, as well as selling non strategic areas of business, and using the proceeds to implement cost reductions and for acquisitions.
Unisys will also reduce its global workforce by 10 percent over the next year. The vendor said the financial results in the quarter showed a weakness in its high-end server business as clients deferred on transactions the company had expected to close in this quarter. On the services side, margins were affected by lower than expected revenue, under utilization of personnel, higher implementation costs in project-based businesses and issues in two outsourcing operations.
Services revenue grew 2 percent. Customer revenue in the technology segment declined 29 percent.