Net income for Computer Sciences Corp. (NYSE: CSC) fell to $42 million, or 26 cents per share, from $183 million, or $1.17 per share, in the same period of last year. And the company reported that revenue fell 1.9% to $3.96 billion. But analysts polled by Thomson Reuters had expected to see EPS of $0.22 on revenue of $3.89 billion.
On the upside, the IT provider announced that it had strong new bookings of $4.0 billion, and the operating margin of 4.6% increased by 16 basis points from the previous year. The operating cash flow of $221 million for the quarter was an improvement of $267 million from the previous year, and free cash flow of negative $25 million for the quarter was an improvement of $378 million over the previous year.
Mike Lawrie, president and CEO said:
We have launched several action plans which will transform the company over the next several years and create value for our shareholders. As part of this transformation agenda, we are bringing a much needed focus to greater contract management discipline across the company. We are also simplifying our operating model to realize greater productivity and operational efficiency. We are attacking our cost structure and we expect to realize about $1 billion in cost improvement over the next 18 months.
Shares jumped more than 13% in early trading to around $29.00. The 52-week trading range is $22.19 to $33.80. Thomson Reuters had a consensus analyst price target of $26.65 before this news.