Unisys reports year-to-year corporate and services growth in 1Q12; portfolio enhancements position the firm for growth in the upcoming quarter

Despite continued challenges in the U.S. Federal market, 1Q12 marked the second out of three consecutive quarters where Unisys reported year-to-year growth in both corporate and services revenue. Corporate revenue of $928.4 million increased year-to-year by 1.9% while Unisys’ services revenue of $823.0 million improved 2.8% from the year-ago quarter. Unisys’ services revenue increased 7%, excluding the U.S. Federal sector. TBR attributes Unisys services revenue growth to cloud-related signings spanning both the commercial and public sector markets, indicating the firm is benefiting from recent cloud investments.

Unisys continues to invest in high-growth areas such as mobility, cloud and social computing to position itself for future growth. In their earnings call, Unisys reported an expected $700 million to be recognized from Unisys’ $5.4 billion backlog, supporting 2Q12 revenue growth. Although Unisys completed the sale of its African business in 1Q12, TBR expects the firm to continue to earn revenue from the region through channel partners, while supporting international revenue growth from emerging markets such as India and China. With its investments and offerings, TBR expects Unisys’ services operating margin to be between 7% and 7.5% in 2012.

Unisys expands its application modernization portfolio to include new offerings and increase the addressable market

With mission-critical workloads increasing in size and complexity while IT budgets tighten, Unisys released its Application Modernization Platform as a Service (AMPS) Service Oriented Architecture (SOA) to help clients improve functionality and efficiency in IT environments. The offering is available to both public sector and commercial organizations and is accompanied by the 1Q12 launch of an AMPS Center of Excellence (COE). As public sector and enterprise customers migrate to virtual environments, they are seeking application modernization and migration services to update their legacy applications and move them to new and/or updated virtual infrastructures. Unisys is addressing this growing need.

Unisys is well positioned to grow its share in the cybersecurity market, winning bids over commercial- and government-centric peers

TBR believes Unisys’ significant presence in both the commercial and public sectors enables the company to leverage best practices across the market segments, penetrating further into new and existing accounts. Unisys’ cybersecurity solutions focus on the mission-critical aspects of its customers’ businesses. Unisys is gaining traction with its Stealth Solution for Secure Virtual Terminal (SSVT), a Stealth USB-based Device. Along with the solution, Unisys provides a wide array of services, including installation, integration and training as well as on-site support specialists, support consulting, and enterprise multi-vendor support, making a compelling argument for utilizing Unisys to address security issues.

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