Share drop as EDS misses profit target

Share drop as EDS misses profit target

US supplier hopes significant fourth-quarter contract wins will revive fortunes

EDS's fourth-quarter profit fell 13 percent to $189m (£97m) due to a fall in contract signings and the loss of its US Verizon Communications deal.

And though full-year 2007 profits rose 52 per cent to $716m (£367m), the firm's shares fell six per cent on the New York Stock Exchange on publication of its figures yesterday.

EDS signed $6.1bn (£3.1bn)-worth of deals in the fourth quarter, compared with $7.6bn (£3.9bn) in the same period a year ago. But it hopes significant contract wins in the coming quarter will revive its fortunes.

Some big US prorgrammes - including Bristol-Myers Squibb infrastructure services, a Medicaid contract extension with the State of Indiana, and an IT services contract with Continental Airlines - will all boost performance in 2008.