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January 14, 1988

CAUTIOUS DEC OUTSTRIPS UNISYS TO TAKE THIRD PLACE BEHIND IBM, FUJITSU

By CBR Staff Writer

Commenting on the company’s first half figures – net up 32% at $599.5m on turnover up 23% at $5,312m (see Company Results), president Kenneth Olsen says We are gratified that revenues continue to grow at a rate which indicates market share gains. Business overall is firm and our international business remains quite strong. Some of the industry sectors that performed particularly well in the quarter include health care, electronics, aerospace, retail, financial services, and state and local government. James Osterhoff, vice president of finance said, We entered this fiscal year with an aggressive growth plan and we remain essentially on that plan. In light of the uncertainties relative to the economy over the next several months, we have become more cautious regarding new investment commitments for the second half in order to protect profitability. The company indicated that growth was strongest at the low end, citing the MicroVAX and VAXstation lines, which it says continue to find broad appeal across many industries and geographies as workstations, servers and in Local Area VAXclusters. The newly announced MicroVAX and VAXstation 3000 products were greeted enthusiastically by customers and volume shipments will begin in the third quarter. DEC also said that the VAX 8250 and 8350 systems continue as popular entry-level VAXcluster products. The top-end should get a fillip with launch of the new multiprocessor machine that is expected this month. The figures were about in line with analysts’ forecasts and were not greeted with much enthusiasm, since although there was a sharp rise in fiscal second quarter profits, much of this was down to a lower tax charge. Comparing DEC’s first half turnover with the comments by Michael Blumenthal of Unisys alongside, DEC has now almost certainly sailed past Unisys as the clear Number Two among US computer manufacturers behind IBM, although the diminishing dollar ensures that it will remain in third place in the world ranking behind Fujitsu Ltd of Japan.

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