EDS has now posted eight consecutive quarters of double-digit EPS growth. The 56 cents EPS result excludes the net positive, cumulative effect of a change in an accounting principle and a related one-time investment gain.

For the first quarter, base (non-GM) revenue grew by 17 percent on a constant currency and organic basis versus a year ago. Total first quarter revenue was $5.0 billion.

Contract signings increased 67 percent to $7.5 billion for a record ninth straight quarter.

EDS’ momentum continues in 2001, buoyed by accelerating revenue growth, said Dick Brown, chairman and CEO. Despite a challenging world economy, EDS’ performance was strong in the quarter. This is supported by our record contract signings, double-digit base revenue and earnings growth, and improved margins.

Contract signings continued at a strong pace around the world, particularly in the U.S. where the total value of signings increased 83 percent from a year ago. EDS’ strategic infrastructure business segment, Information Solutions, was at the forefront of the company’s growth, posting a 99 percent increase in total contract value and a 20 percent increase in base revenue versus the year-ago quarter.

EDS also has had solid revenue contributions from its Consulting and Business Process Management segments. Consulting revenues rose 11 percent in the quarter, driven by a 38 percent increase in E.solutions. Business Process Management base revenues improved by 9 percent compared to a year ago.

EDS has seen no slowdown in our overall market, said Brown. Companies around the world are continuing to invest in the information technology segments we serve to boost their productivity. Our pipeline of new business opportunities continues to expand to record levels. Our growing backlog of signed business, which is more than four times annual revenues, gives us confidence in our ability to continue to deliver on our commitments to shareholders.

Productivity increases continued to drive significant cost and expense savings in the quarter. Operating margin improved for the eighth consecutive quarter on a comparable year-over-year basis. Our continued productivity focus provided the resources needed to expand our capabilities and extend our market reach, as evidenced by our recently announced acquisitions of German IT services firm Systematics and Sabre’s IT outsourcing business, said Brown.

First quarter EPS, excluding one-time items, up 19 percent vs. comparable first quarter 2000 results.

Operating margin, 8.9 percent in the first quarter, 70 basis points higher than in the year-ago period.

Base revenue grew by 17 percent in the quarter on both a constant currency and an organic basis. Organic revenue growth excludes the impact of currency, acquisitions and divestitures.

Base revenue, as reported, grew by 13 percent in the first quarter.

Total revenue grew 9 percent in the first quarter and 13 percent at constant currency, reflecting a 7 percent (6 percent at constant currency) decline in GM revenues.

First quarter return on net assets was 12.7 percent, a 60 basis point improvement over the same period in 2000.

First quarter return on equity was 20.6 percent, an 80 basis point increase from the same period in 2000.

Contracts

Reflecting a robust IT services market and a global sales force now at full strength, EDS signed $7.5 billion in contracts in the first quarter including:

A $2.2 billion, 10-year service contract to manage Sabre’s IT systems. EDS also agreed to acquire Sabre’s airline outsourcing business, which had a revenue stream of about $600 million last year. This transaction, when completed, will make EDS the No. 1 IT service provider for the airline industry.

A $475 million contract with Blue Shield of California to provide mainframe processing, data storage, applications management, imaging, network, desktop and computer management services. This contract builds on a relationship spanning four decades.

A $350 million contract with DecisionOne, the largest independent provider of multivendor computer support services in North America, to manage internal information technology. DecisionOne’s clients include more than half of the Fortune 1000.

A $300 million, five-year contract with Telstra, Australia’s largest telecommunications company, to provide software maintenance and development for its billing functions and shared services. In the quarter, the total value of EDS’ signings in Asia Pacific rose by more than 90 percent versus a year ago.

A $156 million contract to manage CIBC’s human resource operations and technology services. CIBC is the first major financial institution in Canada and among the first in North America — to team up with an external supplier to manage its human resource operations and technology services. CIBC is the first customer for EDS’ new Human Resources Management service offering.

A $138 million e-government contract for the top-to-bottom redesign and management of the Ontario government’s network services. The global government IT services market is estimated at $55 billion in 2001, growing in the mid-teens.

Services Offerings

Focusing on the most promising growth opportunities in the digital economy, including information assurance, mobility, customer relationship management (CRM) and electronic commerce:

EDS launched its Cyber Security Institute — a computer security curriculum to arm IT professionals and consumers with skills to battle hackers, security breaches and viruses.

Working with Cisco, EDS launched its Managed Wireless Local Area Network, an industrial-strength broadband wireless network and services connecting employees and business travelers through voice, video and data transmission — with groundbreaking reliability, quality, security and global reach.

EDS expanded its Digital CRM Solutions to Europe, where the CRM services market is estimated to grow to $34 billion within three years.

A.T. Kearney, working with E.solutions, has expanded its relationship with the Federation Internationale de Football Association (FIFA), soccer’s global governing body, from an e-business strategy engagement to several e-business implementation projects.

Alliances

EDS continued to extend its market reach and expand its capabilities through alliances, including the following:

In collaboration with Microsoft, Compaq and Intel, EDS has added a Microsoft-based enhanced high-availability Web hosting service to its current offering.

In hosting and application services, a market estimated to reach at least $65 billion by 2004, SAP America Inc. selected EDS to be a Preferred Data Center to provide SAP® software to its customers in a hosted environment.