Innovate the Future

Original Web Article: Unisys surprises analysts with 2Q profit

Review Summary: 
Unisys (NYSE:UIS)’ positive results should not really be a surprise. Ed Coleman is the right guy and they are making the right moves.

Review/Analysis:  
Unisys needed to shift more aggressively from a technology company to a services company. Ed Coleman, the new Chairman and CEO, is the right leader for the job.

Coleman is slashing costs at Unisys by more than $225 million annually.

Unisys’ services side is primarily outsourcing and consulting with a focus on secure computing. They have extensive experience in governments and law enforcement. But, for Unisys to remain a player in the enterprise space and to penetrate the SMB space more effectively, they needed something that would distinguish them from HP (NYSE:HPQ)/EDS (NYSE:EDS) and IBM (NYSE:IBM). 

In response, Unisys announced the Secure Cloud. The perfect cloud computing solution that addresses the number one fear of everyone that looks at cloud computing: security. How do I keep my business data safe. Unisys has the best solution at this time.

Also, Unisys’ cloud offering goes beyond anything that HP or IBM are deploying. With Unisys’ global data centers they are perfectly positioned to offer the full gambit of cloud computing layers. These include Infrastructure as a Service (IAAS), Platform as a Service (PAAS) and Software as a Service (SaaS). Unisys has gone one better still by defining Application as a Service (AaaS).

By offering the ‘whole enchilada’ of cloud computing, Unisys sets themselves apart from Amazon (NASDAQ:AMZN), Google (NASDAQ:GOOG), HP, IBM and all the other current players. In addition, utilization of their data centers for cloud computing and the deployment of full virtualization will allow them to lower their overall data center costs significantly while increasing the revenue per server. It will also allow Unisys to be a major player in the expansion of IT sales into the SMB space where the products have traditionally been too expensive. Cloud computing will greatly lower the cost of entry for SMBs. New, simplified Enterprise Resource Planning (ERP) solutions from companies like Epicor (NASDAQ:EPIC) (and potentially with Oracle (NASDAQ:ORCL) Fusion products) bring mainstream IT functionality to the SMBs.

In addition, Unisys is making great alliances with companies like Dell (NASDAQ:DELL). Dell is attacking the SMB space with partner ATT (NYSE:T) through Dell’s ProManage program. Unisys stands to benefit greatly.
Unisys’ positive numbers should not have been a surprise. All the signs were there. Ed Coleman will make many more changes. Look for Unisys to do very well going forward.
 

David Croslin
President, Innovate the Future, Inc.
david@innovatethefuture.com
www.innovatethefuture.com
www.davidcroslin.com