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Computer Sciences Corporation

Computer Sciences Corporation (CSC) was an American multinational information technology services company founded in April 1959 in Los Angeles, California, by Roy Nutt and Fletcher Jones with initial capital of $100.^[1]^[2] The firm initially focused on providing programming tools such as assemblers and compilers for early computers, marking it as a pioneer in commercial software development.^[3] By 1963, CSC had become the largest software company in the United States and the first to list on a U.S. stock exchange, achieving rapid growth through software services and systems integration for government and commercial clients.^[2]^[4] Over its history, CSC expanded into IT consulting, outsourcing, and managed services, serving sectors including defense, healthcare, and finance, but faced notable setbacks such as multibillion-dollar losses from a failed UK National Health Service contract in the 2000s and subsequent SEC charges in 2015 for accounting manipulations that overstated profits by ignoring standards on contract risks.^[5]^[6] These issues contributed to financial distress, prompting a 2015 spin-off of its U.S. public sector business into CSRA Inc. and aggressive turnaround efforts under CEO Mike Lawrie.^[7] Ultimately, CSC merged with Hewlett Packard Enterprise's Enterprise Services division in 2017 to form DXC Technology, ending its independent operations.^[8]^[4]

History

Founding and Early Years (1959–1969)

Computer Sciences Corporation (CSC) was established in April 1959 in Los Angeles, California, by Roy Nutt, a data processing expert formerly with United Aircraft Corporation, and Fletcher Jones, who had directed proprietary software development at North American Aviation.^[9] The founders started with $100 in capital, focusing on the unmet demand for specialized software in the nascent computer industry, including assemblers, compilers, operating systems, and programming services supplied to manufacturers such as IBM, Honeywell, and Univac.^[9] This emphasis on software tools positioned CSC as an early innovator amid the aerospace-driven computing boom of the Cold War era.^[10] By 1963, CSC had grown into the largest software company in the United States and became the first in its sector to list on a national stock exchange, reflecting rapid talent attraction and a free-thinking corporate culture under Jones's leadership as chairman and CEO.^[11] The firm secured its initial government contracts in the early 1960s, leveraging founders' aerospace backgrounds, with a major milestone in June 1966 when it won a $5.5 million NASA contract to support a computational laboratory in Huntsville, Alabama.^[9] Further expansion in 1967 included high-value agreements with the Atomic Energy Commission and the U.S. Army, solidifying CSC's role in defense and scientific computing.^[11] Pioneering multi-programming and real-time computing integrations of computers with communications systems drove technical advancements, while proprietary products like the 1965 Computax system for automated tax calculations (in which CSC held a 38% stake) diversified revenue.^[9] ^[11] Financial performance accelerated, with profits of $2.7 million in 1965 and sales reaching $80 million alongside $6.8 million in profits by 1968, the year CSC went public as the first pure software firm to do so.^[9] That same year, the company launched Computicket for computerized ticketing, and in 1969, it announced plans for Infonet, a nationwide data communications network.^[9]

Expansion and Commercial Growth (1970–1989)

During the early 1970s, Computer Sciences Corporation (CSC) experienced a surge in business but faced pressures to diversify beyond its core programming services, as major computer manufacturers expanded their internal programming capabilities, reducing demand for external providers.^[9] In 1970, CSC secured a contract with New York City's Offtrack Betting Corporation, marking an entry into commercial applications, though it also incurred a $12.7 million write-off related to its Computicket system.^[9] By 1972, revenues reached $127.5 million, with approximately 90% derived from services, but the company absorbed a $62.8 million write-off on its Infonet data communications network and dealt with the death of co-founder Fletcher Jones.^[9] Growth stabilized through government contracts, including a profitable agreement with the U.S. General Services Administration (GSA) in 1972, though profitability eroded by 1977.^[9] Sales climbed to $220 million by 1975, yielding $7 million in profits, but external shocks like the 1979 Iranian Revolution contributed to a $1.9 million loss that year.^[9] CSC's Infonet subsidiary, providing packet-switched data networking, grew to represent 50% of total sales by 1980, when overall revenues hit $600 million.^[9] The 1980s marked accelerated commercial expansion, with revenues reaching $723.5 million in fiscal 1985.^[12] Key contracts included a $45.6 million NASA agreement in 1981 and a $20 million Tennessee Medicaid processing deal that same year.^[9] By 1986, revenues approached $1 billion, bolstered by a $278 million U.S. Customs Service contract for automating import processing.^[9] Acquisitions supported growth, such as the $20 million purchase of Computer Partners Incorporated in 1986, a Boston-based firm specializing in custom software design.^[9] In 1988, sales exceeded $1.2 billion, driven by a $186 million U.S. Air Force contract for logistics support systems.^[9] CSC began emphasizing commercial markets, forming a dedicated commercial-systems group in 1989 and acquiring Index Group Inc., a technology consulting firm, to enhance strategic IT advisory capabilities.^[9] This period also saw initial international pushes, including contracts in finance and defense sectors in Europe and Australia, though government work remained dominant, comprising roughly half of revenues in the 1970s.^[4]

Global Reach and Acquisitions (1990–2006)

During the 1990s, Computer Sciences Corporation (CSC) accelerated its international expansion by targeting acquisitions that provided entry into foreign markets, particularly Europe, while diversifying beyond U.S. government contracts into commercial outsourcing and consulting services. This strategy contributed to robust growth in non-U.S. revenues, with global commercial operations expanding by 26% in fiscal 1997 compared to the prior year. By the late 1990s, CSC employed over 40,000 people across hundreds of offices worldwide, reflecting a deliberate push into regions like the United Kingdom and Australia to capitalize on emerging demand for IT infrastructure and systems integration.^[13]^[4] Key acquisitions underscored this global orientation. In 1990, CSC purchased Inforem, a UK-based firm specializing in financial services software, which enhanced its European software and services capabilities. The company invested over $100 million in acquisitions during 1991 to further build industry expertise and market access. A landmark deal occurred in April 1996 with the $1.4 billion acquisition of The Continuum Company, a major UK outsourcing provider, significantly boosting CSC's international systems management and application services footprint. Subsequent purchases in 1997 included Planmetrics, a U.S.-based energy consultancy with global implications, and Pinnacle Group, expanding consulting depth.^[10]^[1]^[4]^[13] Into the early 2000s, CSC continued acquisition-driven growth to solidify its multinational presence. In June 2000, it acquired Policy Management Systems Corporation (rebranded as Mynd) for $568 million, adding billing and customer care software expertise with applicability to international telecom and insurance clients. The March 2003 purchase of DynCorp for approximately $914 million integrated advanced technical services, including aviation and logistics support, extending CSC's reach into global defense and civilian operations in regions such as the Middle East and Latin America. These moves positioned CSC as a leading provider of end-to-end IT solutions across continents, though they also increased integration complexities amid fluctuating federal contract demands by 2006.^[14]^[15]

Pre-Merger Restructuring and Challenges (2007–2016)

In the late 2000s, Computer Sciences Corporation encountered significant operational and financial pressures, intensified by the global financial crisis and underperformance on major fixed-price contracts, particularly the National Programme for IT (NPfIT) with the UK's National Health Service (NHS). CSC's involvement in delivering the Lorenzo patient records system under multi-year contracts awarded in 2003–2005 resulted in substantial cost overruns due to technical delays, scope complexities, and implementation challenges, leading to anticipated losses exceeding initial estimates.^[16] By 2011, these issues prompted the UK government to suspend CSC from bidding on new NHS contracts pending review of the £4.7 billion program.^[17] Accounting irregularities related to the NHS contracts further compounded challenges, as CSC delayed recognition of losses from 2009 to 2012 by manipulating financial models and reserving practices, violating U.S. GAAP requirements for immediate loss provisioning on unprofitable contracts.^[16] The U.S. Securities and Exchange Commission (SEC) investigated these practices, culminating in a $190 million settlement in June 2015 without admission of wrongdoing, alongside charges against a former executive for fraudulently altering loss projections.^[18] In October 2013, CSC renegotiated its NHS agreements into a consolidated revised project agreement to mitigate ongoing risks and stabilize deliveries.^[19] The appointment of Mike Lawrie as CEO in March 2012 marked a pivotal shift toward aggressive restructuring amid mounting losses, including a $2 billion write-down tied to the NHS contracts and broader portfolio impairments totaling over $4 billion in fiscal 2012.^[20] Lawrie's initiatives focused on cost reduction, operational efficiency, and portfolio simplification, targeting over $500 million in annual savings through workforce reductions, process streamlining, and executive team realignment in his first year.^[21] These efforts addressed declining revenues from contract completions, pricing pressures, and missed shifts toward cloud and agile services, though fiscal 2016 saw continued restructuring actions across segments to align with market demands.^[22]^[7] By 2015, persistent revenue declines—exemplified by a 12.6% drop in fourth-quarter sales to $2.91 billion—and structural mismatches between public and commercial operations prompted CSC to announce a corporate separation in May.^[23] This culminated in the November 30 spin-off of its U.S. public sector business, rebranded as CSRA Inc. after merging with SRA International, distributing shares to CSC shareholders alongside special cash dividends.^[24] The divestiture aimed to unlock value by allowing the government-focused entity to pursue specialized contracts while positioning CSC's commercial operations for potential partnerships, setting the stage for its 2017 merger with Hewlett Packard Enterprise's services unit.^[25]

Merger with HPE Enterprise Services (2017)

In May 2016, Hewlett Packard Enterprise (HPE) announced plans to spin off its Enterprise Services division and merge it with Computer Sciences Corporation (CSC) to form a new independent IT services company.^[26]^[27] The transaction valued HPE's Enterprise Services business at approximately $8.5 billion after-tax to HPE shareholders, who would receive an equity stake representing about 50% ownership in the combined entity, with CSC shareholders holding the remaining 50%.^[28]^[29] The merger aimed to achieve annual cost synergies of around $1 billion within the first year through operational efficiencies, scale in global delivery, and combined expertise in IT outsourcing and consulting.^[26] The deal received regulatory approvals, including from the U.S. Department of Justice and European Commission, following standard antitrust reviews.^[30] On February 15, 2017, the parties disclosed the name of the new company as DXC Technology, reflecting a focus on digital transformation, experience, and cloud services.^[31] The merger closed on April 1, 2017, as a tax-free transaction for shareholders; HPE distributed approximately 0.086 shares of DXC common stock for each HPE share held, ultimately delivering about $13.5 billion in total value to HPE and its investors through the spin-off and retained stake.^[32]^[33]^[30] Post-merger, DXC Technology operated as a Fortune 500 firm with annual revenues exceeding $26 billion, a workforce of around 170,000 employees across 70 countries, and a client base including over 90% of the Fortune 100.^[34] Leadership transitioned with Mike Lawrie, former CSC CEO, appointed as DXC's CEO, and Paul Wallisch from HPE Enterprise Services as CFO, emphasizing integration of CSC's application services with HPE's infrastructure capabilities.^[33] The combined entity positioned itself to compete more effectively in a consolidating IT services market, though it faced immediate pressures from legacy contract transitions and debt from the deal structure.^[35] HPE, freed from the services unit, refocused on hardware, networking, and hybrid IT solutions.^[30]

Business Operations

Core Services and Technological Focus

Computer Sciences Corporation (CSC) primarily offered information technology (IT) services and professional solutions, encompassing systems integration, application development and modernization, managed IT services, consulting, business process outsourcing, and cybersecurity.^[36]^[37]^[4] These services supported digital transformation for clients across industries such as banking, healthcare, manufacturing, insurance, and the public sector, with a emphasis on outsourcing contracts that often spanned multiple years and involved customized infrastructure management.^[37]^[9] CSC organized its commercial operations into two main segments: Global Business Services (GBS), which focused on application services, consulting, big data analytics, and industry-specific software solutions, accounting for approximately 55% of revenues in fiscal year 2017; and Global Infrastructure Services (GIS), centered on managed desktop solutions, data center operations, cybersecurity, and cloud-based infrastructure, comprising about 45% of revenues in the same period.^[36]^[37] GBS offerings included enterprise applications integration with partners like SAP and HCL Technologies, while GIS provided hybrid cloud environments leveraging technologies from providers such as Amazon Web Services, IBM, Microsoft, and VMware.^[37] The company's technological focus evolved toward next-generation IT capabilities, including cloud computing (such as Infrastructure as a Service and private cloud deployments), mobility, virtualization, big data analytics, and advanced cybersecurity measures to address IT modernization and risk management.^[36]^[37]^[4] Proprietary tools like the CSC Agility Platform supported service management, and acquisitions such as Xchanging in May 2016 for $492 million enhanced capabilities in business process services and analytics.^[36] This emphasis on scalable, technology-enabled solutions positioned CSC to handle complex, mission-critical systems for both commercial and government clients prior to its 2017 merger.^[36]^[4]

Major Contracts and Client Base

Computer Sciences Corporation's client base encompassed approximately 2,500 organizations across more than 70 countries, spanning U.S. federal, state, and local governments, as well as international public sector entities and commercial enterprises in sectors such as aerospace, healthcare, transportation, and financial services.^[38] The North American Public Sector (NPS) segment, focused on government clients, generated 36% of the company's total revenue in fiscal year 2013, underscoring the heavy reliance on public contracts for financial stability.^[38] Major contracts with U.S. federal agencies formed the cornerstone of CSC's government portfolio, including military branches, civil departments, the Department of Homeland Security, and NASA. In December 1998, CSC led a consortium awarded the IRS's PRIME contract, a multi-year partnership valued in the billions over 15 years to modernize tax agency computer systems through systems design, software development, and subcontractor management.^[39] ^[40] In December 1999, CSC secured a $680 million outsourcing agreement with the U.S. Army for IT services.^[41] In July 2007, the company won a NASA contract estimated at $597 million over a two-year base period plus eight one-year options for supercomputing support services.^[42] Other notable U.S. government awards included a 1981 contract exceeding $200 million to build a secure data network for the U.S. Customs Service and various NASA task orders, such as a $103 million deal in January 2013 for computational support at Goddard Space Flight Center.^[4] ^[43] Internationally, CSC held significant public sector contracts, such as those with the U.K. National Health Service (amended in August 2012 to adjust commitments), the Atomic Energy Authority, Network Rail, the Post Office, and UK Visas.^[38] ^[10] Commercial clients included Avis Budget Group and various airlines, logistics firms, and healthcare providers, though these contributed less to overall revenue compared to government work.^[37] ^[4] In March 2007, CSC announced $768 million in contracts from 10 unspecified clients, reflecting diversified deal flow across public and private sectors.^[44]

Organizational Structure and Workforce

Computer Sciences Corporation structured its operations around two primary reportable segments: Global Business Services (GBS) and Global Infrastructure Services (GIS).^[22] GBS delivered application-centric services, including consulting, software development, IT modernization, cloud migration, mobility solutions, and big data analytics, while also encompassing business process outsourcing for industries such as banking, healthcare, manufacturing, and the public sector; this segment generated 51% of fiscal 2016 revenue.^[22] GIS focused on infrastructure management, providing data center hosting, cybersecurity, managed desktop services, end-user computing, and infrastructure-as-a-service (IaaS) cloud offerings, accounting for 49% of the same year's revenue.^[22] The segment-oriented framework supported global delivery through a network of delivery centers, leveraging partnerships with vendors like AT&T and HCL Technologies for specialized capabilities, and aligned functional units for sales, client management, and innovation under centralized executive oversight from headquarters in Tysons, Virginia.^[22] Operations extended across North America (primary revenue base), Europe, Asia, and Australia, with a mix of onshore, nearshore, and offshore models to optimize cost and expertise.^[22] CSC's workforce totaled approximately 59,000 employees as of April 1, 2016, comprising IT specialists, systems engineers, consultants, and operational support personnel skilled in service delivery and technology implementation.^[22] These employees operated in over 60 countries, reflecting the company's emphasis on geographic diversification for 24/7 client support and scalability.^[22] The headcount rose by roughly 7,000 following the May 2016 acquisition of Xchanging plc, which bolstered business process services capabilities ahead of the 2017 merger with Hewlett Packard Enterprise's Enterprise Services division.^[22] By March 31, 2017, the workforce stood at about 60,000 amid ongoing restructuring to streamline operations.^[45]

Innovations and Achievements

Pioneering Contributions to IT Services

Computer Sciences Corporation (CSC), founded in April 1959 in Los Angeles by Roy Nutt and Fletcher Jones with initial capital of $100, emerged as one of the earliest independent providers of software services, developing tools such as assemblers and compilers at a time when software was predominantly bundled with hardware by manufacturers like IBM.^[9]^[3] By focusing on proprietary software for systems from Honeywell and Univac, CSC decoupled software development from hardware sales, enabling clients to acquire specialized programming without tied purchases.^[9] This approach positioned CSC as a leader in the nascent software market, achieving status as the largest U.S. software company by 1963 and becoming the first such firm listed on the American Stock Exchange in 1968, with annual sales reaching $53.5 million that year.^[9]^[2] In the 1960s, CSC pioneered practical applications of data processing, introducing Computax for automated tax calculations and Computicket for computerized ticketing systems, which demonstrated scalable commercial uses of computing beyond government or research.^[9] The company secured significant early contracts, including a $5.5 million agreement with NASA in 1966 for systems development, and expanded into processing medical claims and air cargo management, such as at Heathrow Airport, laying groundwork for IT outsourcing by handling client data operations externally.^[9] By 1972, revenue had grown to $127.5 million, predominantly from government contracts that underscored CSC's reliability in mission-critical computing.^[9] A key innovation was the 1969 launch of Infonet, a commercial network of mainframe computing centers that enabled time-sharing services, allowing multiple remote users—primarily U.S. government and military clients—to access and run jobs simultaneously on shared resources via Univac 1180 systems.^[10]^[46] This network represented an early form of distributed IT services, predating widespread personal computing and facilitating efficient resource utilization in an era of expensive mainframes, which CSC extended into systems integration for broader outsourcing models.^[9]^[47] Through these efforts, CSC influenced the shift toward service-based IT delivery, emphasizing externalized expertise over in-house hardware dependency.^[9]

Industry Recognition and Awards

In 2010, Computer Sciences Corporation (CSC) received two Large Business Prime Contractor of the Year awards from NASA for its information technology services contracts at the Jet Propulsion Laboratory and Goddard Space Flight Center, recognizing exemplary performance in supporting mission-critical operations.^[48] CSC was ranked 8th among the world's largest software and services providers in Software Magazine's 2012 Software 500 list, which evaluates companies based on software and services revenue.^[49] Earlier, in 2007, the company placed 6th in the same ranking, reflecting its scale in enterprise IT solutions during a period of significant revenue growth from outsourcing and systems integration.^[50] The company also earned ISO 9001 certification, demonstrating compliance with international standards for quality management in IT services delivery, though this is a widely held credential among large providers rather than a unique honor.^[51] CSC's contributions to large-scale technology transformations were noted in industry profiles for leadership in mission-critical IT support, particularly for government and enterprise clients, though such assessments often stem from self-reported data and contract performance metrics.^[4]

Controversies and Legal Issues

Government Contract Failures and Cost Overruns

Computer Sciences Corporation (CSC) encountered significant challenges in several high-profile government contracts, particularly with the United Kingdom's National Health Service (NHS) and U.S. federal agencies, resulting in substantial cost overruns, delays, and financial write-downs. The most prominent failure involved CSC's role in the NHS National Programme for IT (NPfIT), where it was awarded contracts worth £3.1 billion in 2003 to deliver care records systems to 220 trusts in the North West and West Midlands regions.^[52] By June 2009, CSC forecasted over $1 billion in revenue shortfalls on the project due to persistent development issues.^[5] Deployment milestones were repeatedly missed, triggering potential daily penalties of up to $160,000, and after eight years of setbacks, CSC admitted in December 2011 that the contract held little or no value for shareholders.^[5]^[53] These NHS issues culminated in a $1.5 billion write-down of contract assets in the third quarter of fiscal year 2012 (ending February 2012), stemming from CSC's inability to deliver functional software and subsequent contract amendments that waived penalties in exchange for reduced scope.^[5] The U.S. Securities and Exchange Commission later charged CSC with GAAP violations for using improper accounting models from fiscal year 2010 to 2012, which concealed the contract's deteriorating profitability by treating proposed amendments as enforceable changes rather than impairments.^[5] Overall, the NPfIT program, including CSC's contributions, contributed to taxpayer costs exceeding £10 billion by 2013, with the project dismantled amid widespread criticism for delays and undelivered systems.^[54] In the United States, CSC's modernization contracts with the Internal Revenue Service (IRS) also suffered from delays and overruns. For the Customer Account Data Engine (CADE), originally due in 2005, delivery was 30 months late with costs $37 million over budget; the Integrated Financial System (IFS) was one year behind schedule and exceeded budget by more than $53 million.^[55] In February 2004, the IRS issued a formal notice to CSC citing these technical failures as a joint lapse, prompting plans to compete future work and eroding confidence among lawmakers and oversight bodies.^[55] CSC's 1999 contract for the U.S. Army's Logistics Modernization Program (LMP) faced similar hurdles, with unanticipated customizations for complex logistics requirements causing indefinite delays and cost escalations.^[56] The disputes led CSC to file 14 appeals totaling over $2 billion in claims against the Army, which countered with its own claims; resolution via alternative dispute mechanisms in the mid-2010s yielded CSC a $277 million one-time payment alongside a five-year extension valued at approximately $1 billion.^[56] These incidents, documented in government audits and regulatory filings, underscored systemic risks in CSC's government engagements, including underestimation of technical complexities and inadequate risk provisioning.^[57]

Accounting Fraud and SEC Enforcement

In 2009, Computer Sciences Corporation (CSC) began engaging in accounting practices that materially overstated its consolidated pretax income, primarily to conceal escalating losses on its largest contract with the UK's National Health Service (NHS) for developing and maintaining patient administration systems.^[58] The company had underbid the fixed-price contract in 2003, leading to significant cost overruns as technical challenges mounted, but rather than fully disclosing these issues, CSC executives directed improper revenue recognition and reserve manipulations.^[5] For instance, in the first quarter of fiscal year 2009, these actions alone inflated pretax income by over 5%, enabling CSC to meet analysts' earnings expectations despite underlying losses.^[5] The fraud extended to mishandling client disputes and settlements, such as overstating gains from a Danish client resolution by prematurely recognizing revenue without adequate documentation, further distorting financial statements from 2009 through 2011.^[5] CSC's senior executives, including CEO Michael Laphen and CFO Michael Mancuso, were aware of these practices but failed to enforce proper accounting standards under Generally Accepted Accounting Principles (GAAP), prioritizing short-term earnings appearances over accurate disclosure.^[58] This concealment masked risks from the NHS contract, which ultimately contributed to a $1.5 billion writedown in 2012 after CSC exited the project.^[58] On June 5, 2015, the U.S. Securities and Exchange Commission (SEC) filed charges against CSC and several former executives for violations of federal securities laws, including antifraud provisions under Section 10(b) of the Securities Exchange Act of 1934 and related rules.^[58] CSC neither admitted nor denied the allegations but agreed to a $190 million civil penalty, one of the largest for accounting fraud at the time, and committed to retaining an independent compliance consultant to review its financial reporting controls.^[58] The SEC also invoked Sarbanes-Oxley Act clawback provisions to seek recovery of incentive-based compensation from executives, recovering approximately $3.1 million from Laphen and Mancuso in subsequent settlements.^[59] Five of the charged executives settled with the SEC, consenting to cease-and-desist orders, officer-and-director bars, and monetary penalties totaling millions, while others, including Laphen, contested the claims in administrative proceedings.^[6] The enforcement action highlighted systemic failures in CSC's internal controls, prompting restatements of financials for fiscal years 2009–2011 and underscoring the SEC's emphasis on accountability for disclosure fraud tied to contract performance risks.^[5] In May 2025, the SEC established a Fair Fund to distribute over $200 million in penalties to harmed investors, finalizing remediation from the resolved case.^[60]

Other Regulatory Settlements and Disputes

In October 2018, Computer Sciences Corporation (CSC) agreed to pay $389,355 to the United States to resolve civil claims under the False Claims Act arising from allegations that the company knowingly submitted false or fraudulent claims for payment to the government. The settlement, reached with the U.S. Attorney's Office for the Western District of Washington, did not include any admission of liability by CSC.^[61] In 2008, CSC paid $1.37 million to settle Department of Justice allegations that it provided kickbacks to consultants in exchange for assistance in securing state contracts in Louisiana, part of a broader probe into improper influence peddling. The company neither admitted nor denied the claims in the civil resolution.^[62] In December 2020, CSC entered a consent decree with the Equal Employment Opportunity Commission (EEOC) to resolve a lawsuit alleging violations of the Age Discrimination in Employment Act through targeted layoffs of employees aged 40 and older, directed by the company's then-CEO. The agreement required CSC to pay $700,000 in back pay and damages to affected former employees, issue an anti-discrimination statement from the parent company's CEO, and revise layoff selection criteria and training to ensure compliance with federal anti-discrimination laws, without any admission of wrongdoing; the case was filed in the U.S. District Court for the Southern District of New York.^[63] CSC also faced disputes under the Fair Labor Standards Act, including a 2005 class action settlement for $24 million covering over 14,000 current and former technical employees misclassified as exempt from overtime pay requirements. The company announced the resolution without conceding liability, following court approval in a U.S. District Court.^[64]^[65]

Legacy and Industry Impact

Influence on Modern IT Outsourcing

Computer Sciences Corporation (CSC) significantly shaped modern IT outsourcing by pioneering the model of comprehensive, large-scale contracts that transferred entire enterprise IT operations—including personnel, infrastructure, and processes—to specialized providers. This approach, which gained traction in the early 1990s amid corporate efforts to reduce costs and leverage external expertise, contrasted with earlier ad-hoc software services and established outsourcing as a strategic business practice. CSC's emphasis on long-term agreements with measurable performance metrics laid groundwork for standardized contracts in the industry.^[9] A defining milestone was CSC's 1991 agreement with General Dynamics, a 10-year contract valued at up to $3 billion, under which CSC assumed responsibility for the defense contractor's data processing and absorbed approximately 2,600 employees along with $200 million in IT assets.^[66]^[67] Described at the time as one of the largest data processing outsourcing deals ever awarded, it demonstrated the viability of outsourcing as a means to streamline operations without internal disruption, influencing subsequent corporate decisions to externalize IT functions.^[9]^[4] CSC built on this with additional mega-contracts, including a $1 billion, 10-year deal with British Aerospace in 1994 and a $4 billion, 10-year pact with DuPont in 1997 that encompassed IT management for 26,000 personnel across 40 countries.^[10] These engagements showcased CSC's capacity for global scale, incorporating offshore delivery centers—such as those in India—and rigorous service level agreements (SLAs) to ensure accountability, practices that became integral to modern outsourcing frameworks.^[4] By 1996, CSC had secured three of the five largest IT sourcing contracts worldwide, fueling rapid sector growth and validating outsourcing's potential for efficiency gains.^[68] The company's innovations extended to early networked services like Infonet, launched in 1969 as a precursor to cloud-like computing access, which informed later managed services models.^[10] CSC's track record in delivering cost reductions—such as slashing Anglian Water's IT expenses to 20% of prior levels by 2005 through optimized operations—provided empirical evidence that bolstered industry adoption.^[10] Today, CSC's legacy endures in the prevalence of hybrid outsourcing arrangements, where providers handle complex, multi-vendor environments akin to CSC's integrated solutions, even as digital transformation shifts focus toward agile and cloud-native services.^[9]

Post-Merger Evolution via DXC Technology

DXC Technology was formed on April 1, 2017, through the merger of Computer Sciences Corporation (CSC) and Hewlett Packard Enterprise's (HPE) Enterprise Services division, creating an independent IT services provider with approximately 170,000 employees and combined annual revenues of around $26 billion.^[33]^[34] The transaction involved HPE spinning off its services unit and merging it into CSC, with DXC assuming $600 million in net pension liabilities and $400 million in other obligations, while HPE received a $3 billion cash payment.^[69] This structure positioned DXC as a "pure-play" end-to-end IT services company focused on legacy system modernization, cloud migration, and outsourcing, but integration challenges emerged due to overlapping operations and differing corporate cultures from the legacy entities.^[70] In the years immediately following the merger, DXC pursued growth through acquisitions to expand capabilities in analytics, cybersecurity, and digital transformation, completing 17 deals by August 2025, with peaks in 2018 (five acquisitions) and 2019 (four).^[71] These moves aimed to shift from traditional IT outsourcing toward hybrid cloud and AI-driven services, though the company faced headwinds from maturing legacy contracts, intensified competition from cloud-native firms like AWS and Microsoft, and macroeconomic pressures.^[72] Financially, DXC encountered disputes, including a 2019 settlement where HPE agreed to pay $666 million to resolve accounting issues tied to the merger's pension and liability assumptions.^[69] By fiscal year 2023, the firm reported revenue stability alongside $700 million in two-year free cash flow generation, but ongoing cost optimization efforts highlighted persistent profitability strains.^[73] Performance metrics reflected these tensions into the mid-2020s, with third-quarter fiscal 2025 revenues at $3.23 billion, down 5.1% year-over-year, amid adjusted EBIT margins of 8.9% and efforts to streamline operations.^[74] Declining revenues, elevated debt from the merger era, and limited organic growth contributed to market volatility, including a $1.7 billion market cap loss in August 2023 following an earnings miss and guidance cut.^[75]^[76] Despite these issues, DXC evolved strategically toward business transformation services, emphasizing AI integration and partnerships, as evidenced by its July 2025 acquisition of Factoria de Transformación de Operaciones y Servicios to bolster operational capabilities.^[77]^[78] By mid-2024, speculation positioned DXC as an acquisition target for larger tech firms seeking its enterprise client base and modernization expertise, driving a temporary 11.5% share price surge.^[76] This trajectory underscores DXC's adaptation from a merger-forged conglomerate to a more focused, albeit challenged, player in a cloud-dominated IT landscape.

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Computer Sciences to Buy Mynd for $568 Million - Insurance Journal
Jun 20, 2000 · Computer Sciences Corp. has agreed to buy Mynd, formerly Policy Management Systems Corp., for $568 million in an all-cash deal.Missing: 1990-2006 | Show results with:1990-2006
[15]
Exhibit 99.1 Press Release - SEC.gov
EL SEGUNDO, Calif., and RESTON, Va., December 13, 2002 -- Computer Sciences Corporation (NYSE: CSC) and DynCorp today announced they have entered into a merger ...
[16]
[PDF] Wilfred Robert Sutcliffe - SEC.gov
Jun 5, 2015 · Defendant Wilfred Robert Sutcliffe perpetrated this fraud by manipulating one of CSC's accounting models after he learned that the company was ...
[17]
CSC locked out of new NHS contracts - The Register
May 12, 2011 · Prime Minister David Cameron said yesterday CSC had been suspended from new NHS contracts while the future of the £4.7bn patient record programme is assessed.Missing: losses | Show results with:losses<|separator|>
[18]
CSC Neither Admits Nor Denies SEC Charges to Pay $190 Million
Jun 5, 2015 · The SEC alleges that CSC's accounting and disclosure fraud began after the company learned it would lose money on the NHS contract because it ...Missing: losses 2007-2016
[19]
CSC 3.28.2014 10-K - SEC.gov
Mar 28, 2014 · On October 4, 2013, we entered into a binding revised project agreement (RPA) with the NHS, which consolidates the three regional contracts ...
[20]
A turnaround specialist reshapes Computer Sciences Corp.
Jul 30, 2015 · The company was facing $2 billion in losses and write-downs from a troubled contract to computerize patient records for Britain's National ...Missing: key achievements
[21]
CSC promises to cut more than $500 million in first year of ...
which recorded a ...
[22]
computer sciences corporation - SEC.gov
During fiscal 2016, the Company initiated restructuring actions (the Fiscal 2016 Plan) across its business segments. The objectives of the Fiscal 2016 Plan ...
[23]
Computer Sciences to split into two companies - Yahoo Finance
May 19, 2015 · ... company said. Fourth-quarter revenue fell 12.6 percent to $2.91 billion, hurt by lowered prices, restructuring and contract completions.
[24]
Exhibit - SEC.gov
On May 19, 2015, CSC announced plans to separate its U.S. public sector business from CSC. Prior to CSC's distribution of the shares of CSRA common stock to CSC ...
[25]
CSC to split in two, spin off U.S. public sector business
May 19, 2015 · CSC said it's making the split because government clients are looking to work with companies that have specific experience in government work.
[26]
HPE services division to spin off and merge with CSC - DCD
May 25, 2016 · and Hewlett Packard Enterprise in November 2015, while CSC spun off its US public sector serving business into CSRA that same month. The ...
[27]
HPE CEO Meg Whitman: Computer Sciences deal 'unlocks value'
May 25, 2016 · The merger, which values HPE's services business at about $8.5 billion, is expected to be completed by the end of March 2017. HPE shareholders ...
[28]
[PDF] Investor Presentation May 24, 2016 - HPE Investor Relations
May 24, 2016 · Enterprise Services Transaction Value. $8.5B. Target ... Value of stock based on 60-day average closing CSC share price as of May 23, 2016.
[29]
Hewlett Packard Enterprise - SEC.gov
May 24, 2016 · The transaction is expected to deliver approximately $8.5 billion to HPE's shareholders on an after-tax basis. This includes an equity stake in ...
[30]
Hewlett Packard Enterprise Completes Spin-off and Merger of
Hewlett Packard Enterprise completes spin-off and merger of its Enterprise Services Business with CSC.
[31]
DXC Technology Revealed as Name for Combined CSC and HPE ...
Feb 15, 2017 · DXC Technology will be the name of the new company formed by the proposed merger of CSC (NYSE: CSC) and the Enterprise Services business of Hewlett Packard ...
[32]
[PDF] off and Merger of its Enterprise Services Business with CSC
Apr 3, 2017 · the outstanding shares of DXC common stock has been issued to pre-merger. CSC stockholders. The total value of the equity for HPE ...Missing: issues | Show results with:issues
[33]
Hewlett Packard Enterprise Completes Spin-Merger To Form DXC ...
Apr 4, 2017 · On 04/01/17, Hewlett Packard Enterprise completed the spin-merger of its Enterprise Service segment with CSC to form DXC Technology.
[34]
DXC Technology to emerge from CSC and HPE Enterprise Services ...
Feb 15, 2017 · DXC Technology will be the name of the new $26 billion IT services company formed by the proposed merger of CSC and HPE's Enterprise Services business.Missing: issues | Show results with:issues
[35]
[PDF] united states securities and exchange commission
Dec 15, 2017 · On April 1, 2017, we completed the separation and merger of our Enterprise Services business with Computer Sciences Corporation (“CSC ...
[36]
[PDF] COMPUTER SCIENCES CORPORATION - Investor Relations
May 25, 2017 · As previously disclosed, effective April 1, 2017, Computer Sciences Corporation (“CSC” or the “Company”) became a wholly owned subsidiary of DXC.
[37]
Must-Know Overview of Computer Sciences Corporation
Mar 24, 2015 · Computer Sciences Corporation provides information technology and professional services and solutions. As of March 20, 2015, it had a market ...Missing: core focus
[38]
CSC 3.29.2013 10-K - SEC.gov
Mar 29, 2013 · Contracts with the U.S. federal government and related agencies account for a significant portion of our revenue and earnings. Our NPS segment ...<|separator|>
[39]
[PDF] ir-98-75 irs moves forward with computer modernization, selects ...
Dec 9, 1998 · The IRS selected a consortium headed by Computer Sciences Corporation to work in a multi-year partnership with the agency on its Prime ...
[40]
COMPANY NEWS; COMPUTER SCIENCES-LED CONSORTIUM ...
Computer Sciences Corp says Internal Revenue Service has awarded 15-year contract to manage tax agency's computer systems to consortium it is leading; ...
[41]
CSC wins outsourcing contract for U.S. Army - CNET
Dec 30, 1999 · Computer Sciences Corp. today said it has been awarded an outsourcing contract for the U.S. Army worth $680 million, further extending its ...
[42]
CSC Wins $597 Million NASA Contract to Provide Supercomputing ...
Jul 23, 2007 · CSC estimates the value of the contract, which has a two-year base period and eight one-year options, to be $597 million if all options are ...
[43]
NASA awards CSC $103 million contract - FedScoop
Jan 14, 2013 · Computer Science Corporation has won a $103 million contract to provide support to NASA Goddard Space Flight Center's Computational and ...
[44]
https://www.marketwatch.com/story/computer-sciences-signs-768-mln-pacts-from-10-clients
[45]
computer sciences corporation - SEC.gov
As previously disclosed, effective April 1, 2017, Computer Sciences Corporation (“CSC” or the “Company”) became a wholly owned subsidiary of DXC Technology ...
[46]
CSC: History - Financial Times
Apr 4, 2006 · The 1970s saw further expansion and the development of Infonet, a network which allowed people from different sites to run jobs simultaneously ...
[47]
Exploring the Internet: Round Three, San Francisco - Public Resource
Infonet was originally started as a time-sharing company owned by Computer Sciences Corporation (CSC), offering application programs on a series of Univac 1180s ...Missing: pioneering | Show results with:pioneering
[48]
CSC Wins "Contractor of the Year" Awards From NASA - SpaceNews
Jan 4, 2010 · CSC received two “Large Business Prime Contractor of the Year” awards for information technology services contracts at both the NASA Jet ...
[49]
Software Magazine 500 Companies
Jul 14, 2019 · HPE recently completed the separation and merger of its Enterprise Services business with Computer Sciences Corporation. ... Software 500.
[50]
The 2007 Software 500 (Top50) - 克莱沃曼
Jan 22, 2008 · The 2007 Software 500 (Top50). 1 IBM. 2 Microsoft Corporation. 3 EDS. 4 Hewlett-Packard Company. 5 Accenture. 6 Computer Sciences Corporation. 7 ...
[51]
What certifications or achievements does Computer Sciences Corp ...
Sep 16, 2025 · Computer Sciences Corp. has earned several certifications like ISO 9001, showcasing its dedication to quality and compliance.
[52]
Dismantled National Programme for IT in NHS: report published
Sep 18, 2013 · The Department's original contracts with CSC totalled £3.1 billion for the delivery of care records systems to 220 trusts in the North, Midlands ...Missing: Sciences Corporation overruns
[53]
Computer Sciences Corporation could retain £1bn in health contracts
Mar 5, 2012 · CSC admitted in December that eight years of delays and setbacks on its disastrous NHS contract had left little or no value for shareholders ...Missing: issues | Show results with:issues
[54]
Abandoned NHS IT system has cost £10bn so far - The Guardian
Sep 17, 2013 · "The department [of health]'s latest estimate of £9.8bn leaves out the future costs of Lorenzo or the potential large future costs arising from ...
[55]
Delays push IRS to punish contractor - Government Executive
Feb 12, 2004 · Everson also said that the budget overruns and missed deadlines were a "joint failure" of CSC and the IRS. "It did get away from us," he ...
[56]
Logistics Modernization Program - HKA
The unanticipated customizations led to significant delays and cost overruns on the contract, which resulted in CSC filing 14 claim appeals before the Armed ...Missing: problems | Show results with:problems
[57]
[PDF] Review of Unbilled Subcontractor Costs Submitted by Computer ...
Apr 9, 2001 · The initial projected cost of the full five-year contract was $46.5 million. Current obligations total $63.2 million; NRC has expended $48.4 ...Missing: overruns | Show results with:overruns
[58]
SEC Charges CSC and Former Executives With Accounting Fraud
Jun 5, 2015 · The Securities and Exchange Commission today charged Computer Sciences Corporation and former executives with manipulating financial results and concealing ...Missing: overruns | Show results with:overruns
[59]
Computer Sciences Corporation, Michael Laphen, Michael Mancuso ...
The Order stated that from 2009 to 2011, CSC engaged in a wide-ranging accounting and disclosure fraud that materially overstated its earnings.Missing: cost | Show results with:cost
[60]
[PDF] Computer Sciences Corporation, Michael Laphen ... - SEC.gov
May 28, 2025 · accounting and disclosure fraud that materially overstated its earnings and concealed from investors significant problems with its largest ...
[61]
Computer Sciences Corporation Agrees to Pay $389355 to Resolve ...
Oct 30, 2018 · Computer Sciences Corporation Agrees to Pay $389,355 to Resolve ... Privacy · For Employees · Office of the Inspector General · No FEAR Act ...
[62]
Hewlett-Packard pays $55m to settle 'kickbacks' case - The Guardian
Aug 31, 2010 · In 2007, IBM agreed to pay $2.9m and PricewaterhouseCoopers handed over $2.3m, while Computer Sciences Corporation paid $1.37m in 2008. Such ...
[63]
Computer Science Corporation to Pay $700,000 to Settle EEOC Age ...
Dec 11, 2020 · Under the two-year consent decree settling the suit, the company will pay $700,000 in lost wages and damages to the former employees who ...
[64]
[PDF] csc announces settlement of overtime pay class action lawsuit
Apr 21, 2005 · CSC: CSC ANNOUNCES SETTLEMENT OF OVERTIME PAY CLASS ACTION LAWSUIT April 21, 2005. 3/12/2007 http://www.csc.com/investorrelations/news/3822.Missing: FLSA | Show results with:FLSA
[65]
Computer Sciences Corporation Overtime Wages - Lieff Cabraser
The Court in July 2005 granted final approval to a $24 million settlement with Computer Sciences Corporation.Missing: FLSA | Show results with:FLSA
[66]
CSC AWARDED GENERAL DYNAMICS CONTRACT
Sep 23, 1991 · CSC AWARDED GENERAL DYNAMICS CONTRACT. COMPUTER DEAL COULD BE WORTH UP TO $3 BILLION OVER 10 YEARS. September 23, 1991More than 34 years ago ... " ...
[67]
Computer Sciences, General Dynamics sign pact - UPI Archives
'This is one of the largest data processing outsourcing contract ever awarded,' said CSC Chairman William Hoover. 'It will contribute about $350 million to ...
[68]
The impact of corporate outsourcing on company value
Consider the recent history of Computer Science Corporation. In 1996, CSC won three of the five largest sourcing deals concluded that year. Its market ...2. Value Creation For The... · 4. Value Creation For The... · 5. Can Outsourcing Also...Missing: modern | Show results with:modern
[69]
HPE Set To Pay DXC $666 Million In Spin-In Merger 'Accounting ...
Aug 19, 2019 · Hewlett Packard Enterprise is set to pay DXC Technology $666 million as a result of an “accounting” dispute. DXC, which was formed from HPE ...
[70]
Impact Of Merger & Acquisition on Employee Culture : A Case Study ...
This research is focussing on the case of a recent merger in the IT industry. The spin off merger of HPE with CSC had resulted in a new company, DXC Technology.
[71]
List of 17 Acquisitions by DXC (Aug 2025) - Tracxn
Aug 13, 2025 · DXC has made a total of 17 acquisitions. The peak years for acquisitions were 2018 with 5, 2019 with 4, and 2017 with 2.Missing: post- evolution
[72]
DXC Technology Partner Case Study (2017-2025): The Operator ...
Sep 4, 2025 · It's a case study in strategic evolution that reveals why the future of enterprise IT belongs not to pure-play specialists, but to hybrid ...
[73]
[PDF] Delivering eXcellence for our Customers and Colleagues
May 18, 2023 · The Company has defined its reporting units as its reportable segments ... Enterprise Company, Computer Sciences Corporation, Everett SpinCo, Inc.
[74]
DXC Technology Reports Third Quarter Fiscal Year 2025 Results
Feb 4, 2025 · Total revenue of $3.23 billion, down 5.1% (down 4.2% on an organic basis)(1) EBIT margin of 4.5%, and adjusted EBIT(2) margin of 8.9% ...<|control11|><|separator|>
[75]
DXC Loses $1.7B In Market Cap In Wake Of Earnings Miss ... - CRN
Aug 3, 2023 · Investors pummeled DXC Technology stock, wiping out nearly one-third of the company's value or about $1.68 billion in market capitalization.
[76]
Why Is DXC Technology (DXC) on the Acquisition Radar Again?
Jun 11, 2024 · DXC Technology Company's DXC shares soared 11.5% on Monday as the IT services and solutions provider garnered attention as a potential acquisition target.
[77]
DXC Technology 2025 Company Profile - PitchBook
DXC Technology's most recent deal was a Merger/Acquisition with Factoria De Transformacion De Operaciones Y Servicios. The deal was made on 07-Jul-2025. Company ...
[78]
[PDF] From IT Modernization to Business Transformation - DXC Technology
It depicts four examples of how new technologies have evolved through four distinct phases – from their initial genesis through custom builds to product and ...<|separator|>