DXC arises from the ashes of HPE and CSC

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DXC arises from the ashes of HPE and CSC
Mike Lawrie rings the bell at the NYSE.

Meet the world's third-largest solution provider.

The product of the mash-up of CSC and HPE Enterprise Services, DXC Technology, officially opened for business today.

Once the company's chairman and president Mike Lawrie rang the bell at the New York Stock Exchange, the world's third largest solution provider came into existence.

With 170,000 global employees, US$25 billion in annual sales, and 6000 enterprise and public sector clients across 70 countries, DXC today commenced its first official day of trading at US$69.20 per share.

Launch events followed each other like dominos across the globe, underpinned by an aggressive advertising campaign intended to introduce the world to the new brand.

DXC is "ideally suited to meeting the needs of a rapidly changing technology marketplace", according to Lawrie. 

The company is positioning itself as a leader in emerging technologies to reinvigorate the "sort of tired" CSC and HPE ES brands. It says it wants to "lead the digital disruption cycle".

The IT services industry is "fundamentally changing", Lawrie said, moving away from the all-encompassing, multi-year projects that traditionally accounted for much of CSC and HPE Enterprise Services' business.

"Our goal is to produce greater value for clients, partners and shareholders, along with compelling career opportunities for our people," Lawrie said.

It said its traditional IT business, which makes up three quarters of the overall group, will likely shrink by as much as 7 percent annually as the company shifts towards digital technologies.

Only half of its employees will work in traditional IT roles by mid 2020, DXC forecast.

Its digital business - currently the smallest in the DXC portfolio - is expected to grow by as much as 30 percent annually, thanks partially to a US$500 million investment made by CSC in the past two years, and planned tuck-in acquisitions that will expand its digital product suite, DXC told investors [pdf].

Overall, DXC is aiming for US$24 billion in group revenue in its first year of operation, and revenue growth of 4 percent by 2020.

It is targeting US$1 billion in cost savings in the first year of operations, predominantly from workforce optimisation and US$300 million worth of supply chain efficiencies.

The company will also slash its 15,000-strong supplier list in half by 2020, cut costs from contract labour, and reduce its data centre and facilities footprint.

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