Table 2 HP Services - Financial Results/Forecast May-04
        (Fiscal year end: Oct 31)      
      2005e % of Change 2004e % of 2003 % of
      ($ Mill) Rev 05/04 ($ Mill) Rev ($ Mill) Rev
_ _ _ _ _ _ _ _ _ _
Revenue                  
Business Segments (est)                
  Outsourcing   $3,580 24.0% 31.6% $2,720 20.3% $2,120 17.2%
  Consulting & Integration $2,830 19.0% 8.4% $2,610 19.5% $2,480 20.2%
  Maintenance (Cust Support) $8,490 57.0% 5.2% $8,070 60.2% $7,705 62.6%
                   
Total Revenue (w. Maint.) $14,900 100.0% 11.2% $13,400 100.0% $12,305 100.0%
(w/o Maint.)   $6,410   20.3% $5,330   $4,600  
6-month 2004 (actual)       $6,653 10.6% $6,015  
Costs                  
Cost of Revenue   $11,620 78.0% 12.6% $10,320 77.0% $9,230 75.0%
One-time Charges                
Total Costs     $11,620 78.0% 12.6% $10,320 77.0% $9,230 75.0%
                   
Gross Profit/Margin   $3,280 22.0% 6.5% $3,080 23.0% $3,075 25.0%
Expenses                  
Sales, General & Marketing $1,940 13.0% 7.2% $1,810 13.5% $1,700 13.8%
Restructuring Charges (apportioned to HPS)         $132  
Total Expenses   $1,940 13.0% 7.2% $1,810 13.5% $1,832 14.9%
                   
Operating Profit (Loss) $1,340 9.0% 5.5% $1,270 9.5% $1,243 10.1%
as reported w/o charges       $1,372 10.2% $1,372 11.1%
6-month 2004 (actual)       $587 -7.7% $636 10.6%
Other Income (Loss)   $10 0.1% 0.0% $10 0.1% ($1) -0.0%
                   
Income (Loss) Before Tax $1,350 9.1% 5.5% $1,280 9.6% $1,242 10.1%
                   
Income Tax (Benefit)   $247 18.3% -12.4% $282 22.0% $150 12.1%
                   
Net Income (Loss)   $1,103 7.4% 10.5% $998 7.4% $1,092 8.9%
                   
  Source: Annex Research   NOTE: Actual results including Compaq services after May 1, 2002    
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