The shares of Computacenter plunged by nearly 20 percent in early morning trading after it informed its investors that the revenue of the company has dropped by three percent in the face of some “significantly more challenging” conditions.
The FTSE 250 IT company warned investors that the third-quarter revenues have dropped to £900 million from the £931 million that was reported in the same period during the previous year, while its revenues in the United Kingdom plunged by nine percent to £296 million for the three months to the end of September.
The trading update held some little good news for the investors after Computacenter reported strong first-half results that amounted to an 18 percent boost to its revenue, but still sending its shares down by 18 percent from 1,210p to 1,029p.
The Germany business of Computacenter grew by only one percent, while even its revenue growth for its international services which amounted to 28 percent was not able to stop the rot as the revenues of the firm slumped.
In a statement, the company disclosed: “Our expectation for the fourth quarter is for improved growth before acquisitions but not to the levels seen in the first half of the year,”
The leadership of the firm forecasted interest in its professional services, however, it said that the managed infrastructure market space is considered to be “somewhat more challenged, which is making growth more difficult.”
The infrastructure market has come under intense pressure during the past years from US cloud giants such as Microsoft Azure and Amazon Web Services.
However, Computacenter chose to stick to its July trading update for the whole of this year, saying that core drivers of cybersecurity, networking, and cloud services “remain robust.”
The company stated: “We remain confident in our ability to gain infrastructure managed services market share due to our focus on innovation and productivity improvements.”