Unisys Singed

There's little sympathy this week for tech firms that have lowered earnings projections. In today's turgid episode of As the IT Turns, spooked investors dropped Unisys (NYSE: UIS  ) 14% this morning after it issued a revision to its revenue and profit outlook.

The firm said it expects second-quarter revenues to come in around $1.39 billion, with "earnings" to reach only $0.10 to $0.11 per share -- before pension accounting. (Bonus mini-rant: How about giving us the real numbers first, folks? Let's stop trying to give investors the impression that little things like pensions are unusual items.)

Management's final tally hopes for $0.05 to $0.06 per share, down from the $0.16 per stub achieved in the prior-year quarter. The lowered expectations not only undercut last year's results, they came in well under previous guidance and analyst estimates. Management blamed flat service revenues and the big drop in technology sales on deferrals. Shareholders will be able to check that excuse in the future, looking for better-than-expected results once this delayed revenue comes in.

In an interesting look at R&D issues, Fool contributor Ben McClure recently cited Unisys as an example of a company that's "milking" it, rather than innovating. (I'm sure the folks at the home office loved that characterization.) While I hesitate to knock high-margin exploitation of established technological knowledge, relying on the past can get a tech firm spanked.

That may or may not be the real problem here, but either way, there's little room for a stumble. This is a tough sector, with stiff competition from IBM (NYSE: IBM  ) , Accenture (NYSE: ACN  ) , Computer Sciences (NYSE: CSC  ) , BearingPoint (NYSE: BE  ) , Electronic Data Systems (NYSE: EDS  ) , Hewlett-Packard (NYSE: HPQ  ) , and plenty of smaller movers.

Current and prospective Unisys investors had better take a hard look at next week's full earnings release before making up their minds on the firm's prospects.

Fool contributor Seth Jayson has no position in any company mentioned. View his Fool profile here.