SECURITIES AND EXCHANGE COMMISSION

                     WASHINGTON, D.C.  20549

                            FORM 10-K

(Mark One)

 ___     ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
[_X_]    SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 1995

                               OR

 ___     TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
[___]    OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ____________ to ____________.

                 Commission file number:  1-8729

                       UNISYS CORPORATION

     (Exact name of registrant as specified in its charter)

            Delaware                             38-0387840
(State or other jurisdiction of               (I.R.S. Employer
incorporation or organization)               Identification No.)

Township Line and Union Meeting Roads
Blue Bell, Pennsylvania                             19424
(Address of principal executive offices)          (Zip Code)

       Registrant's telephone number, including area code:
                         (215) 986-4011

   Securities registered pursuant to Section 12(b) of the Act:

                                       Name of each exchange on
    Title of each class                     which registered
    -------------------                ------------------------

Common Stock, par value $.01           New York Stock Exchange
Series A Cumulative Convertible
  Preferred Stock, par value
  $1, $3.75 annual fixed dividend      New York Stock Exchange
Preferred Share Purchase Rights        New York Stock Exchange
10.30% Credit Sensitive Notes
  Due July 1, 1997                     New York Stock Exchange
8 1/4% Convertible Subordinated
  Notes Due 2000                       New York Stock Exchange

   Securities registered pursuant to Section 12(g) of the Act:

                              None

<PAGE>
                              -2-

Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrant was required to
file such reports), and (2) has been subject to such filing
requirements for the past 90 days.  YES   X     NO ____

Indicate by check mark if disclosure of delinquent filers
pursuant to Item 405 of Regulation S-K is not contained herein,
and will not be contained, to the best of registrant's
knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K.  [   ]

Aggregate market value of the voting stock held by non-
affiliates:  approximately $1,284,297,645 as of January 31, 1996.
The amount shown is based on the closing price of Unisys Common
Stock as reported on the New York Stock Exchange composite tape
on that date.  Voting stock beneficially held by officers and
directors is not included in the computation.  However, Unisys
Corporation has not determined that such individuals are
"affiliates" within the meaning of Rule 405 under the Securities
Act of 1933.

Number of shares of Unisys Common Stock, par value $.01,
outstanding as of January 31, 1996:  171,429,516.

               DOCUMENTS INCORPORATED BY REFERENCE


Portions of the Unisys Corporation 1995 Annual Report to
Stockholders -- Part I, Part II and Part IV.

Portions of the Unisys Corporation Proxy Statement for 1996
Annual Meeting of Stockholders -- Part III.

<PAGE>
                              -3-


                             PART I



ITEM 1.  BUSINESS
- -----------------

     Unisys Corporation ("Unisys") is an information management
company that provides information services, technology, software
and customer support on a worldwide basis.

     Unisys operates in the information management business
segment.  Financial information concerning revenue, operating
profit and identifiable assets relevant to the segment is set
forth in Note 14, "Business segment information", of the Notes to
Consolidated Financial Statements appearing in the Unisys 1995
Annual Report to Stockholders, and such information is incorporated
herein by reference.

     In 1995 Unisys sold its defense business to Loral Corporation.
In the fourth quarter of 1995, Unisys announced that it would realign 
internally into three business units: information services, computer 
systems and support services.

     Principal executive offices of Unisys are located at
Township Line and Union Meeting Roads, Blue Bell, Pennsylvania
19424.

Principal Products and Services
- -------------------------------

     Principal information management products and services
include enterprise systems and servers, departmental servers and
desktop systems, software, information services and systems
integration, and equipment maintenance.

     Enterprise systems and servers comprise a complete line of
small to large processors and related communications and
peripheral products, such as printers, storage devices and
document handling processors and equipment.  Departmental servers
and desktop systems include UNIX servers, workstations, personal
computers, and terminals.  Software consists of application and
systems software.  Information services and systems integration
includes systems integration, outsourcing services, application
development, information planning, and education.  Equipment
maintenance results from charges for preventive maintenance, spare
parts, and other repair activities.
___________________
UNIX is a registered trademark licensed in the United States and
other countries, exclusively by X/Open Company, Ltd.

<PAGE>
                              -4-

     Information about revenue from classes of similar products
and services for the three years ended December 31, 1995,
appears under the heading "Revenue by similar classes of
products and services" appearing in the Unisys 1995 Annual Report
to Stockholders, and such information is incorporated herein
by reference.

     Unisys markets its products and services throughout most of
the world, primarily through a direct sales force.  In certain
foreign countries, Unisys markets primarily through distributors.
Unisys manufactures a significant portion of its product lines.
Some products, including certain personal computers, peripheral
products, electronic components and subassemblies and software
products, are manufactured for Unisys to its design or
specifications by other business equipment manufacturers,
component manufacturers or software suppliers.

Raw Materials
- -------------

     Raw materials essential to the conduct of the business are
generally readily available at competitive prices in reasonable
proximity to those plants utilizing such materials.

Patents, Trademarks and Licenses
- --------------------------------

     Unisys owns many domestic and foreign patents relating to
the design and manufacture of its products, has granted licenses
under certain of its patents to others and is licensed under the
patents of others.  Unisys does not believe that its business is
materially dependent upon any single patent or license or
related group thereof.  Trademarks used on or in connection with
Unisys products are considered to be valuable assets of Unisys.

Backlog
- -------

     Unisys does not accumulate backlog information on a
company-wide basis.  Unisys believes that backlog is not a
meaningful indicator of future revenues due to the significant
portion of Unisys revenue received from software, information
services and systems integration, and equipment maintenance
(approximately 69% in 1995) and the shortening of the time
period from receipt of a purchase order to billing upon shipment
of equipment.  Unisys "lead time" for commercial equipment (the
time that customers are told that it will take from receipt of
an order to shipment) is between 13 and 150 days depending upon
the type of system and location of customer.  However, the
average is between 35 and 45 days.  Therefore, Unisys believes
that the dollar amount of backlog is not material to an
understanding of its business taken as a whole.


<PAGE>
                              -5-

Customers
- ---------

     No single customer accounts for more than 10% of Unisys
revenue.  Sales of commercial products to various agencies of the
U.S. government represented 9% of total consolidated revenue in
1995.

Competition
- -----------

     Unisys business is affected by rapid change in technology
in the information systems and services field and aggressive
competition from many domestic and foreign companies, including
computer hardware manufacturers, software providers and
information services companies.  Unisys competes primarily on
the basis of product performance, service, technological
innovation and price.  Unisys believes that its continued
investment in engineering and research and development, coupled
with its marketing capabilities, will have a favorable impact on
its competitive position.

Research and Development
- ------------------------

     Unisys-sponsored research and development costs were $409.5
million in 1995, $463.6 million in 1994 and $489.3 million in
1993.

Environmental Matters
- ---------------------

     Capital expenditures, earnings and the competitive position
of Unisys have not been materially affected by compliance with
federal, state and local laws regulating the protection of the
environment.  Capital expenditures for environmental control
facilities are not expected to be material in 1996 and 1997.

Employees
- ---------

     As of December 31, 1995, Unisys had approximately 37,400
employees.


<PAGE>
                              -6-

International and Domestic Operations
- -------------------------------------

     Financial information by geographic area is set forth in
Note 14, "Business segment information", of the Notes to
Consolidated Financial Statements appearing in the Unisys 1995
Annual Report to Stockholders, and such information is
incorporated herein by reference.


I
TEM 2.  PROPERTIES
- -------------------

     In the United States, Unisys had 47 major facilities, each
having approximately 50,000 square feet of floor space or more,
as of December 31, 1995.  The aggregate floor space of these
major facilities was approximately 8,914,041 square feet, of
which an aggregate of approximately 7,905,787 square feet was
located in the following states:  California, Illinois,
Michigan, Minnesota, Pennsylvania, Utah and Virginia.  Nine of
the major facilities in the United States, with an aggregate of
approximately 2,286,706 square feet of floor space, were owned by
Unisys while 38 of the major facilities in the United States,
with approximately 6,627,335 square feet of floor space, were
leased to Unisys.  Of the aggregate floor space of major
facilities in the United States, approximately 7,327,846 square
feet were in current operation, approximately 1,284,510 square
feet were subleased to others and approximately 301,685 square
feet were being held in reserve or were declared surplus with
disposition efforts in progress.

     Outside of the United States, Unisys had 40 major
facilities, each having approximately 50,000 square feet of
floor space or more, as of December 31, 1995.  The aggregate
floor space of these major facilities was approximately
4,165,902 square feet, of which an aggregate of approximately
3,095,301 square feet was located in the following countries:
Brazil, Canada, France, Germany, the Netherlands, Switzerland and
the United Kingdom.  Eight of the major facilities outside the
United States, with approximately 1,206,937 square feet of floor
space, were owned by Unisys while 32 of the major facilities
outside the United States, with approximately 2,958,965 square
feet of floor  space, were leased to Unisys.  Of the aggregate
floor space of major facilities outside the United States,
approximately 2,477,911 square feet were in current operation,
approximately 245,872 square feet were subleased to others and
approximately 1,442,119 square feet were being held in reserve or
were declared surplus with disposition efforts in progress.


<PAGE>
                              -7-

     Unisys major facilities include offices, laboratories,
manufacturing plants, warehouses and distribution and sales
centers.  Unisys believes that its facilities are suitable and
adequate for current and presently projected needs.  Unisys
continuously reviews its anticipated requirements for
facilities, and, on the basis thereof, will from time to time
acquire additional facilities, expand existing facilities and
dispose of existing facilities or parts thereof.


ITEM 3.  LEGAL PROCEEDINGS
- --------------------------

     As of January 31, 1996, Unisys has no material pending legal
proceedings reportable under the requirements of this Item 3.


ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
- ------------------------------------------------------------

     No matters were submitted to a vote of security holders of
Unisys during the fourth quarter of 1995.


ITEM 10.  EXECUTIVE OFFICERS OF THE REGISTRANT
- ----------------------------------------------

     Information concerning the executive officers of Unisys set
forth below is as of January 31, 1996.

     Name                     Age        Position with Unisys
     ----                     ---        --------------------

James A. Unruh                54       Chairman of the Board
                                         and Chief Executive
                                         Officer

Alan G. Lutz                  50       Executive Vice President;
                                         President, Computer
                                         Systems Group

Lawrence C. Russell           57       Executive Vice President;
                                         President, Information
                                         Services Group

Harold S. Barron              59       Senior Vice President,
                                         General Counsel and
                                         Secretary

Edward A. Blechschmidt        43       Senior Vice President,
                                         Chief Financial Officer
                                         and Controller

<PAGE>
                              -8-

Malcolm D. Coster             51       Senior Vice President,
                                         Strategic Business
                                         Development

Gerald A. Gagliardi           48       Senior Vice President;
                                         President, Global Customer
                                         Services Group

Dewaine L. Osman              61       Senior Vice President,
                                         Information Technology and
                                         Strategic Development, and
                                         President, Pacific
                                         Asia/Americas Group

David O. Aker                 49       Vice President, Worldwide
                                         Human Resources

Jack A. Blaine                51       Vice President;
                                         President,
                                         Latin America and
                                         Caribbean Division

Frank G. Brandenberg          49       Vice President; Group Vice
                                         President and General Manager,
                                         Client/Server Systems

George R. Gazerwitz           55       Vice President;
                                         President,
                                         Japan Operations

Patricia L. Higgins           46       Vice President; Group Vice
                                         President and General Manager,
                                         Worldwide Communications
                                         Market Sector Group

John J. Holton                62       Vice President,
                                         Client Relations

Jack F. McHale                46       Vice President,
                                         Investor and Corporate
                                         Communications

<PAGE>
                              -9-

Stefan C. Riesenfeld          47       Vice President and
                                         Treasurer

William G. Rowan              53       Vice President, Finance,
                                         Pacific Asia/Americas
                                         Group


     There are no family relationships among any of the above-
named executive officers.  The Bylaws provide that the officers
of Unisys shall be elected annually by the Board of Directors
and that each officer shall hold office for a term of one year
and until a successor is elected and qualified, or until the
officer's earlier resignation or removal.

     Mr. Unruh has been the Chairman of the Board and Chief
Executive Officer since 1990.  He was President and Chief
Operating Officer from 1989 to 1990 and Executive Vice President
from 1986 to 1989.  He has also held the position of Senior Vice
President and Chief Financial Officer.  Mr. Unruh has been a
member of the Board of Directors since 1986 and has been an
officer since 1982.

     Mr. Lutz has been an Executive Vice President of Unisys and
President of Unisys Computer Systems Group since 1994.   He was
President of the Kassandra Group, a technology and product
consulting firm to the telecommunications industry from 1993 to
1994.  From 1987 to 1993, he held numerous positions with
Northern Telecom, including President of Switching Networks and
President of Public Networks.  Mr. Lutz has been an officer
since 1994.

     Mr. Russell was elected an Executive Vice President of Unisys
and President of Unisys Information Services Group in November
1995.  He was an officer of The First Manhattan Consulting Group,
a management consulting firm, from 1993 to 1995.  He was Chairman
and Chief Executive Officer of Palaru Corporation, a printing
company, from 1990 to 1993.  Mr. Russell has been an officer
since November 1995.

     Mr. Barron has been Senior Vice President and General Counsel
of Unisys since 1992.  In April 1994, he was also elected
Secretary.  He was Vice President and General Counsel from 1991
to 1992 and a member of the law firm Seyfarth, Shaw, Fairweather
and Geraldson from 1986 to 1991.  Mr. Barron has been an officer
since 1991.

     Mr. Blechschmidt was elected Senior Vice President, Chief
Financial Officer and Controller of Unisys in January 1996.  He
was President of the United States/Canada Division from January
1995 to December 1995.  He was elected a Senior Vice President
of Unisys in 1994.  He was a Vice President of Unisys and
President of the Pacific Asia Americas Division from 1990 to
January 1995.  Mr. Blechschmidt has been an officer since 1990.


<PAGE>
                              -10-

     Mr. Coster has been a Senior Vice President, Strategic
Business Development since January 1996.  He was elected a Senior
Vice President of Unisys and named President, Europe-Africa
Division in 1994.  He was an Executive Partner of Coopers &
Lybrand responsible for the management consulting practice and
head of worldwide business development from 1986 to 1994.
Mr. Coster has been an officer since 1994.

     Mr. Gagliardi was elected a Senior Vice President of Unisys
in October 1995 and named President of Global Customer Services
in June 1995.  He had been Vice President, Customer Services
Worldwide since 1994 and Vice President and General Manager,
Customer Services and Support from 1991 to 1994.  Mr. Gagliardi
has been an officer since 1994.

     Mr. Osman was elected a Senior Vice President, Information
Technology and Strategic Development and President, Pacific
Asia/Americas Group in July 1995.  He had been Vice President,
Corporate Planning and Business Development, since 1992.  He was
acting Vice President, Commercial Marketing from 1993 to 1994.
Prior to 1992, he had been President of Ascom Timeplex, Inc.
(formerly Timeplex, Inc., the communications networking
subsidiary of Unisys) since its divestiture by Unisys in 1991.
From 1986 to 1991, Mr. Osman was an officer of Unisys, serving
as President of the Communications and Networks Group and as
President of Timeplex, Inc. from 1989 to 1991.  He was
reelected an officer in 1992.

     Mr. Aker was elected Vice President of Unisys Worldwide Human
Resources in July 1995.  He had been Vice President, Human
Resources, Information Services and Systems Group from 1994 to
1995.  From 1990 to 1994, he was Vice President, Human Resources
and Administration of Rolls-Royce of North America and a director
of its subsidiary, Rolls-Royce Incorporated.  Prior to 1990,
Mr. Aker held several Human Resources positions with Unisys.
Mr. Aker has been an officer since July 1995.

     Mr. Blaine has been a Vice President of Unisys and President,
Latin America and Caribbean Division since 1995.  Mr. Blaine was
Vice President and General Manager, Latin America and Caribbean
Group, of the Pacific Asia Americas Division from 1990 to 1995.
Mr. Blaine has been an officer since 1988.

     Mr. Brandenberg has been a Vice President of Unisys and the
Group Vice President and General Manager, Client/Server Systems,
since 1994.  He was Vice President and Deputy President of the
Computer Systems Group from 1992 to 1994; and Vice President and
General Manager of the Computer Systems Group from 1990 to 1992.
Mr. Brandenberg has been an officer since 1990.

     Mr. Gazerwitz has been Vice President and President, Japan
Operations since 1994.  He had been Vice President, Marketing,
of the United States Division from 1992 to 1994 and Vice
President and Group Vice President, Eastern Region, United States
Information Systems from 1990 to 1992.  Mr. Gazerwitz has been an
officer since 1984.

<PAGE>
                              -11-

     Ms. Higgins was elected a Vice President of Unisys and
named Group Vice President and General Manager, Worldwide
Communications Market Sector Group in 1995.  She was the Group
Vice President, Manhattan Market Area, and a corporate officer of
NYNEX Corporation from 1991 to December 1994.  From 1977 to 1991,
Ms. Higgins held numerous positions at AT&T, including Vice
President of International Sales Operations and Service Vice
President in Business Communications Services.  Ms. Higgins has
been an officer since 1995.

     Mr. Holton has been a Vice President of Unisys and Vice
President, Client Relations since October 1995.  He was Vice
President Strategic Account Marketing, United States/Canada
Division from 1990 to October 1995.  He was Vice President,
Corporate Marketing, from 1989 to 1990.  Mr. Holton has been an
officer since 1985.

     Mr. McHale has been Vice President, Investor and Corporate
Communications, since 1989.  He was Vice President, Public and
Investor Relations, from 1986 to 1989.  Mr. McHale has been an
officer since 1986.

     Mr. Riesenfeld has been Vice President and Treasurer since
1989.  He was Vice President, Corporate Development, from 1986
to 1989.  Mr. Riesenfeld has been an officer since 1988.

     Mr. Rowan has been a Vice President of Unisys and Vice
President of Finance, Pacific Asia/Americas Group since 1995.
He had been Chief Information Officer from 1992 to 1995.  He was
Vice President and Controller from 1991 to 1992; Vice President,
Business Operations, from February to April 1991; and Vice
President, Finance, of the Pacific Asia/Americas Division from
1986 to 1991.  Mr. Rowan has been an officer since 1991.


<PAGE>
                              -12-


                             PART II



ITEM 5.  MARKET FOR THE REGISTRANT'S COMMON STOCK AND RELATED
- -------------------------------------------------------------
STOCKHOLDER MATTERS
- -------------------

     Information as to the markets for Unisys Common Stock, the
high and low sales prices for Unisys Common Stock, the
approximate number of record holders of Unisys Common Stock, the
payment of dividends, and restrictions on such payment is set
forth under the headings "Quarterly financial information",
"Five-year summary of selected financial data", "Common Stock
Information", "Management's Discussion and Analysis of Financial
Condition and Results of Operations" and Notes 9 and 16 of the
Notes to Consolidated Financial Statements in the Unisys 1995
Annual Report to Stockholders and is incorporated herein by
reference.  The approximate number of holders is based upon
record holders as of December 31, 1995.


ITEM 6.  SELECTED FINANCIAL DATA
- --------------------------------

     A summary of selected financial data for Unisys for each of
the last five years is set forth under the heading "Five-year
summary of selected financial data" in the Unisys 1995 Annual
Report to Stockholders and is incorporated herein by reference.


ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
- ----------------------------------------------------------
         CONDITION AND RESULTS OF OPERATIONS
         -----------------------------------

     Management's discussion and analysis of financial condition,
changes in financial condition and results of operations is set
forth under the heading "Management's Discussion and Analysis of
Financial Condition and Results of Operations" in the Unisys
1995 Annual Report to Stockholders and is incorporated herein by
reference.

<PAGE>
                              -13-


I
TEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
- ----------------------------------------------------

     The financial statements of Unisys, consisting of the
consolidated balance sheet at December 31, 1995 and 1994 and the
related consolidated statements of income and cash flows for
each of the three years in the period ended December 31, 1995,
appearing in the Unisys 1995 Annual Report to Stockholders,
together with the report of Ernst & Young LLP, independent
auditors, on the financial statements at December 31, 1995 and
1994 and for each of the three years in the period ended
December 31, 1995, appearing in the Unisys 1995 Annual Report to
Stockholders, are incorporated herein by reference.  Supplementary
financial data, consisting of information appearing under the
heading "Quarterly financial information" in the Unisys 1995
Annual Report to Stockholders, is incorporated herein by reference.


ITEM 9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
- ------------------------------------------------------
         ON ACCOUNTING AND FINANCIAL DISCLOSURE
         --------------------------------------

     Not applicable.


                           PART III


ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
- -----------------------------------------------------------

     (a)  Identification of Directors.  Information concerning
the directors of Unisys Corporation is set forth under the
headings "Nominees for Election to the Board of Directors",
"Members of the Board of Directors Continuing in Office -- Term
Expiring in 1997" and "Members of the Board of Directors
Continuing in Office -- Term Expiring in 1998" in the Unisys
Proxy Statement for the 1996 Annual Meeting of Stockholders
and is incorporated herein by reference.

     (b)  Identification of Executive Officers.  Information
concerning executive officers of Unisys Corporation is set forth
under the caption "EXECUTIVE OFFICERS OF THE REGISTRANT" in
Part I, Item 10, of this report.


ITEM 11. EXECUTIVE COMPENSATION
- -------------------------------

     Information concerning executive compensation is set forth
under the heading "EXECUTIVE COMPENSATION" in the Unisys Proxy
Statement for the 1996 Annual Meeting of Stockholders and is
incorporated herein by reference.


<PAGE>
                              -14-


ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
         OWNERS AND MANAGEMENT
- -------------------------------------------------

     (a)  Security Ownership of Certain Beneficial Owners.  The
TCW Group, Inc. (865 South Figueroa Street, Los Angeles,
California 90017) and Robert Day (200 Park Avenue, Suite 2200,
New York, New York 10166) have jointly filed a Schedule 13G with
the Securities and Exchange Commission dated February 12, 1996
reporting beneficial ownership of 10,354,912 shares of Unisys
Common Stock.  Such shares represented approximately 6.0% of the
total outstanding shares of Unisys Common Stock as of January 31,
1996.  The TCW Group, Inc. and Robert Day have jointly reported
sole voting power and sole dispositive power with respect to all
such shares.  To Unisys knowledge, as of January 31, 1996, no other
person was the beneficial owner of more than 5% of the total
outstanding shares of Unisys Common Stock.

     (b)  Security Ownership of Management.  Certain information
furnished by members of management with respect to shares of
Unisys equity securities beneficially owned as of March 1, 1996
by all directors individually, by certain named officers and by
all directors and officers of Unisys as a group is set forth
under the heading "SECURITY OWNERSHIP BY CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT" in the Unisys Proxy Statement for the
1996 Annual Meeting of Stockholders and is incorporated herein
by reference.


ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
- -------------------------------------------------------

     Information concerning certain relationships and
transactions between Unisys and members of its management is set
forth under the headings "EXECUTIVE COMPENSATION" and "REPORT OF
THE COMPENSATION AND ORGANIZATION COMMITTEE -- Compensation
Committee Interlocks and Insider Participation" in the Unisys
Proxy Statement for the 1996 Annual Meeting of Stockholders
and is incorporated herein by reference.


                              PART IV


ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS
- -------------------------------------------------------------
         ON FORM 8-K
         -----------

(a) The following documents are filed as part of this report:

1.  Financial Statements from the Unisys 1995 Annual Report to
    Stockholders which are incorporated herein by reference:

<PAGE>
                              -15-

                                                   Annual Report
                                                     Page No.
                                                   -------------
Consolidated Balance Sheet at
  December 31, 1995 and December 31, 1994...............11

Consolidated Statement of Income for each of the
  three years in the period ended December 31, 1995..... 9

Consolidated Statement of Cash Flows for each of the
  three years in the period ended December 31, 1995.....13

Notes to Consolidated Financial Statements..............15-27

Report of Independent Auditors..........................28

2.   Financial Statement Schedules filed as part of this report
     pursuant to Item 8 of this report:

Schedule                                            Form 10-K
 Number                                              Page No.
- --------                                            ---------

II     Valuation and Qualifying Accounts................18

     The financial statement schedule should be read in
conjunction with the consolidated financial statements and notes
thereto in the Unisys 1995 Annual Report to Stockholders.
Financial statement schedules not included with this report have
been omitted because they are not applicable or the required
information is shown in the consolidated financial statements or
notes thereto.

     Separate financial statements of subsidiaries not
consolidated with Unisys and entities in which Unisys has a
fifty percent or less ownership interest have been omitted since
these operations do not meet any of the conditions set forth in
Rule 3-09 of Regulation S-X.

3.  Exhibits.  Those exhibits required to be filed by Item 601
of Regulation S-K are listed in the Exhibit Index included in
this report at pages 19 through 22.  Management contracts and
compensatory plans and arrangements are listed as Exhibits 10.1
through 10.24.

(b) Reports on Form 8-K.

     During the quarter ended December 31, 1995, no Current
Reports on Form 8-K were filed.


<PAGE>
                              -16-


                           SIGNATURES


     Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, the registrant has duly caused
this report to be signed on its behalf by the undersigned,
thereunto duly authorized.

                                UNISYS CORPORATION

                                By: /s/ James A. Unruh
                                    James A. Unruh
                                    Chairman of the Board
                                    and Chief Executive Officer

                                Date: February 21, 1996

     Pursuant to the requirements of the Securities Exchange
Act of 1934, this report has been signed below by the following
persons on behalf of the registrant and in the capacities
indicated on February 21, 1996.

/s/ James A. Unruh              *Melvin R. Goodes
- ---------------------           ---------------------
James A. Unruh                   Melvin R. Goodes
Chairman of the Board            Director
and Chief Executive
Officer (principal
executive officer) and
Director

/s/ Edward A. Blechschmidt      *Edwin A. Huston
- ---------------------           ---------------------
Edward A. Blechschmidt           Edwin A. Huston
Senior Vice President,           Director
Chief Financial Officer
and Controller (principal
financial and accounting
officer)

*J. P. Bolduc                   *Kenneth A. Macke
- ---------------------           ---------------------
 J. P. Bolduc                    Kenneth A. Macke
 Director                        Director

*James J. Duderstadt            *Theodore E. Martin
- ---------------------           ---------------------
 James J. Duderstadt             Theodore E. Martin
 Director                        Director

<PAGE>
                              -17-


*Gail D. Fosler                 *Robert McClements, Jr.
- ---------------------           -----------------------
 Gail D. Fosler                  Robert McClements, Jr.
 Director                        Director

                                *Alan E. Schwartz
                                -----------------------
                                 Alan E. Schwartz
                                 Director







                                *By:/s/ Edward A. Blechschmidt
                                    -----------------------
                                        Edward A. Blechschmidt
                                        Attorney-in-Fact

<PAGE>
                                      -18-
                               UNISYS CORPORATION
                 SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS
                                   (Millions)


                                           Additions
                                Balance at Charged                    Balance
                                Beginning  to Costs                   at End
Description                     of Period  and Expenses Deductions(a) of Period
- ------------------------------- ---------- ------------ ------------- ---------

Allowance for Doubtful Accounts
  (deducted from accounts and
  notes receivable):

Year Ended December 31, 1993      $101.7      $  9.6       $(32.6)      $78.7

Year Ended December 31, 1994        78.7         5.4         (9.6)       74.5

Year Ended December 31, 1995        74.5        21.0         (8.8)       86.7



(a) Write-off of bad debts less recoveries.



Note: Prior year amounts have been restated in reporting the
      Defense Systems business as a discontinued operation.

<PAGE>
                              -19-


                          EXHIBIT INDEX

Exhibit
Number                            Description
- -------                           -----------

 3.1        Restated Certificate of Incorporation of Unisys
            Corporation, incorporated by reference to Exhibit
            3(a) to the registrant's Annual Report on Form 10-K
            for the year ended December 31, 1992.

 3.2        By-Laws of Unisys Corporation, incorporated by
            reference to Exhibit 3 to the registrant's Quarterly
            Report on Form 10-Q for the quarterly period ended
            June 30, 1995.

 4.1        Agreement to furnish to the Commission on request a
            copy of any instrument defining the rights of the
            holders of long-term debt which authorizes a total
            amount of debt not exceeding 10% of the total assets
            of the registrant, incorporated by reference to
            Exhibit 4 to the registrant's Annual Report on Form
            10-K for the year ended December 31, 1982 (File No.
            1-145).

 4.2        Form of Rights Agreement dated as of March 7, 1986
            between Burroughs Corporation and Harris Trust
            Company of New York, as Rights Agent, which includes
            as Exhibit A, the Certificate of Designations for
            the Junior Participating Preferred Stock, and as
            Exhibit B, the Form of Rights Certificate,
            incorporated by reference to Exhibit 1 to the
            registrant's Registration Statement on Form 8-A,
            dated March 11, 1986.

 4.3        Second Rights Agreement, dated as of June 28, 1990,
            by and between registrant and Mitsui & Co., Ltd. and
            joined by Harris Trust Company of New York,
            incorporated by reference to Exhibit 4.4 to the
            registrant's Current Report on Form 8-K dated
            June 28, 1990.

 4.4        Purchase Agreement, dated as of June 25, 1990,
            between the registrant and Mitsui & Co., Ltd.,
            incorporated by reference to Exhibit 4.3 to the
            registrant's Current Report on Form 8-K dated
            June 28, 1990.

10.1        Deferred Compensation Plan for Executives of Unisys
            Corporation, effective November 1, 1994, incorporated
            by reference to Exhibit 10.2 to the registrant's
            Quarterly Report on Form 10-Q for the quarterly
            period ended September 30, 1994.



<PAGE>
                              -20-

10.2        Deferred Compensation Plan for Directors of Unisys
            Corporation, as amended and restated as of January
            1, 1994, incorporated by reference to Exhibit 10.2
            to the registrant's Annual Report on Form 10-K for
            the year ended December 31, 1993.

10.3        Form of Executive Employment Agreement, incorporated
            by reference to Exhibit 10.1 to the registrant's
            Quarterly Report on Form 10-Q for the quarterly period
            ended June 30, 1995.

10.4        Agreement, dated October 17, 1995, between the
            registrant and Lawrence C. Russell.

10.5        Employment Agreement, dated August 10, 1994,
            between the registrant and James A. Unruh,
            incorporated by reference to Exhibit 10.1 to the
            registrant's Quarterly Report on Form 10-Q for the
            quarterly period ended September 30, 1994.

10.6        Amendment, dated as of July 28, 1995, to Employment
            Agreement, dated August 10, 1994, between the
            registrant and James A. Unruh, incorporated by
            reference to Exhibit 10.4 to the registrant's
            Quarterly Report on Form 10-Q for the quarterly
            period ended June 30, 1995.

10.7        Stock Unit Plan for Directors of Unisys Corporation,
            as amended and restated as of September 23, 1993,
            incorporated by reference to Exhibit 10 to the
            registrant's Quarterly Report on Form 10-Q for the
            quarterly period ended September 30, 1993.

10.8        Summary of supplemental executive benefits provided
            to officers of Unisys Corporation, incorporated by
            reference to Exhibit 10(k) of the registrant's
            Annual Report on Form 10-K for the year ended
            December 31, 1992.

10.9        Unisys Executive Annual Variable Compensation Plan,
            incorporated by reference to Exhibit A to the
            registrant's Proxy Statement, dated March 23, 1993,
            for its 1993 Annual Meeting of Stockholders.

10.10       1982 Unisys Long-Term Incentive Plan, as amended and
            restated through September 1, 1989, incorporated by
            reference to Exhibit 10(p) to the registrant's
            Annual Report on Form 10-K for the year ended
            December 31, 1990.

<PAGE>
                              -21-

10.11       Amendment, dated December 11, 1989, to the 1982
            Unisys Long-Term Incentive Plan, incorporated by
            reference to Exhibit 10(o) to the registrant's
            Annual Report on Form 10-K for the year ended
            December 31, 1989.

10.12       Amendment, dated July 25, 1990, to 1982 Unisys Long-
            Term Incentive Plan, incorporated by reference to
            Exhibit 10(r) to the registrant's Annual Report on
            Form 10-K for the year ended December 31, 1990.

10.13       1990 Unisys Long-Term Incentive Plan, effective as
            of January 1, 1990 incorporated by reference to
            Exhibit A to the registrant's Proxy Statement, dated
            March 20, 1990, for its 1990 Annual Meeting of
            Stockholders.

10.14       Amendment, dated May 26, 1994, to 1990 Unisys
            Long-Term Incentive Plan, effective as of
            February 22, 1990, incorporated by reference to
            Exhibit 10.15 to the registrant's Annual Report on
            Form 10-K for the year ended December 31, 1994.

10.15       Amendment, dated May 25, 1995, to 1990 Unisys Long-
            Term Incentive Plan, incorporated by reference to
            Exhibit 10.2 to the registrant's Quarterly Report on
            Form 10-Q for the quarterly period ended June 30, 1995.

10.16       Form of Loan Agreement including Note used for
            bridge loans to executive officers purchasing
            residences, incorporated by reference to Exhibit
            10(kk) to the registrant's Annual Report on Form 10-
            K for the year ended December 31, 1986.

10.17       Form of Loan Agreement including Note used for term
            loans to executive officers purchasing residences,
            incorporated by reference to Exhibit 10(ll) to the
            registrant's Annual Report on Form 10-K for the year
            ended December 31, 1986.

10.18       Unisys Corporation Officers' Car Allowance Program,
            effective as of July 1, 1991, incorporated by
            reference to Exhibit 10(hh) to the registrant's
            Annual Report on Form 10-K for the year ended
            December 31, 1991.

10.19       Form of Indemnification Agreement between Unisys
            Corporation and each of its Directors, incorporated
            by reference to Exhibit B to the registrant's Proxy
            Statement, dated March 22, 1988, for the 1988 Annual
            Meeting of Stockholders.

10.20       Unisys Corporation Elected Officer Pension Plan,
            effective June 1, 1988, incorporated by reference to
            Exhibit 10(zz) to the registrant's Annual Report on
            Form 10-K for the year ended December 31, 1988.

<PAGE>
                              -22-

10.21       Amendment, dated February 27, 1992, to Unisys
            Corporation Elected Officers' Pension Plan,
            incorporated by reference to Exhibit 10(x) to the
            registrant's Annual Report on Form 10-K for the year
            ended December 31, 1992.

10.22       Amendment, dated July 28, 1994, to Unisys Corporation
            Elected Officer Pension Plan, effective July 28, 1994,
            incorporated by reference to Exhibit 10.23 to the
            registrant's Annual Report on Form 10-K for the year
            ended December 31, 1994.

10.23       Amendment, dated May 25, 1995, to Unisys Corporation
            Elected Officer Pension Plan, incorporated by
            reference to Exhibit 10.3 to the registrant's
            Quarterly Report on Form 10-Q for the quarterly period
            ended June 30, 1995.

10.24       Unisys Corporation Supplemental Executive Retirement
            Income Plan, as amended and restated effective
            April 1, 1988, incorporated by reference to Exhibit
            10(aaa) to the registrant's Annual Report on Form
            10-K for the year ended December 31, 1988.

11          Computation of Earnings Per Share.

12          Computation of Ratio of Earnings to Fixed Charges.

13          Portions of the Annual Report to Stockholders of the
            registrant for the year ended December 31, 1995.

21          Subsidiaries of Unisys Corporation.

23          Consent of Ernst & Young LLP.

24          Power of Attorney.

27          Financial Data Schedule.




October 17, 1995


Mr. Lawrence C. Russell
1117 Michigan Avenue
Wilmette, Illinois  60091

Dear Larry:

On behalf of Unisys Corporation, I am pleased to offer you the position of
Executive Vice President of Unisys and President, Information Services Group,
reporting directly to James A. Unruh, Chairman and Chief Executive Officer.
At the next Board of Directors meeting you will be recommended to be made an
elected officer of Unisys Corporation, effective upon employment.

1. The term of your employment under this agreement shall be three years
   commencing on your first day of employment.  If you are still employed
   by Unisys at the end of such term, this agreement shall be null and
   void, except that Unisys obligation to pay the amounts described in
   Section 6(a) and the pension benefit rights described in Section 7 shall
   not be affected by the end of such term.

2. Your salary will be at the annual rate of $450,000 and shall be subject
   to annual review for increase.  You will participate in the Executive
   Variable Compensation (EVC) Plan and your target will be not less than
   60% of your annual paid salary.  Your actual award under the EVC Plan
   can vary from zero to 150% of the target amount.  Your employment will
   commence on or about November
 6, 1995, or earlier, if you can make the
   necessary arrangements.  If your employment begins by November 6, 1995
   and you continue to be employed through the 1995 EVC payout date, you
   will be guaranteed a minimum EVC payout of $50,000 for 1995.  In
   addition, if you continue to be employed through the 1996 EVC payout
   date, we will guarantee you a minimum EVC payout for 1996 of 100% of
   target.

3. You will participate in an individual long term incentive plan
   commencing on January 1, 1996 with a target award after three years of
   $500,000.  Your actual award under this plan can vary from zero to 100%
   of the target amount.  Eighty percent of the award will be determined by
   attainment of financial objectives and 20% by attainment of non-
   financial objectives.  The objectives and award terms  are to be
   established by Unisys and described in a separate agreement or plan
   prior to December 31, 1995.

4. You will be recommended for a stock option grant under the terms of the
   1990 Unisys Long-Term Incentive Plan to be made at the next Board of
   Directors meeting.  You will be recommended for a grant of 250,000
   shares which will vest 50% after two years, 75% after three years and 100%

<PAGE>
Mr. Lawrence C. Russell
October 17, 1995
Page 2



   after four years from the effective date of grant.  This grant
   will be at the Fair Market Value on the date of the next Board meeting
   or on the first work day following your becoming an employee, if later.
   You will continue to be eligible to receive future stock grants at the
   same times as such grants are made to other elected officers.

5. You will receive all the supplemental executive benefits associated with
   an elected officer position, including a company car allowance of $600
   per month.  You also will be eligible for a membership in an approved
   luncheon club, an annual executive physical, deferred compensation,
   additional life insurance equal to four times annual salary plus target
   EVC, post-retirement life insurance of $1,000,000, umbrella personal
   liability insurance up to $5,000,000 and contribution toward financial
   counseling services of $7,500 for the first year and $5,000 per year
   thereafter.  In addition, you and your eligible dependents will be
   eligible to participate in all basic retirement, welfare and other
   benefit arrangements generally applicable to elected officers.  You will
   be entitled to receive four weeks of vacation each year.  Reasonable
   expenses associated with the performance of the duties of your position
   shall be reimbursed in accordance with normal Unisys policies.  Unisys
   shall reimburse you up to $7,500 for your legal expenses incurred in the
   negotiation of this agreement.

6. You agree to provide to Unisys on or before October 30, 1995
   satisfactory documentation regarding your compensation, and the value of
   incentives you are forfeiting, from your present employer.  To make up
   for the value of incentives that you are forfeiting from your present
   employer, Unisys agrees to the following:

  a)  If you continue to be employed with Unisys through the following
      dates, Unisys will make payments to you as follows:

              December 1, 1995 - $200,000

              November 1, 1997 - $200,000

              November 1, 1998 - $100,000

              November 1, 1999 - $100,000

              November 1, 2000 - $100,000

  b)  You will receive a restricted stock grant, effective on the date
      of the next Board of Directors meeting, or if later, on the first
      work day following your employment date, with a value equal to
      $100,000, based on the Fair Market Value of Unisys Common Stock
      on the effective date of the grant.  The grant will be made under

<PAGE>

Mr. Lawrence C. Russell
October 17, 1995
Page 3

      and will be subject to the terms of the 1990 Unisys Long-Term
      Incentive Plan.  The restrictions on the stock will lapse on
      November 1, 1998, provided that you continue to be employed with
      Unisys through that date.

  c)  In connection with your relocation to and your purchase of a home
      in the Philadelphia area, Unisys will extend to you an interest-free
      loan in the amount of the lesser of (i) the purchase price of such home
      or (ii) $500,000.  To secure the loan, Unisys will place a first
      mortgage on your new home.  The loan will be a recourse loan and
      will be payable over a five-year period with installment payments
      being due on November 6, 1997, 1998, and 1999, with the final
      payment being due November 6, 2000.  Upon your termination of
      employment for any reason, any outstanding amount of the loan will
      become due and payable six months after your termination date.
      The terms of the loan will be described by Unisys in a separate
      agreement to be executed by you.

7. You also will be eligible to participate in the Unisys Elected Officer
   Pension Plan which has minimum vesting requirements of age 55 with 10
   years of service and provides a minimum normal retirement benefit after
   10 years of service equal to 40% (4% per year of service) of final
   average earnings (base salary plus bonus).  Unisys agrees that you will
   become 100% vested at the end of five years of employment with Unisys in
   a pension benefit calculated and payable in accordance with the terms of
   the Unisys Elected Officer Pension Plan (which provides for an accrued
   benefit equal to one-third of one percent of your Final Average
   Compensation for each month of Credited Service under Section
   5.01(a)(1)), regardless of whether you had met the ten year eligibility
   requirement of such plan.

8. If your employment is terminated by Unisys without "cause" or you
   terminate your employment for "good reason", you shall be entitled to
   the following as the sole and  exclusive remedy for such termination:

  a)  Any remaining payments described in Section 6(a) shall become
      immediately payable;

  b)  All restrictions on any outstanding restricted stock grant shall
      immediately lapse;

  c)  All outstanding stock options shall immediately vest and you shall
      have thirty days following your termination date to
      exercise your stock options;

  d)  An amount equal to 100% of the compensation that would have been
      paid through the remaining term of this agreement as if you had
      continued to work through such remaining term, but in no event
      less than one year's compensation.  For purposes of this
      Section 8(d), compensation consists of base salary (at its then
      current rate on the date of termination) and EVC (in an amount
      equal to the average percentage of target EVC payout (which
      percentage shall be annualized for a partial year but shall be
      deemed to be 100% for 1995 whether or not any

<PAGE>
Mr. Lawrence C. Russell
October 17, 1995
Page 4


      EVC for 1995 is actually paid ) made to you since your date of
      employment times your base salary as in effect on your date of
      termination).  Such amounts shall be paid in the same manner and
      at the same times as if you had continued to work through the
      remaining term;

  e)  Continued participation, at the same costs applicable to active
      employees, through the remaining term of this agreement, in the
      Unisys Medical and Dental Plans (or, if such participation is
      prohibited by applicable law or the terms of the plans,
      participation in arrangements that will provide benefits
      substantially similar to those available under the Unisys
      Medical and Dental Plans) for you and your eligible dependents,
      subject, however, to the generally applicable terms of such plans; and

  f)  Subject to Section 13, any benefits available to terminated
      employees under the generally applicable terms of the Unisys
      plans in which you participated as an active employee.

   Any amounts that become payable to you under this Section 8 shall be
   paid notwithstanding the acceptance of other employment by you after
   your date of termination.

   For purposes of this agreement, "cause" shall mean intentional
   dishonesty, gross neglect of your duties, or continued failure to
   adequately perform your duties (provided that Unisys has provided you
   notice identifying the manner in which it reasonably believes that you
   have failed to adequately perform your duties, and you have failed to
   discontinue your inadequate performance within 30 days of receiving such
   notice).  "Good reason" shall mean (i) a reduction in your base pay or
   annual bonus target, as such amounts may be increased from time to time,
   unless such reduction is due to a reduction in compensation generally
   applicable to elected officers; or (ii) the removal of you from your
   positions as Executive Vice President of Unisys and President,
   Information Services Group (or any successor to the Information Services
   Group).  If your employment is terminated for "cause" or you terminate
   your employment without "good reason", you shall not be entitled to the
   benefits described in this agreement.  You may terminate your employment
   under this agreement upon 30 days prior written notice to Unisys, and
   such termination shall not be deemed to be a breach of this agreement
   and you shall not be entitled to receive any further payments under this
   agreement.

9. If you die or your termination of employment is due to your becoming
   "disabled", you shall be entitled to the following:

  a)  Any remaining payments described in Section 6(a) will become
      Immediately payable;

  b)  All restrictions on any outstanding restricted stock grant will
      immediately lapse;

<PAGE>
Mr. Lawrence C. Russell
October 17, 1995
Page 5


  c)  A pro rata portion of your EVC, if any, earned through your last
      day of active employment, determined and paid in the same manner
      and same time as paid to other elected officers;

  d)  A pro rata portion (based on the number of months that you were
      actively employed in the three year award period) of your individual
      long term incentive plan payment, if any, determined and paid at the
      end of the three year award period and in the same manner as if
      you had continued to be actively employed; and

  e)  Any benefits available to disabled former employees under the
      generally applicable terms of the Unisys plans in which you
      participated as an active employee.

   You shall be considered "disabled" if you meet the requirements for a
   long-term disability under the terms of the Unisys Long-Term Disability
   Plan, regardless of whether you participate in such plan.  The
   determination of whether you are disabled shall be made by the claims
   administrator of the Unisys Long-Term Disability Plan in accordance with
   the procedures generally applicable under such plan.  If you become
   disabled, you shall be entitled to the benefits described in this
   Section 9 and not those described in Section 8.

10. From and after the termination of your employment for any reason:

  a)  For one year you shall not engage in or become employed as a
      business owner, employee, agent, representative or consultant
      in any activity which is in competition with any line of business
      of Unisys (or its subsidiaries or affiliates) existing as of your
      termination date and over which you had direct responsibility,
      except with the express prior written consent of the Chief
      Executive Officer of Unisys;

  b)  You shall not negatively comment publicly or privately about
      Unisys (or its subsidiaries or affiliates), any of its products,
      services or other businesses, its present or past Board of Directors,
      its officers, or employees, nor shall you in any way discuss the
      circumstances of your termination of employment, except that you
      may give truthful testimony before a court or governmental agency;

  c)  You shall not induce or attempt to induce any employee of Unisys
      (or any of its subsidiaries or affiliates) to render services for
      any other person, firm or business entity;

  d)  You shall not use, furnish or divulge to any other person, firm or
      business entity any confidential information relating to Unisys
      business (or that of any of its subsidiaries or affiliates), or any
      trade secrets, processes, contracts or arrangements involved in any
      such business, except when required to do so by a

<PAGE>
Mr. Lawrence C. Russell
October 17, 1995
Page 6

      court of law, by any governmental agency having supervisory
      authority over the business of Unisys or by any administrative or
      legislative body (including a committee thereof) with apparent
      jurisdiction to order you to divulge, disclose or make accessible
      such information.

   From and after the termination of your employment for any reason, Unisys
   agrees not to negatively  comment publicly or privately about you or the
   circumstances of your termination of employment.  You and Unisys
   mutually agree that the obligations contained in this Section 10 are
   reasonable and necessary for each party's mutual protection and that one
   party cannot be reasonably or adequately compensated in damages in an
   action at law in the event that the other party breaches such
   obligations.  You and Unisys expressly agree that, in addition to any
   other rights or remedies which each may possess, each shall be entitled
   to injunctive and other equitable relief to prevent a breach of this
   Section 10 by the other party, including a temporary restraining order
   or temporary injunction from any court of competent jurisdiction
   restraining any threatened or actual violation, and you and Unisys each
   consents to the entry of such an order and injunctive relief and waives
   the making of a bond as a condition for obtaining such relief.  Such
   right shall be cumulative in addition to any other legal or equitable
   rights and remedies the parties may have.  In addition, in the event
   that you should materially breach your obligations under Section 10(b)
   or you should breach any other obligation described in this Section 10,
   Unisys shall have the right to terminate any remaining payments due
   under Section 8(d).

11. You agree to move to the Philadelphia area and you will be eligible for
    the benefits provided under the Unisys Moving and Relocation Policy
    including the standard Third Party Home Purchase Assistance Plan for
    your current residence.  In lieu of the payment of the miscellaneous
    relocation expense allowance described in Section 24 of such policy,
    Unisys will grant you one month's salary (grossed up for taxes) to cover
    miscellaneous relocation expenses.

12. You are also eligible to join a country club of your choice and Unisys
    will pay your initiation fee and annual dues.

13. Payments under this agreement are not intended to duplicate payments
    under any other Unisys agreement or severance program, including,
    without limitation, the Executive Employment Agreement applicable to
    Unisys elected officers which covers and takes effect only upon change
    in control situations as defined therein.  To the extent that you may be
    entitled to receive duplicate payments under this and any other Unisys
    agreement or program, the provisions of that agreement or program which
    is most favorable to you or provides you with the greater benefit shall
    be effective.

14. Each of the above-described benefits which are more fully described in
    an applicable Unisys plan document are subject to the terms of  such
    plan document (as may be amended by Unisys from time to time) and,
    except as expressly provided in this agreement, each such plan document
    will govern the benefit payable hereunder and

<PAGE>
Mr. Lawrence C. Russell
October 17, 1995
Page 7



    thereunder.  In addition, you agree that the Unisys policies and
    procedures applicable to all Unisys employees, including, without
    limitation, the Unisys Code of Ethical Conduct, shall be applicable to
    you.

15. This offer is contingent upon your compliance with the Immigration
    Reform Control Act of 1986 (IRCA).  Please review the attached list of
    acceptance verification documents.  During the orientation you will be
    asked to show the appropriate documents, to complete an attestation form
    and to complete an application of employment form.

16. This agreement shall be binding upon Unisys and its successors and
    assigns.

17. Except for the Executive Employment Agreement described in Section 13,
    this agreement constitutes the entire agreement between you and Unisys
    relating to your employment and additional matters provided for herein.
    This agreement supersedes all prior agreements, whether written or oral,
    between you and Unisys relating to your employment and additional
    matters provided for herein.  No provision of this agreement may be
    modified, waived or discharged unless such waiver, modification or
    discharge is agreed to in writing and signed by you and such officer as
    may be specifically designated by Unisys.  The validity, interpretation,
    construction and performance of this agreement shall be governed by the
    laws of the Commonwealth of Pennsylvania without giving effect to the
    provisions thereof relating to conflicts of laws.

18. The invalidity or unenforceability of any provision of this agreement
    shall not affect the validity or enforceability of any other provision
    of this agreement, which shall remain in full force and effect.

19. Any dispute or controversy arising under or in connection with this
    agreement shall be settled exclusively by arbitration in Philadelphia,
    Pennsylvania in accordance with the rules of the American Arbitration
    Association.  Any arbitration award will be final and conclusive upon
    the parties, and a judgment enforcing such award may be entered in any
    court of competent jurisdiction.  Costs of arbitration shall be borne by
    Unisys.  Unless the arbitrator determines that you did not have a
    reasonable basis for asserting your position with respect to the dispute
    in question, Unisys shall also reimburse you for your reasonable
    attorneys' fees incurred with respect to any arbitration.

20. Unisys represents and warrants that it is fully authorized and empowered
    to enter into this agreement.

21. This Agreement shall be null and void if you have not commenced your
    employment with Unisys by November 13, 1995.

<PAGE>
Mr. Lawrence C. Russell
October 17, 1995
Page 8



Larry, we all look forward to your positive response to our offer and to
having someone of your experience and personal attributes with us in the near
future.  It is our expectation that you would start by November 6, and that we
could make the announcement by that time.  If you have any questions, or if we
can be of personal assistance to you in any way, please feel free to call me
at (215) 986-3930.

Sincerely,



David O. Aker
Vice President, Human Resources

Enclosures

cc:   J. A. Unruh



Accepted:  _______________________          Date: _______
           Lawrence C. Russell



<TABLE>
                                                                                         EXHIBIT 11
                                            UNISYS CORPORATION
                             STATEMENT OF COMPUTATION OF EARNINGS PER SHARE
                               FOR THE THREE YEARS ENDED DECEMBER 31, 1995
                                       (Millions, except share data)
<CAPTION>
                                                              1995           1994           1993
- ---------------------------------------------------------------------------------------------------
<S>                                                       <C>            <C>            <C>
Primary Earnings Per Common Share           

Average Number of Outstanding Common Shares               171,238,499    170,752,220    162,735,752
Additional Shares Assuming Exercise of Stock Options          719,308      1,563,156      2,333,930
                                                          -----------    -----------    -----------
Average Number of Outstanding Common Shares and
    Common Share Equivalents                              171,957,807    172,315,376    165,069,682
                                                          ===========    ===========    ===========
Income (Loss) From Continuing Operations Before
    Extraordinary Items and Changes in 
    Accounting Principles                                     $(627.3)        $ 12.1         $286.3
Dividends on Series A, B and C Preferred Stock                 (120.3)        (120.1)        (121.6)
                                                          -----------    -----------    -----------
Primary Earnings (Loss)  on Common Shares 
  Before Discontinued Operations, Extraordinary Items 
    and Changes in Accounting Principles                       (747.6)        (108.0)         164.7
Income From Discontinued Operations                               2.7           96.1           75.3
Extraordinary Items                                                           (  7.7)         (26.4)
Effect of Changes in Accounting Principles                                                    230.2
                                                          -----------    -----------    -----------
Primary Earnings (Loss) on Common Shares                      $(744.9)        $(19.6)        $443.8
                                                          ===========    ===========    ===========

Primary Earnings (Loss) Per Common Share
    Continuing Operations                                      $(4.35)         $(.63)         $1.00
    Discontinued Operations                                       .02            .56            .46
    Extraordinary Items                                                         (.04)          (.16)
    Effect of Changes in Accounting Principles                                                 1.39
                                                          -----------    -----------    -----------
       Total                                                   $(4.33)         $(.11)         $2.69
                                                          ===========    ===========    ===========

Fully Diluted Earnings
 Per Common Share

Average Number of Outstanding Common
    Shares and Common Share Equivalents                   171,957,807    172,315,376    165,069,682
Additional Shares:
    Assuming Conversion of Series A Preferred Stock        47,454,636     47,454,500     47,586,877
    Assuming Conversion of 8 1/4% Convertible Notes        33,697,387     33,698,698     33,699,634
    Attributable to Stock Options                              26,244        111,276        193,741
                                                          -----------    -----------    -----------
Common Shares Outstanding Assuming Full Dilution          253,136,074    253,579,850    246,549,934
                                                          ===========    ===========    ===========

Primary Earnings (Loss) on Common Shares Before 
    Discontinued Operations, Extraordinary 
    Items and Changes In Accounting Principles                $(747.6)       $(108.0)        $164.7
Exclude Dividends on Series A Preferred Stock                   106.5          106.5          106.8
Interest Expense on 8 1/4% Convertible Notes,
    Net of Applicable Tax                                        17.8           17.8           17.8
                                                          -----------    -----------    -----------
Fully Diluted Earnings (Loss) on Common Shares Before 
    Discontinued Operations, Extraordinary
      Items and Changes In Accounting Principles               (623.3)          16.3          289.3
Income From Discontinued Operations                               2.7           96.1           75.3
Extraordinary Items                                                            ( 7.7)         (26.4)
Effect of Changes in Accounting Principles                                                    230.2
                                                          -----------    -----------    -----------
Fully Diluted Earnings (Loss) on Common Shares                $(620.6)        $104.7         $568.4
                                                          ===========    ===========    ===========

Fully Diluted Earnings (Loss) Per Common Share    
    Continuing Operations                                      $(2.46)         $ .06          $1.17
    Discontinued Operations                                       .01            .38            .31
    Extraordinary Items                                                         (.03)          (.11)
    Effect of Changes in Accounting Principles                                                  .94
                                                          -----------    -----------    -----------
    Total                                                      $(2.45)          $.41          $2.31
                                                          ===========    ===========    ===========


Earnings (Loss) Per Common Share As Reported

Primary
    Continuing Operations                                      $(4.37)      $(  .63)          $1.00
    Discontinued Operations                                       .02           .56             .46
    Extraordinary Items                                                      (  .04)           (.16)
    Effect of Changes in Accounting Principles                                                 1.39
                                                          -----------    -----------    -----------
    Total                                                      $(4.35)<F1>   $( .11)<F1>      $2.69
                                                          ===========    ===========    ===========

Fully Diluted
    Continuing Operations                                      $(4.37)      $(  .63)          $1.17
    Discontinued Operations                                       .02           .56             .31
    Extraordinary Items                                                        (.04)          ( .11)
    Effect of Changes in Accounting Principles                                                  .94
                                                          -----------    -----------    -----------
    Total                                                      $(4.35)<F1>   $( .11)<F1>      $2.31
                                                          ===========    ===========    ===========
<FN>
<F1> Based on weighted average number of outstanding common shares since inclusion of common stock equivalents
     or assumed conversion of 8 1/4% notes or Series A Convertible Preferred Stock would have been antidilutive.
</TABLE>




<TABLE>
                                                                                EXHIBIT 12

                                   UNISYS CORPORATION
                    COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
                                     ($ in millions)


                                                      Years Ended December 31
                                           1995      1994      1993      1992        1991
- ------------------------------------------------------------------------------------------
<S>                                     <C>        <C>       <C>       <C>      <C>
Income (loss) from continuing
    operations before income taxes      $(781.1)   $ 14.6    $370.9    $301.3   $(1,425.6)
Add (deduct) share of loss (income)
    of associated companies                 5.0      16.6      14.5       3.2        (6.5)
                                        -------    ------    ------    ------   ---------
        Subtotal                         (776.1)     31.2     385.4     304.5    (1,432.1)
                                        -------    ------    ------    ------   ---------
Interest expense (net of interest
    capitalized)                          202.1     203.7     241.7     340.6       407.6
Amortization of debt issuance
    expenses                                5.1       6.2       6.6       4.8         1.8
Portion of rental expense
    representative of interest             65.3      65.0      70.5      78.8        80.9
                                        -------    ------    ------    ------   ---------
        Total Fixed Charges               272.5     274.9     318.8     424.2       490.3
                                        -------    ------    ------    ------   ---------
Earnings (loss) from continuing
    operations before income taxes
    and fixed charges                   $(503.6)   $306.1    $704.2    $728.7     $(941.8)
                                        =======    ======    ======    ======     =======
Ratio of earnings to fixed charges         <F1>      1.11      2.21      1.72        <F1>
                                        =======    ======    ======    ======     =======
<FN>
<F1>  Earnings for the years ended December 31, 1995 and 1991 were inadequate to cover fixed
      charges by approximately $776.1 million and $1,432.1 million, respectively.
</TABLE>






                     Management's Discussion and Analysis of
                 Financial Condition and Results of Operations
                 ---------------------------------------------

OVERVIEW
- --------
In 1995, the company reported a net loss of $624.6 million, or $4.35 per
primary and fully diluted common share, compared to net income of $100.5
million, or a loss of $.11 per primary and fully diluted common share,
in 1994. Results include fourth quarter charges of $846.6 million pretax
($670.5 million after tax) in 1995 and $186.2 million pretax ($133.1
million after tax) in 1994. See Note 2 of the Notes to Consolidated
Financial Statements.

In October of 1995, the company announced that it would realign
internally into three business units - information services, support
services and computer systems - each with its own marketing and sales
organization. In the fourth quarter of 1995, in connection with this
realignment, the company recorded a restructuring charge of $717.6
million ($581.9 million after tax), or $3.39 per primary and fully
diluted common share. The charge covers (a) $436.6 million for work
force reductions of approximately 7,900 people including severance,
notice pay, medical and other benefits, (b) $218.6 million for
consolidation of office facilities and manufacturing capacity, and (c)
$62.4 million for costs associated with
 product and program
discontinuances. Cash requirements for these charges are expected to
approximate $400 million in 1996 and $150 million in 1997. However,
depending on the timing of implementation, cash savings are expected to
significantly offset the 1996 cash requirements and more than offset the
1997 amount. As a result of the restructuring actions, the company
expects to generate annualized savings in excess of $500 million by the
end of 1996 and $600 million by the end of 1997. In addition, in the
fourth quarter of 1995, the company recorded a charge for contract
losses of $129.0 million ($88.6 million after tax), or $.51 per primary
and fully diluted share, primarily related to a few large multi-year,
fixed-price systems integration contracts. Included in the charge is
$65.5 million, due to developments with respect to contract
terminations.

In 1996, the company may experience a slow first half because of
potential disruption caused by the realignment of its operations into
three business units. The company's priorities in 1996 will be to focus
on the effective and timely implementation of its new three business
unit model and the execution of its restructuring plan. In addition, the
company will focus on operational issues, including planned product
introductions, working capital management and improvement in the
processes for qualification, bidding and execution of long-term, fixed-
price systems integration contracts.

In May of 1995, the company sold its defense business for cash of $862
million. A loss on the sale of $9.8 million, or $.06 per primary and
fully diluted share, was recorded in the fourth quarter of 1995 after
completion of the purchase price adjustment process. The net results of
the defense operations for all periods presented are reported separately
in the Consolidated Statement of Income as "income from discontinued
operations." Prior period financial statements have been restated to
report the defense business as a discontinued operation. See Note 3 of
the Notes to Consolidated Financial Statements.

Results of Operations
- ---------------------
Revenue for 1995 was $6.2 billion, up 4% from 1994 revenue of $6.0
billion. Approximately two-thirds of the overall increase in revenue was
caused by foreign currency changes. Sales revenue declined 8% to $2.6
billion in 1995 from $2.9 billion in 1994, due to decreases in sales of
enterprise systems and servers (21%), offset by increases in sales of
departmental servers and desktop systems (6%) and software (3%).
Services revenue increased 25% to $2.2 billion in 1995 from $1.8 billion
in 1994. Equipment maintenance revenue increased 1% in 1995 to $1.4
billion from $1.3 billion in 1994.

<PAGE>
Revenue for 1994 was $6.0 billion, as an increase in services revenue of
30% offset declines in sales revenue of 9% and equipment maintenance
revenue of 7%.

Revenue from international operations in 1995 was $3.8 billion, up 6%
from 1994, due principally to foreign currency changes. Revenue from
U.S. operations in 1995 was $2.4 billion, up 1% from 1994. Revenue from
operations outside the U.S. in 1994 was $3.6 billion, up 4% from 1993,
due principally to an increase in revenue in Japan. Revenue from U.S.
operations in 1994 was $2.4 billion, down 5% from 1993.

Sales gross profit margin was 39% in 1995 compared to 45% in 1994;
services gross profit margin was 8% in 1995 compared to 22% in 1994; and
equipment maintenance gross profit margin was 29% in 1995 compared to
35% in 1994. Excluding restructuring charges in both years: sales gross
profit margin was 43% in 1995 compared to 47% in 1994; services gross
profit margin was 15% in 1995 compared to 23% in 1994; and equipment
maintenance gross profit margin was 36% in 1995 compared to 40% in 1994.
The decline in sales gross profit margin was due in large part to a
higher proportion of lower-margin personal computer sales and the
reduced volume of large computer systems sales. The decline in services
gross profit margin was principally due to provisions for loss contracts
in 1995. The decline in equipment maintenance gross profit margin was
due in large part to a higher proportion of lower-margin multivendor
maintenance.

Total gross profit margin was 26% in 1995 (32% excluding restructuring
charges) compared to 36% in 1994 (38% excluding restructuring charges).
The total gross profit margin is expected to continue to reflect the
continuing shift to lower-margin products and services as well as
competitive pricing. In addition, business risks associated with services
contracts, particularly large, multi-year, fixed-price systems integration
contracts, may from time to time create volatility in margins.

In 1993, total gross profit margin was 43%, sales gross profit margin
was 51%, services gross profit margin was 25%, and equipment maintenance
gross profit margin was 43%.

Selling, general and administrative expenses in 1995 were $1.9 billion
compared to $1.5 billion in 1994. Exclusive of restructuring charges,
selling, general and administrative expenses in 1995 were $1.6 billion,
an increase of 5% from $1.5 billion in 1994. Approximately one-half of
the increase was due to the effects of foreign currency changes.
Selling, general and administrative expenses were $1.5 billion in 1993.

Research and development expenses in 1995 were $409.5 million compared to
$463.6 million in 1994. Exclusive of restructuring charges, research and
development expenses were $366.8 million in 1995 compared to $435.7 million
in 1994, a decline of 16%. In 1993, research and development expenses were
$489.3 million. Reductions in research and development expenses principally
reflect the company's move to common hardware platforms and technologies.
In addition, research and development expense as a percent of total revenue
is expected to decline consistent with the increasing proportion of revenue
from the services businesses, which require less research and
development expenditures.

In 1995, the company reported an operating loss of $698.1 million
compared to operating income of $154.4 million in 1994 and $572.4
million in 1993. Exclusive of restructuring charges, operating income in
1995 was $19.5 million (.3% of revenue) compared to $339.6 million (5.7%
of revenue) in 1994 and $572.4 million (9.6% of revenue) in 1993.

Interest expense was $202.1 million in 1995, $203.7 million in 1994 and
$241.7 million in 1993. The decline in 1994 from 1993 was due
principally to lower average debt levels.

Other income in 1995 was $119.1 million compared to $63.9 million in
1994 and $40.2 million in 1993. The increase in other income in 1995
compared to 1994 was due principally to higher royalty and interest
income. The increase in other income in 1994 compared to 1993 was due
principally to favorable foreign currency translation.

It is the company's policy to minimize its exposure to foreign currency
fluctuations. Due to a weakening of the U.S. dollar compared to foreign
currencies, foreign currency changes, including the cost of hedging, had
a positive effect on net income in 1995 when compared to last year.

The loss from continuing operations before income taxes for 1995 was
$781.1 million ($63.5 million exclusive of restructuring charges)
compared to income in 1994 of $14.6 million ($200.8 million exclusive of
restructuring charges) and income in 1993 of $370.9 million.

Estimated income taxes in 1995 were a benefit of $153.8 million ($18.1
million benefit before the restructuring charge) compared to a 1994
provision of $2.5 million ($55.6 million before the restructuring charge)
and a 1993 provision of $84.6 million.

The net loss for 1995 was $624.6 million compared to net income of 
$100.5 million in 1994 and $565.4 million in 1993.

Accounting Changes and Extraordinary Items
- ------------------------------------------
In 1995, the Financial Accounting Standards Board ("FASB") issued
Statement of Financial Accounting Standards ("SFAS") No. 121,
"Accounting for the Impairment of Long-Lived Assets and for Long-Lived
Assets to Be Disposed Of," and SFAS 123, "Accounting for Stock-Based
Compensation." Both of these statements are required to be adopted by
January 1, 1996. The company does not expect that adoption of SFAS 121
and 123 will have a material effect on its consolidated financial
position, consolidated statement of income, or liquidity. For further
discussion, see Note 4 of the Notes to Consolidated Financial
Statements.

In 1994, the company recorded an extraordinary charge for repurchases of
debt of $7.7 million, net of $5.1 million of income tax benefits, or
$.04 per fully diluted common share.

Effective January 1, 1993, the company adopted SFAS 106, "Employers'
Accounting for Postretirement Benefits Other Than Pensions," and SFAS
109, "Accounting for Income Taxes." The adoption of SFAS 106 decreased
net income $194.8 million, net of $124.5 million of income tax benefits,
or $.79 per fully diluted common share, and the adoption of SFAS 109
increased net income by $425.0 million, or $1.73 per fully diluted common
share. For further discussion of SFAS 106 and 109, see Notes 15 and 7,
respectively, of the Notes to Consolidated Financial Statements.

At December 31, 1995, the company had deferred tax assets in excess of
deferred tax liabilities of $1,457 million. For the reasons cited below,
management determined that it is more likely than not that $958 million
of such assets will be realized, therefore resulting in a valuation
allowance of $499 million. In assessing the likelihood of realization
of this asset, the company considered various factors including its
forecast of future taxable income and available tax planning strategies
that could be implemented to realize deferred tax assets.

The principal methods used to assess the likelihood of realization were
the company's forecast of future taxable income, which was adjusted by
applying probability factors to the achievement of this forecast, and
tax planning strategies. The combination of forecasted taxable income
and tax planning strategies are expected to be sufficient to realize
the entire amount of net deferred tax assets. Approximately $2.8 billion
of future taxable income (predominantly U.S.) is needed to realize all
of the net deferred tax assets.

The company's net deferred tax assets include substantial amounts of net
operating loss and tax credit carryforwards. Failure to achieve
forecasted taxable income might affect the ultimate realization of the
net deferred tax assets. In recent years, the information management
business has undergone dramatic changes and there can be no assurances
that in the future there would not be increased competition or other
factors that may result in a decline in sales or margins, loss of market
share, or technological obsolescence. The company will evaluate
quarterly the realizability of its net deferred tax assets by assessing
its valuation allowance and by adjusting the amount of such allowance,
if necessary.

In 1993, the company reported an extraordinary charge of $26.4 million,
net of $16.8 million of income tax benefits, or $.11 per fully diluted
common share. See Note 4 of the Notes to Consolidated Financial Statements.

Financial Condition
- -------------------
In 1995, cash provided by operating activities was $97.7 million
compared to $529.1 million in 1994 and $953.4 million in 1993. The
decrease in cash provided in 1995 compared to 1994 was due in large part
to the loss in 1995, restructuring payments relating to prior years, and
an increase in income tax payments.

Investments in properties and rental equipment were $195.0, $208.2, and
$173.5 million in 1995, 1994, and 1993, respectively.

During 1995, 1994, and 1993, the company retired $68.2, $140.1, and $394.4
million of debt, respectively. The company intends, from time to time, to
continue to redeem or repurchase its securities in the open market or in
privately negotiated transactions depending upon availability, market
conditions, and other factors.

At December 31, 1995, total debt was $1.9 billion, a decrease of $55.3
million from December 31, 1994. Cash, cash equivalents, and marketable
securities at December 31, 1995 were $1,119.7 million compared to $884.6
million at December 31, 1994. During 1995, debt net of cash and
marketable securities decreased $290.4 million to $769.2 million. As a
percent of total capital, debt net of cash and marketable securities was
29% at both December 31, 1995 and 1994.

Cash requirements in 1996 are expected to include payments in respect of
the restructuring actions discussed above and current maturities of
long-term debt. See Notes 2 and 9 of the Notes to Consolidated Financial
Statements. The company believes that the funds to meet these
requirements will come from a combination of utilization of cash on
hand, operating cash flow, which will reflect savings generated by the
restructuring actions, and external sources of financing.

The company has on file with the Securities and Exchange Commission an
effective registration statement covering $500 million of debt or equity
securities which enables the company to be prepared for future market
opportunities.

The company has a $325 million revolving credit facility with a syndicate
of banks that expires in May of 1996. In September and December of 1995,
the bank syndicate waived compliance with certain financial covenants in
the facility which were impacted by performance in the respective quarters.
Borrowings under that facility are now subject to approval by the bank
group. The company has never utilized the facility and does not expect
to do so. The size, terms, conditions and participating banks for a new
facility, if any, after expiration of the current facility, have yet to
be determined.

<PAGE>
Dividends paid on preferred stock amounted to $120.2 million in 1995
compared to $228.0 million in 1994 and $183.7 million in 1993. The 1994
amount included full payment for all preferred dividend arrearages.

Net cash provided by discontinued operations in 1995 was $658.3 million
consisting of $862.0 million proceeds from the sale of the defense
business offset by cash used of $203.7 million. Cash provided by
discontinued operations in 1994 and 1993 amounted to $102.2 and $43.0
million, respectively.

The company may settle certain open tax years with the Internal Revenue
Service in 1996. It is expected that such settlements will result in
cash payments of approximately $60 million (including interest). These
payments will not affect earnings since provision for these taxes has
been made in prior years.

Stockholders' equity decreased $744.3 million during 1995, principally
reflecting the net loss of $624.6 million and preferred dividends of
$123.7 million.

<PAGE>
CONSOLIDATED STATEMENT OF INCOME
Unisys Corporation

- ------------------------------------------------------------------------------
Year Ended December 31
(Millions, except per share data)              1995        1994        1993
==============================================================================
Revenue
Sales                                        $2,646.3    $2,877.1    $3,178.6
Services                                      2,198.1     1,759.4     1,358.2
Equipment maintenance                         1,357.9     1,341.7     1,444.0
- ------------------------------------------------------------------------------
                                              6,202.3     5,978.2     5,980.8
- ------------------------------------------------------------------------------
Costs and expenses
Cost of sales                                 1,611.0     1,568.7     1,563.8
Cost of services                              2,030.4     1,374.0     1,018.6
Cost of equipment maintenance                   965.7       872.7       820.4
Selling, general and administrative expenses  1,883.8     1,544.8     1,516.3
Research and development expenses               409.5       463.6       489.3
- ------------------------------------------------------------------------------
                                              6,900.4     5,823.8     5,408.4
- ------------------------------------------------------------------------------
Operating income (loss)                        (698.1)      154.4       572.4
Interest expense                                202.1       203.7       241.7
Other income, net                               119.1        63.9        40.2
- ------------------------------------------------------------------------------
Income (loss) from continuing operations
  before income taxes                          (781.1)       14.6       370.9
Estimated income taxes (benefit)               (153.8)        2.5        84.6
- ------------------------------------------------------------------------------
Income (loss) from continuing operations
  before extraordinary items and changes
  in accounting principles                     (627.3)       12.1       286.3
Income from discontinued operations               2.7        96.1        75.3
Extraordinary items                                          (7.7)      (26.4)
Effect of changes in accounting principles                              230.2
- ------------------------------------------------------------------------------
Net income (loss)                              (624.6)      100.5       565.4
Dividends on preferred shares                   120.3       120.1       121.6
- ------------------------------------------------------------------------------
Earnings (loss) on common shares              $(744.9)     $(19.6)     $443.8
==============================================================================
Earnings (loss) per common share
Primary
Continuing operations                          $(4.37)     $(.63)       $1.00
Discontinued operations                           .02        .56          .46
Extraordinary items                                         (.04)        (.16)
Effect of changes in accounting principles                               1.39
- ------------------------------------------------------------------------------
Total                                          $(4.35)     $(.11)       $2.69
==============================================================================
Fully diluted
Continuing operations                          $(4.37)     $(.63)       $1.17
Discontinued operations                           .02        .56          .31
Extraordinary items                                         (.04)        (.11)
Effect of changes in accounting principles                                .94
- ------------------------------------------------------------------------------
Total                                          $(4.35)     $(.11)       $2.31
==============================================================================

See notes to consolidated financial statements.

<PAGE>
CONSOLIDATED BALANCE SHEET
Unisys Corporation

December 31 (Millions)                        1995          1994
==================================================================
Assets
- ------------------------------------------------------------------
Current assets

Cash and cash equivalents                   $1,114.3     $   868.4
Marketable securities                            5.4          16.2
Accounts and notes receivable, net             996.3         945.1
Inventories                                    673.9         636.3
Deferred income taxes                          329.8         310.5
Other current assets                            98.9          98.3
Net assets of discontinued operations                        526.5
- ------------------------------------------------------------------
Total                                        3,218.6       3,401.3
- ------------------------------------------------------------------
Long-term receivables, net                      58.7          71.5
- ------------------------------------------------------------------
Properties and rental equipment              2,088.4       2,209.9
Less - Accumulated depreciation              1,397.0       1,479.9
- ------------------------------------------------------------------
Properties and rental equipment, net           691.4         730.0
- ------------------------------------------------------------------
Cost in excess of net assets acquired        1,014.6         998.0
- ------------------------------------------------------------------
Investments at equity                          298.9         315.8
- ------------------------------------------------------------------
Deferred income taxes                          682.6         583.2
- ------------------------------------------------------------------
Other assets                                 1,148.4       1,093.6
- ------------------------------------------------------------------
Total                                       $7,113.2      $7,193.4
==================================================================

- ------------------------------------------------------------------
Liabilities and stockholders' equity
- ------------------------------------------------------------------
Current liabilities

Notes payable                               $   12.1      $    8.9

Current maturities of long-term debt           343.5          71.2
Accounts payable                               940.6         917.6
Other accrued liabilities                    1,677.4       1,123.6
Dividends payable                               30.2          26.6
Estimated income taxes                         143.5         237.7
- ------------------------------------------------------------------
Total                                        3,147.3       2,385.6
- ------------------------------------------------------------------
Long-term debt                               1,533.3       1,864.1
- ------------------------------------------------------------------
Other liabilities                              572.4         339.2
- ------------------------------------------------------------------
Stockholders' equity
Preferred stock                              1,570.3       1,570.3
Common stock, shares issued:
  1995 - 172.3; 1994 - 171.8                     1.7           1.7
Retained earnings (accumulated deficit)       (702.6)         45.7
Other capital                                  990.8         986.8
- ------------------------------------------------------------------
Stockholders' equity                         1,860.2       2,604.5
- ------------------------------------------------------------------
Total                                       $7,113.2      $7,193.4
==================================================================

See notes to consolidated financial statements.

<PAGE>
CONSOLIDATED STATEMENT OF CASH FLOWS
Unisys Corporation

- -------------------------------------------------------------------------------
Year Ended December 31 (Millions)                   1995       1994       1993
===============================================================================
Cash flows from operating activities
Income (loss) from continuing operations         $(627.3)     $12.1     $490.1
Add (deduct) items to reconcile income
  (loss) from continuing operations to net cash
  provided by operating activities:
Effects of extraordinary items and changes in
  accounting principles                                        (7.7)    (203.8)
Depreciation                                       203.0      226.2      252.0
Amortization:
  Marketable software                              151.7      150.5      144.6
  Cost in excess of net assets acquired             40.9       36.9       36.7
(Increase) decrease in deferred
  income taxes, net                               (223.1)     (60.6)     223.7
(Increase) decrease in receivables, net            (66.9)     (16.5)     307.8
(Increase) decrease in inventories                 (15.4)     (28.0)      74.9
Increase (decrease) in accounts payable
  and other accrued liabilities                    565.6      186.3     (276.0)
(Decrease) in estimated income taxes               (63.9)     (12.2)    (164.9)
Increase (decrease) in other liabilities           215.5      (36.8)     (37.5)
(Increase) decrease in other assets               (132.7)      57.6       78.6
Other                                               50.3       21.3       27.2
- -------------------------------------------------------------------------------
Net cash provided by operating activities           97.7      529.1      953.4
- -------------------------------------------------------------------------------
Cash flows from investing activities
Proceeds from investments                        3,311.9    1,792.7    1,821.2
Purchases of investments                        (3,329.6)  (1,816.4)  (1,829.4)
Proceeds from marketable securities                 14.4      197.9      146.5
Purchases of marketable securities                            (97.2)    (187.2)
Proceeds from sales of properties                   30.3       24.8       26.5
Investment in marketable software                 (123.0)    (121.3)    (118.7)
Capital additions of properties and
  rental equipment                                (195.0)    (208.2)    (173.5)
Purchases of businesses                            (42.3)
- -------------------------------------------------------------------------------
Net cash used for investing activities            (333.3)    (227.7)    (314.6)
- -------------------------------------------------------------------------------
Cash flows from financing activities
Principal payments of debt                         (68.2)    (140.1)    (394.4)
Net proceeds from (reduction in)
  short-term borrowings                              3.1        2.9      (47.2)
Dividends paid on preferred shares                (120.2)    (228.0)    (183.7)
Other                                                2.8        3.7        7.1
- -------------------------------------------------------------------------------
Net cash used for financing activities            (182.5)    (361.5)    (618.2)
- -------------------------------------------------------------------------------
Effect of exchange rate changes on cash
  and cash equivalents                               5.7       (9.1)     (37.3)
- -------------------------------------------------------------------------------
Net cash used for continuing operations           (412.4)     (69.2)     (16.7)
- -------------------------------------------------------------------------------
Discontinued operations
Proceeds from sale                                 862.0
Other                                             (203.7)     102.2       43.0
- -------------------------------------------------------------------------------
Net cash provided by discontinued operations       658.3      102.2       43.0
- -------------------------------------------------------------------------------
Increase in cash and cash equivalents              245.9       33.0       26.3
- -------------------------------------------------------------------------------
Cash and cash equivalents, beginning of year       868.4      835.4      809.1
- -------------------------------------------------------------------------------
Cash and cash equivalents, end of year          $1,114.3     $868.4     $835.4
===============================================================================

See notes to consolidated financial statements.

<PAGE>
                    Notes to Consolidated Financial Statements
                                Unisys Corporation
                    ------------------------------------------

NOTE 1  Summary of significant accounting policies
- --------------------------------------------------

Principles of consolidation
- ---------------------------
The consolidated financial statements include the accounts of all wholly
owned subsidiaries. Investments in companies representing ownership
interests of 20% to 50% are accounted for by the equity method.

Use of estimates
- ----------------
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the amounts reported in the financial statements
and accompanying notes. Actual results could differ from those
estimates.

Cash equivalents
- ----------------
All short-term investments purchased with a maturity of three months or
less are classified as cash equivalents.

Inventories
- -----------
Inventories are valued at the lower of cost or market. Cost is
determined principally on the first-in, first-out method.

Properties, rental equipment and depreciation
- ---------------------------------------------
Properties and rental equipment are carried at cost and are depreciated
over the estimated lives of such assets using the straight-line method.
Leasehold improvements are amortized over the shorter of the asset lives
or the terms of the respective leases. The principal rates used are
summarized below by classification of properties:

- -------------------------------------------
                          Rate per Year (%)
===========================================
Buildings                             2 - 5
Machinery and equipment                5-25
Tools and test equipment        10 - 33 1/3
Rental equipment                         25
===========================================

Revenue recognition
- -------------------
Sales revenue is generally recorded upon shipment of product in the case
of sales contracts, upon shipment of the program in the case of
software, and upon installation in the case of sales-type leases.
Revenue from services and equipment maintenance is recorded as earned
over the lives of the respective contracts.

Revenue under cost-type contracts is recognized when costs are incurred,
and under systems integration and services contracts when services have
been performed and accepted or milestones have been met. Cost of revenue
under such contracts is charged based on current estimated total costs.

Accounting for large multi-year, fixed-price systems integration
contracts involves considerable use of estimates in determining revenue,
costs and profits. When estimates indicate a loss under a contract, cost
of revenue is charged with a provision for such loss. Revisions in
profit estimates are reflected in the period in which the facts which
require the revision become known.

Income taxes
- ------------
Income taxes are provided on taxable income at the statutory rates
applicable to such income. Deferred taxes have not been provided on the
cumulative undistributed earnings of foreign subsidiaries since such
amounts are expected to be reinvested indefinitely.

Earnings per common share
- -------------------------
In 1995 and 1994, the computation of both primary and fully diluted
earnings per share was based on the weighted average number of
outstanding common shares. The inclusion of additional shares assuming
the exercise of stock options, conversion of Series A Cumulative
Convertible Preferred Stock, or conversion of the 8 1/4% convertible
subordinated notes due August 1, 2000 would have been antidilutive. In
1993, the computation of primary earnings per share was based on the
weighted average number of outstanding common shares and additional
shares assuming the exercise of stock options, and the computation of
fully diluted earnings per share assumed the conversion of the 8 1/4%
convertible subordinated notes due August 1, 2000. The computation of
fully diluted earnings per share for 1993 further assumed conversion of
Series A Cumulative Convertible Preferred Stock. The shares used in the
computations for the three years ended December 31, 1995 were as follows
(in thousands):

- ------------------------------------------------------
                          1995        1994        1993
======================================================
Primary                171,238     170,752     165,070
Fully diluted          171,238     170,752     246,550
======================================================

Software capitalization
- -----------------------
The cost of development of computer software to be sold or leased is
capitalized and amortized to cost of sales over the estimated revenue-
producing lives of the products, but not in excess of three years
following product release. Unamortized marketable software costs (which
are included in other assets) at December 31, 1995 and 1994 were $238.9
and $265.3 million, respectively.


Cost in excess of net assets acquired
- -------------------------------------
Cost in excess of net assets acquired principally represents the excess
of cost over fair value of the net assets of Sperry Corporation and
Convergent, Inc., which is being amortized on the straight-line method
over 40 years and 12 years, respectively. Accumulated amortization at
December 31, 1995 and 1994 was $571.6 and $530.7 million, respectively.

The carrying value of cost in excess of net assets acquired is reviewed
for impairment whenever events or changes in circumstances indicate that
it may not be recoverable. If such an event occurred, the company would
prepare projections of future results of operations for the remaining
amortization period. If such projections indicated that the cost in
excess of net assets acquired would not be recoverable, the company's
carrying value of such asset would be reduced by the estimated excess of
such value over projected income.

Translation of foreign currency
- -------------------------------
The local currency is the functional currency for most of the company's
international subsidiaries and, as such, assets and liabilities are
translated into U.S. dollars at year-end exchange rates. Income and
expense items are translated at average exchange rates during the year.
Translation adjustments resulting from changes in exchange rates are
reported in a separate component of stockholders' equity. Exchange gains
and losses on certain forward exchange contracts designated as hedges of
international net investments and exchange gains and losses on
intercompany balances of a long-term investment nature are also reported
in the separate component of stockholders' equity.

For those international subsidiaries operating in hyperinflationary
economies, the U.S. dollar is the functional currency and, as such,
non-monetary assets and liabilities are translated at historical exchange
rates and monetary assets and liabilities are translated at current exchange
rates. Exchange gains and losses arising from translation are included in
other income. 

The company also enters into forward exchange contracts and
options that have been designated as hedges of certain transactional
exposures. Gains and losses on these instruments are deferred and are
recognized in income together with the transaction being hedged.


NOTE 2  Significant 1995 and 1994 fourth quarter events
- -------------------------------------------------------

1995 restructuring charge
- -------------------------
In the fourth quarter of 1995, the company recorded a pretax charge of
$717.6 million, $581.9 million after tax, or $3.39 per fully diluted
common share. The charge included (a) $436.6 million for work force
reductions of approximately 7,900 people including severance, notice
pay, medical and other benefits, (b) $218.6 million for consolidation of
office facilities and manufacturing capacity, and (c) $62.4 million
associated with product and program discontinuances.

Cash expenditures related to the restructuring in 1996 and 1997 will
approximate $400.0 million and $150.0 million, respectively. Personnel
reductions in the U.S. will account for approximately 61% of the work
force related accrual and such actions in Europe will represent 32% with
the balance of 7% in Americas/Pacific business units. Actual costs
incurred are charged to the accrued liability when the actions are
taken.

1995 fourth quarter events
- --------------------------
In the fourth quarter of 1995, the company recorded a charge (in cost of
services) for contract losses of $129.0 million ($88.6 million after
tax), or $.51 per primary and fully diluted share, primarily related to
a few large multi-year, fixed-price systems integration contracts.
Included in the charge is $65.5 million, due to developments with
respect to contract terminations.

1994 restructuring charge
- -------------------------
In the fourth quarter of 1994, the company recorded a pretax charge of
$186.2 million, $133.1 million after tax, or $.78 per fully diluted
common share. The charge was related to involuntary employee termination
benefits including severance, notice pay, medical and other benefits for
approximately 4,600 people and was taken to reduce the company's cost
structure.

Cash expenditures in 1994 and 1995 relating to this restructuring charge
were $6.3 million for 825 terminations and $133.0 million for 3,565
terminations, respectively. Approximately $36.0 million is expected to
be expended in 1996 for salary continuation payments and to terminate
approximately 160 people.

Summary
- -------
The 1995 charges for restructuring and loss contracts and the 1994
restructuring charge were recorded in the following statement of income
classifications:

- ---------------------------------------------------------------
Year ended December 31 (Millions)                1995      1994
===============================================================
Cost of sales                                 $ 111.5    $ 30.3
Cost of services                                294.4      17.5
Cost of equipment maintenance                    92.8      61.8
Selling, general and administrative expenses    305.2      47.7
Research and development expenses                42.7      27.9
Other income, net                                           1.0
- ---------------------------------------------------------------
Total                                         $ 846.6   $ 186.2
===============================================================


NOTE 3  Discontinued operations
- -------------------------------

During the year ended December 31, 1995, the company sold its defense
business for cash of $862 million. The net results of the defense
operations for all periods presented are reported separately in the
Consolidated Statement of Income as "income from discontinued
operations." Prior period financial statements have been restated to
report the defense business as a discontinued operation.

The following is a summary of the results of operations of the company's
defense business:

- -----------------------------------------------------------------------
Year ended December 31 (Millions)      1995          1994         1993
=======================================================================
Revenue                             $ 258.1*    $ 1,421.5    $ 1,761.7
- -----------------------------------------------------------------------
Income from operations (net
  of taxes: 1995, $6.5; 1994,
  $42.5; 1993, $57.2)                $ 12.5*       $ 96.1       $ 75.3
Loss on sale, 
  net of taxes of $98.2                (9.8)
- -----------------------------------------------------------------------
Income from discontinued
 operations                           $ 2.7        $ 96.1       $ 75.3
=======================================================================
*Reflects results for the period January 1 through March 31, 1995.


The net assets of discontinued operations were as follows:

- ------------------------------------------------
December 31 (Millions)                     1994
================================================
Current assets                          $ 266.7
Current liabilities                      (123.8)
Property, plant and equipment, net        203.7
Cost in excess of net assets acquired     144.5
Other, net                                 35.4
- ------------------------------------------------
Total                                   $ 526.5
================================================


NOTE 4  Accounting changes and extraordinary items
- --------------------------------------------------

In October 1995, the Financial Accounting Standards Board ("FASB")
issued Statement of Financial Accounting Standards ("SFAS") 123,
"Accounting for Stock-Based Compensation." SFAS 123, which is required
to be adopted by January 1, 1996, establishes financial accounting and
reporting standards for stock-based employee compensation plans, and
establishes accounting standards for issuance of equity instruments to
acquire goods and services from non-employees.

In March 1995, the FASB issued SFAS 121, "Accounting for the Impairment
of Long-Lived Assets and for Long-Lived Assets to Be Disposed Of." SFAS
121, which is required to be adopted by January 1, 1996, establishes
accounting standards for the impairment of long-lived assets, certain
intangible assets and cost in excess of net assets related to those
assets to be held and used and for long-lived assets and certain
identifiable intangibles to be disposed of.

The company does not expect that adoption of SFAS 121 and 123 will have
a material effect on its consolidated financial position, consolidated
statement of income, or liquidity.

In 1994, the company recorded an extraordinary charge for the
repurchases of debt of $7.7 million, net of $5.1 million of income tax
benefits, or $.04 per fully diluted common share.

Effective January 1, 1993, the company adopted SFAS 106, "Employers'
Accounting for Postretirement Benefits Other Than Pensions," and SFAS
109, "Accounting for Income Taxes." The adoption of SFAS 106 decreased
net income $194.8 million, net of $124.5 million of income tax benefits,
or $.79 per fully diluted common share, and the adoption of SFAS 109
increased net income by $425.0 million, or $1.73 per fully diluted 
common share. For further discussion of SFAS 106 and 109, see notes 15 
and 7, respectively.

In 1993, the company settled certain lawsuits in connection with its
sale of the Sperry Aerospace Group in December 1986 to Honeywell, Inc.
The Aerospace Group was part of Sperry Corporation, which was acquired
by the company in September 1986 in the largest acquisition at the time
in the computer industry. The lawsuits alleged violations of securities
laws and fraudulent and negligent misrepresentations of interim
financial statements of the Sperry Aerospace Group as of and for the six
months ended September 30, 1986 prepared in connection with the sale.
The sale of the Aerospace Group as a non-strategic business was part of
the financing strategy for the acquisition of Sperry Corporation and was
carried out very shortly after the completion of this acquisition. The
Aerospace Group operations were never reported in the financial results
of the company. The settlement of litigation arising out of the sale,
therefore, was unrelated to the ordinary activities of the company.
Accordingly, the company reported this litigation settlement as an
extraordinary charge of $26.4 million, net of $16.8 million of income
tax benefits, or $.11 per fully diluted common share.


NOTE 5  Current and long-term receivables, net
- ----------------------------------------------

Current and long-term receivables, net comprise the following:

- ------------------------------------------------------------
December 31 (Millions)                     1995         1994
============================================================
Accounts receivable, net                $ 975.1      $ 907.1
Sales-type leases, net                     50.7         83.9
Installment accounts, net                  29.2         25.6
- ------------------------------------------------------------
Total, net                              1,055.0      1,016.6
Less - Current receivables, net           996.3        945.1
- ------------------------------------------------------------
Long-term receivables, net               $ 58.7       $ 71.5
============================================================

At December 31, 1995 and 1994, the company had sold accounts receivable
of $393.0 and $359.0 million, respectively. Recourse amounts associated
with these sales are expected to be minimal. Adequate reserves are in
place to cover potential losses. On an ongoing basis, the company sells
accounts receivable to Unisys Receivables, Inc., a wholly owned
subsidiary, which then sells such receivables to a master trust. Amounts
sold under this arrangement, which are included in the above accounts
receivable sold, were $152.5 and $125.0 million at December 31, 1995 and
1994, respectively.


NOTE 6  Inventories
- -------------------

Inventories comprise the following:

- ------------------------------------------------------------
December 31 (Millions)                     1995         1994
============================================================
Finished equipment and supplies         $ 358.6      $ 355.0
Work in process and raw materials         315.3        281.3
- ------------------------------------------------------------
Total inventories                       $ 673.9      $ 636.3
============================================================

At December 31, 1995 and 1994, inventories included $120.0
and $94.2 million, respectively, of costs related to long-term
contracts.


NOTE 7  Estimated income taxes
- ------------------------------

- ---------------------------------------------------------------------
Year ended December 31 (Millions)          1995       1994       1993
=====================================================================
Income (loss) from continuing
 operations before income taxes
    United States                      $ (482.7)   $ (75.2)   $ 265.8
    Foreign                              (298.4)      89.8      105.1
- ---------------------------------------------------------------------
Total income (loss) from continuing
  operations before income taxes       $ (781.1)    $ 14.6    $ 370.9
=====================================================================
Estimated income taxes (benefit)
    Current
       United States                    $ (83.6)    $ (6.0)   $ (40.4)
       Foreign                             60.5       87.7      (55.2)
       State and local                     (5.7)     (18.6)     (17.8)
- ----------------------------------------------------------------------
       Total                              (28.8)      63.1     (113.4)
- ----------------------------------------------------------------------
    Deferred
       United States                     (140.4)     (32.8)     127.8
       Foreign                             15.4      (27.8)      57.2
       State and local                                           13.0
- ----------------------------------------------------------------------
       Total                             (125.0)     (60.6)     198.0
- ----------------------------------------------------------------------
Total estimated income
 taxes (benefit)                       $ (153.8)     $ 2.5     $ 84.6
======================================================================

Reconciliation of estimated income taxes at United States statutory tax
rate to estimated income taxes as reported follows:

- ---------------------------------------------------------------------
Year ended December 31 (Millions)           1995      1994      1993
=====================================================================
United States statutory income
 tax (benefit)                          $ (273.4)    $ 5.1   $ 129.8
Difference in estimated income
 taxes on foreign earnings, losses
 and remittances                           192.8      30.3     (17.2)
State taxes                                 (3.6)    (12.1)     (3.1)
Tax refund claims, audit issues,
 and other matters                         (85.4)    (32.8)    (10.3)
Amortization of cost in excess
 of net assets acquired                     12.6      12.6      12.6
Change in tax rates                                            (19.4)
Other                                        3.2       (.6)     (7.8)
- ---------------------------------------------------------------------
Estimated income taxes (benefit)        $ (153.8)    $ 2.5    $ 84.6
=====================================================================

The company adopted SFAS 109 effective January 1, 1993. Under the
provisions of SFAS 109, deferred tax assets and liabilities are
recognized using enacted tax rates and reflect the effect of "temporary
differences" between the recorded amounts of assets and liabilities for
financial reporting purposes and the tax basis of such assets and
liabilities.

The tax effects of temporary differences and carryforwards that give
rise to significant portions of deferred tax assets and liabilities at
December 31, 1995 and 1994 were as follows:

- --------------------------------------------------------------
December 31 (Millions)                    1995           1994
==============================================================
Deferred tax assets:
Tax loss carryforwards                 $ 532.8        $ 470.7
Foreign tax credit carryforwards         316.8          287.4
Other tax credit carryforwards            77.8           81.2
Capitalized research and
  development                            114.2          134.6
Depreciation                              60.7          113.7
Postretirement benefits                   85.3          101.6
Employee benefits                         81.6           81.4
Restructuring                            286.1           82.3
Other                                    331.0          255.2
- --------------------------------------------------------------
                                       1,886.3        1,608.1
Valuation allowance                     (498.5)        (326.8)
- --------------------------------------------------------------
Total deferred tax assets            $ 1,387.8      $ 1,281.3
==============================================================
Deferred tax liabilities:
Pensions                               $ 317.5        $ 284.1
Other                                    112.1          163.9
- --------------------------------------------------------------
Total deferred tax liabilities         $ 429.6        $ 448.0
==============================================================

SFAS 109 requires that deferred tax assets be reduced by a valuation
allowance if it is more likely than not that some portion or all of the
deferred tax asset will not be realized. During 1995, the net increase
in the valuation allowance was $171.7 million.

Cumulative undistributed earnings of foreign subsidiaries, for which no
U.S. income or foreign withholding taxes have been recorded,
approximated $660 million at December 31, 1995. Such earnings are
expected to be reinvested indefinitely. Determination of the amount of
unrecognized deferred tax liability with respect to such earnings is not
practicable. The additional taxes payable on the earnings of foreign
subsidiaries, if remitted, would be substantially offset by U.S. tax
credits for foreign taxes already paid. While there are no specific
plans to distribute the undistributed earnings in the immediate future,
where economically appropriate to do so, such earnings may be remitted.

Cash paid during 1995, 1994, and 1993 for income taxes was $132.2,
$87.6, and $118.1 million, respectively.

At December 31, 1995, the company has U.S. federal and state and local
tax loss carryforwards and foreign tax loss carryforwards for certain
foreign subsidiaries, the tax effect of which is approximately $532.8
million. These carryforwards will expire as follows (in millions): 1996,
$10.6; 1997, $12.2; 1998, $9.3; 1999, $16.5; 2000, $16.0; and $468.2
thereafter. The company also has available tax credit carryforwards of
approximately $394.6 million, which will expire as follows (in
millions): 1996, $2.6; 1997, $2.1; 1998, $114.6; 1999, $132.0; 2000,
$96.1; and $47.2 thereafter.

The company's net deferred tax assets include substantial amounts of net
operating loss and tax credit carryforwards. Failure to achieve
forecasted taxable income might affect the ultimate realization of the
net deferred tax assets. In recent years, the information management
business has undergone dramatic changes and there can be no assurance
that in the future there would not be increased competition or other
factors which may result in a decline in sales or margins, loss of
market share, or technological obsolescence.

In 1995, the Internal Revenue Service completed its audit of Sperry
Corporation for the years ended March 31, 1985 and 1986 and for the
short period ended September 16, 1986. The company is currently
contesting issues in connection with Sperry Corporation for the years
ended March 31, 1978 through September 16, 1986. The audit of
Convergent, Inc. is currently in the process of being finalized for the
years 1985-1988. In management's opinion, adequate provisions for income
taxes have been made for all years.


NOTE 8  Properties and rental equipment
- ---------------------------------------

Properties and rental equipment comprise the following:

- -------------------------------------------------------
December 31 (Millions)                1995         1994
=======================================================
Land                                $ 26.8       $ 27.2
Buildings                            239.8        248.7
Machinery and equipment            1,312.6      1,313.2
Tools and test equipment             159.8        204.3
Unamortized leasehold
  improvements                        52.7         48.8
Construction in progress              29.9         28.6
Rental equipment                     266.8        339.1
- -------------------------------------------------------
Total properties and rental
  equipment                      $ 2,088.4    $ 2,209.9
=======================================================


NOTE 9  Long-term debt
- ----------------------

Long-term debt comprises:

- -----------------------------------------------------------
December 31 (Millions)                     1995        1994
- -----------------------------------------------------------
10 5/8% senior notes due 1999           $ 330.1     $ 330.1
8 1/4% convertible subordinated
  notes due 2000                          345.0       345.0
9 3/4% senior notes due 1996              238.1       238.1
Credit sensitive notes due 1997           291.8       291.8
9 3/4% senior sinking fund
  debentures due 2016                     190.0       190.0
9 1/2% notes due 1998                     197.5       197.5
8 7/8% notes due 1997                     135.0       135.0
Japanese yen, 5.52% due 1996              100.3       100.3
11 3/8% subordinated notes                             50.0
6 3/4% bonds                                           17.1
Other                                      49.0        40.4
- -----------------------------------------------------------
Total                                   1,876.8     1,935.3
Less - Current maturities                 343.5        71.2
- -----------------------------------------------------------
Total long-term debt                  $ 1,533.3   $ 1,864.1
===========================================================

Total long-term debt maturities in 1996, 1997, 1998, 1999,
and 2000 are $343.5, $431.8, $211.0, $343.7, and $360.7 million,
respectively.

Cash paid during 1995, 1994 and 1993 for interest was $201.3, $208.9,
and $256.7, million, respectively.

The company has a $325 million revolving credit agreement with a
syndicate of banks that expires on May 31, 1996. This agreement provides
for short-term borrowings and up to $100 million of letters of credit.
The terms of the agreement include a minimum net worth requirement, an
interest coverage ratio, and a limitation on the payment of dividends,
payment of debt and amount of outstanding debt. In September and
December of 1995, the bank syndicate waived compliance with those
covenants that were impacted by results of operations in the respective
quarters. Borrowings under the facility are now subject to approval by
the bank group. The company has never utilized the facility and does not
expect to do so.

The company pays commitment fees on the unused amount of the revolving
credit agreement; there are no compensating balance requirements.
Revolving credit borrowings, at the company's option, are at the agent
bank's base rate or the London Interbank Offered Rate, plus a margin
depending on the company's debt rating on its outstanding senior
unsecured long-term debt securities. Commissions for letters of credit
also vary depending on such debt rating. In addition, international
subsidiaries maintain short-term credit arrangements with banks in
accordance with local customary practice.


NOTE 10  Other accrued liabilities
- ----------------------------------

Other accrued liabilities comprise the following:

- ---------------------------------------------------------
December 31 (Millions)                   1995        1994
=========================================================
Payrolls and commissions              $ 328.4     $ 287.5
Customers' deposit and prepayments      507.3       430.2
Taxes other than income taxes           172.4       157.5
Restructuring*                          503.7       209.3
Other                                   165.6        39.1
- ---------------------------------------------------------
Total other accrued liabilities     $ 1,677.4   $ 1,123.6
=========================================================
*At December 31, 1995, an additional $230.6 million was reported in
 other liabilities on the consolidated balance sheet.


NOTE 11  Leases
- ---------------
Rental expense, less income from subleases, for 1995, 1994, and 1993 was
$195.8, $195.1, and $211.8 million, respectively.

Minimum net rental commitments under noncancelable operating leases
outstanding at December 31, 1995, substantially all of which relate to
real properties, were as follows: 1996, $170.2 million; 1997, $140.6
million; 1998, $116.1 million; 1999, $89.9 million; 2000, $71.8 million;
and thereafter, $457.2 million. Such rental commitments have been
reduced by minimum sublease rentals of $114.5 million due in the future
under noncancelable subleases.


NOTE 12  Litigation
- -------------------
There are various lawsuits, claims, and proceedings that have been
brought or asserted against the company. Although the ultimate results
of these lawsuits, claims, and proceedings are not presently
determinable, management does not expect that these matters will have a
material adverse effect on the company's consolidated financial
position, consolidated statement of income, or liquidity.


NOTE 13  Financial instruments
- ------------------------------
The company uses derivative financial instruments to reduce its exposure
to market risks from changes in foreign exchange rates and interest
rates. The company does not hold or issue financial instruments for
speculative trading purposes. The derivative instruments used are
foreign exchange forward contracts and options, and interest rate and
foreign currency swap agreements. These derivatives, which are over-the-
counter instruments, are non-leveraged and involve little complexity.

The company monitors and controls its risks in the derivative
transactions referred to above by periodically assessing the cost of
replacing, at market rates, those contracts in the event of default by
the counterparty. The company believes such risk to be remote. In
addition, before entering into derivative contracts, and periodically
during the life of the contract, the company reviews the counterparties'
financial condition.

Due to its foreign operations, the company is exposed to the effects of
foreign exchange rate fluctuations on the U.S. dollar. Foreign exchange
forward contracts and options generally having maturities of less than
nine months are entered into for the sole purpose of hedging long-term
investments in foreign subsidiaries and certain transactional exposures.

The cost of foreign currency options is recorded in prepaid expenses in
the consolidated balance sheet. At December 31, 1995, such prepaid
expense was $6.1 million. When the U.S. dollar strengthens against
foreign currencies, the decline in value of the underlying exposures is
partially offset by gains in the value of purchased currency options
designated as hedges. When the U.S. dollar weakens, the increase in the
value of the underlying exposures is reduced only by the premium paid to
purchase the options. The cost of options and any gains thereon are
reported in income when the related transactions being hedged (generally
within twelve months) are recognized.

The company also enters into foreign exchange forward contracts. Gains
and losses on such contracts, which hedge transactional exposures, are
deferred and included in current liabilities until the corresponding
transaction is recognized. At December 31, 1995, the company had a total
of $370.9 million (of notional value) of foreign exchange forward
contracts, $176.1 million to sell foreign currencies and $194.8 million
to buy foreign currencies. At December 31, 1994, the company had a total
of $1,483.7 million of such contracts, $811.2 million to sell foreign
currencies and $672.5 million to buy foreign currencies. At December 31,
1995, a realized net gain of approximately $24.7 million was deferred
and included in current liabilities on such contracts. Gains or losses
on foreign exchange forward contracts that hedge foreign currency
transactions are reported in income when the related transactions being
hedged (generally within twelve months) are recognized. Gains or losses
on those contracts that hedge long-term investments in foreign
subsidiaries are reported in a separate component of stockholders'
equity for translation adjustments.

The company uses interest rate swap agreements to effectively convert
variable rate obligations to a fixed-rate basis, and uses foreign
currency swaps to effectively convert foreign currency denominated debt
to U.S. dollar denominated debt in order to reduce the impact of
interest rate and foreign currency rate changes on future income. The
differential to be paid or received under these agreements is recognized
as an adjustment to interest expense related to the debt. The related
amount payable to or receivable from counterparties is included in
current liabilities or current receivables. At December 31, 1995, the
weighted average fixed rate paid by the company was 8.9%. The fair
values of the swap agreements are not recognized in the financial
statements. At December 31, 1995, the company had one interest rate swap
contract with a total notional value of $50.2 million which expires in
1996, and one foreign currency swap for $50.1 million expiring in 1996.
During the three years ended December 31, 1995, there were no
terminations of swap contracts. Accordingly, there were no deferred
gains or losses related to such swaps as of December 31, 1995.

Financial instruments comprise the following:

- ----------------------------------------------------------------
December 31 (millions)                        1995         1994
================================================================
Outstanding:
  Long-term debt                         $ 1,876.8    $ 1,935.3
  Foreign exchange forward contracts*        370.9      1,483.7
  Foreign exchange options*                  256.8        373.9
  Interest rate swaps*                        50.2         63.8
  Foreign currency swaps*                     50.1         50.1
- ----------------------------------------------------------------
Estimated fair value:
  Long-term debt                           1,715.8      1,935.6
  Foreign exchange forward contracts         369.3      1,484.1
  Foreign exchange options                     3.8          4.8
  Interest rate swaps                         (1.0)         (.9)
  Foreign currency swaps                      18.6         22.1
================================================================
*notional value

Financial instruments also include temporary cash investments and
customer accounts receivable. Temporary investments are placed with
creditworthy financial institutions, primarily in over-securitized
treasury repurchase agreements, Euro-time deposits or commercial paper
of major corporations. The company's cash equivalents are classified as
available-for-sale and at December 31, 1995 principally have maturities
of less than one month. Due to the short maturities of these
instruments, they are carried on the balance sheet at cost plus accrued
interest, which approximates market value. Realized gains or losses
during 1995, as well as unrealized gains or losses at December 31, 1995,
were immaterial. Receivables are due from a large number of customers
which are dispersed worldwide across many industries. At December 31,
1995 and 1994, the company had no significant concentrations of credit
risk.

For foreign currency contracts and options, no impact on financial
position or results of operations would result from a change in the
level of the underlying rate, price or index. All of the company's
foreign currency contracts and options are hedges against specific
exposures and have been accounted for as such. Therefore, a change in
the derivative's value would be offset with an equal but opposite change
in the hedged item.

The carrying amount of cash, cash equivalents, and marketable securities
approximates fair value because of the short maturity of these
instruments. The fair value of the company's long-term debt was based on
the quoted market prices for publicly traded issues. For debt that is
not publicly traded, the fair value was estimated based on current
yields to maturity for the company's publicly traded debt with similar
maturities. In estimating the fair value of its derivative positions,
the company utilizes quoted market prices, if available, or quotes
obtained from outside sources.


NOTE 14  Business segment information
- -------------------------------------

The company operates primarily in one business segment - information
management. This segment represents more than 90% of consolidated
revenue, operating profit and identifiable assets. The company's
principal products and services include enterprise systems and servers,
departmental servers and desktop systems, software, information services
and systems integration, and equipment maintenance. These products and
services are marketed throughout the world to commercial businesses and
governments. The company's worldwide operations are structured to
achieve consolidated objectives. As a result, significant
interdependencies and overlaps exist among the company's operating
units. Accordingly, the revenue, operating profit and identifiable
assets shown for each geographic area may not be indicative of the
amounts which would have been reported if the operating units were
independent of one another.

Sales and transfers between geographic areas are generally priced to
recover cost plus an appropriate mark-up for profit. Operating profit is
revenue less related costs and direct and allocated operating expenses,
excluding interest and the unallocated portion of corporate expenses.
Corporate assets are those assets maintained for general purposes,
principally cash and cash equivalents, marketable securities, costs in
excess of net assets acquired, prepaid pension assets, deferred taxes,
investments at equity, net assets of discontinued operations and
corporate facilities.

No single customer accounts for more than 10% of revenue. Revenue from
various agencies of the U.S. Government approximated $530, $476, and
$797 million in 1995, 1994, and 1993, respectively.

A summary of the company's operations by geographic area
is presented below:

- ---------------------------------------------------------------------
(Millions)                         1995          1994          1993
=====================================================================
United States
  Customer revenue             $  2,405.5    $  2,389.1    $  2,513.7
  Affiliate revenue                 721.6         695.6         944.1
- ---------------------------------------------------------------------
  Total                         $ 3,127.1     $ 3,084.7    $  3,457.8
- ---------------------------------------------------------------------
  Operating profit (loss)        $ (306.9)       $ 33.3     $   352.2
  Identifiable assets             1,368.5       1,247.8       1,378.6
- ---------------------------------------------------------------------
Europe and Africa
  Customer revenue              $ 2,090.3    $  1,935.4    $  1,921.2
  Affiliate revenue                  28.8          47.2         107.5
- ---------------------------------------------------------------------
  Total                         $ 2,119.1    $  1,982.6     $ 2,028.7
- ---------------------------------------------------------------------
  Operating (loss)               $ (505.0)      $ (82.5)    $  (165.0)
  Identifiable assets               827.8         758.2         702.4
- ---------------------------------------------------------------------
Americas/Pacific
  Customer revenue              $ 1,706.5     $ 1,653.7     $ 1,545.9
  Affiliate revenue                 138.7         177.7         167.9
- ---------------------------------------------------------------------
  Total                         $ 1,845.2     $ 1,831.4     $ 1,713.8
- ---------------------------------------------------------------------
  Operating profit                $ 408.0       $ 392.6       $ 465.9
  Identifiable assets               496.1         628.1         578.9
- ---------------------------------------------------------------------
Adjustments and eliminations
  Affiliate revenue              $ (889.1)     $ (920.5)   $ (1,219.5)
  Operating profit                   21.5          18.4          17.1
  Identifiable assets               (23.9)        (50.7)        (66.6)
- ---------------------------------------------------------------------
Consolidated
  Revenue                       $ 6,202.3     $ 5,978.2     $ 5,980.8
- ---------------------------------------------------------------------
  Operating profit (loss)        $ (382.4)      $ 361.8       $ 670.2
  General corporate expenses       (196.6)       (143.5)        (57.6)
  Interest expense                 (202.1)       (203.7)       (241.7)
- ---------------------------------------------------------------------
Income (loss) from
  continuing operations
  before income taxes            $ (781.1)       $ 14.6       $ 370.9
- ---------------------------------------------------------------------
  Identifiable assets           $ 2,668.5     $ 2,583.4     $ 2,593.3
  Corporate assets                4,444.7       4,610.0       4,756.1
- ---------------------------------------------------------------------
  Total assets                  $ 7,113.2     $ 7,193.4     $ 7,349.4
=====================================================================


NOTE 15  Employee plans
- -----------------------

Retirement benefits
- -------------------
Defined benefit retirement income plans cover the majority of domestic
employees and certain employees in countries outside the United States.
In the United States, the company has retirement plans under which funds
are deposited with a trustee. Major subsidiaries outside the United
States provide for employee pensions in accordance with local
requirements and customary practices, and several maintain funded
defined benefit plans.

For plans covered by the Employee Retirement Income Security Act
("ERISA"), the company's funding policy is to fund in accordance with
ERISA funding standards. The various benefit formulas and the funding
methods used in the international plans are in accordance with local
requirements. Plan assets generally are invested in common stocks,
fixed-income securities, insurance contracts, and real estate. At
December 31, 1995, the assets of the company's U.S. pension plans
included approximately 1.8 million shares of the company's common stock
valued at approximately $9.7 million.

Net curtailment gains of $14.9, $8.3, and $7.4 million
have been recognized in 1995, 1994, and 1993, respectively.

Stock plans
- -----------
Under plans approved by the stockholders, stock options, stock
appreciation rights, restricted stock and performance units may be
granted to officers and other key employees. 

Options have been granted to purchase the company's common stock at 
100% of the fair market value at the date of grant. Options have a 
maximum duration of ten years and become exercisable in annual installments 
over a two, three or four year period following date of grant.

Other postretirement benefits
- -----------------------------
The company provides certain health care benefits for U.S. employees who
retired or terminated after qualifying for such benefits. Most
international employees are covered by government-sponsored programs and
the cost to the company is not significant. The company expects to fund
its share of such benefit costs principally on a pay-as-you-go-basis.

The company adopted SFAS 106 effective January 1, 1993. SFAS 106
required the company to change from the cash basis of accounting for
such benefits by requiring the accrual, during the years that the
employee renders services, of the estimated cost of providing such
benefits.

In 1992, the company announced changes to its post-retirement benefit
plans, effective January 1, 1993, whereby the company's current subsidy
would be phased out, ending as of January 1, 1996. Several lawsuits have
been brought by plan participants challenging the announced changes to
the plans, and the company is defending them vigorously. In 1994,
several of these lawsuits were resolved which resulted in the company
recognizing income of $13.8 million ($8.0 million amortization of prior
service benefit and $5.8 million settlement).

Net periodic postretirement benefit cost for 1995, 1994 and 1993
includes the following components:

- ---------------------------------------------------------------------
Year ended December 31 (Millions)           1995      1994      1993
=====================================================================
Service cost - benefits earned
  during the period                         $ .1     $ 1.0     $ 1.2
Interest cost on accumulated
  postretirement benefit obligation         17.6      22.1      26.1
Amortization of prior service
  benefit                                   (8.5)     (8.0)
Net amortization and deferral                3.6      (2.5)       .5
Return on plan assets                       (4.2)       .5      (3.3)
- ---------------------------------------------------------------------
Net periodic postretirement
  benefit cost                             $ 8.6    $ 13.1    $ 24.5
=====================================================================

The status of the plan and amounts recognized in the company's
consolidated balance sheet at December 31, 1995 and 1994 were as
follows:

- ----------------------------------------------------------------------
Year ended December 31 (Millions)                     1995       1994
======================================================================
Actuarial present value of
accumulated postretirement
benefit obligation:
  Retirees                                         $ 223.4    $ 240.2
  Fully eligible active plan participants                        14.9
  Other active plan participants                                 12.3
- ----------------------------------------------------------------------
                                                     223.4      267.4
Less plan assets at fair value                       (27.3)     (26.5)
- ----------------------------------------------------------------------
Accrued postretirement benefit liability
  in excess of plan assets                           196.1      240.9
Unrecognized net loss                                 (8.3)     (27.9)
Unrecognized prior service benefit                    30.9       39.2
- ----------------------------------------------------------------------
Accrued postretirement benefit obligation
recognized in the consolidated balance sheet       $ 218.7    $ 252.2
======================================================================

As of December 31, 1995, the entire liability was classified
as long-term.

The assumed rate of return on plan assets, which are principally
invested in fixed-income securities, was 8% in 1995 and 1994,
respectively, and the weighted average discount rate used to measure the
accumulated postretirement benefit obligation was 7.5% at December 31,
1995 and 8.75% at December 31, 1994. The assumed health care cost trend
rate used in measuring the expected cost of benefits covered by the plan
was 9.5% for 1996, gradually declining to 6% in 2006 and thereafter. A
one-percentage point increase in the assumed health care cost trend rate
would increase the accumulated postretirement benefit obligation at
December 31, 1995 by $11.3 million and increase the aggregate of the
service and interest cost components of net periodic postretirement
health care benefit cost by $1.0 million.


Retirement benefits
- -------------------
The plans' funded status and amounts recognized in the company's
consolidated balance sheet at December 31, 1995 and 1994 were as
follows:

<TABLE>
<CAPTION>
                              -----------------------------------------      ---------------------------------------
                                 Assets Exceed Accumulated Benefits             Accumulated Benefits Exceed Assets
                              -----------------------------------------      ---------------------------------------
                                   U.S. Plans            Int'l Plans            U.S. Plans            Int'l Plans
                              --------------------    -----------------      -----------------    ------------------
(Millions)                       1995       1994       1995       1994        1995       1994       1995       1994
====================================================================================================================
<S>                           <C>        <C>          <C>        <C>         <C>        <C>       <C>         <C>
Actuarial present value of
  benefit obligations:
  Vested benefit obligation   $ 3,165.4  $ 2,702.4    $ 631.3    $ 519.7     $ 49.8     $ 40.5    $  31.8     $ 44.9
- --------------------------------------------------------------------------------------------------------------------
  Accumulated benefit
    obligation                $ 3,226.7  $ 2,773.2    $ 642.9    $ 536.0     $ 51.0     $ 42.1    $  50.2     $ 67.6
- --------------------------------------------------------------------------------------------------------------------
  Projected benefit
    obligation                $ 3,254.2  $ 2,798.3    $ 674.7    $ 603.8     $ 53.4     $ 45.1     $ 58.4     $ 75.7
Plan assets at fair value       3,390.8    2,961.1      784.1      652.8                             27.0       42.5
- --------------------------------------------------------------------------------------------------------------------
Projected benefit obligation
  less than (in excess of)
  plan assets                     136.6      162.8      109.4       49.0      (53.4)     (45.1)     (31.4)     (33.2)
Unrecognized net loss (gain)      580.0      507.6       (3.9)      37.9       12.4        4.2         .7        7.7
Unrecognized prior service
  (benefit) cost                  (65.8)     (86.7)       4.2        4.7        2.2        2.2        1.2        2.0
Unrecognized net (asset)
  obligation at date of
  adoption                          (.4)       (.4)      (4.3)      (1.8)       4.0        4.8        4.7        3.5
- --------------------------------------------------------------------------------------------------------------------
Prepaid pension cost (pension
  liability) recognized in the
  consolidated balance sheet    $ 650.4    $ 583.3   $  105.4     $ 89.8    $ (34.8)   $ (33.9)   $ (24.8)   $ (20.0)
====================================================================================================================
</TABLE>


<TABLE>
<CAPTION>
Net periodic pension cost for 1995, 1994, and 1993 includes the following components:

                                  ------------------------   ------------------------
                                         U.S. Plans            International Plans
                                  ------------------------   ------------------------
(Millions)                          1995     1994     1993     1995     1994     1993
=====================================================================================
<S>                               <C>      <C>      <C>      <C>      <C>      <C>
Service cost - benefits earned
  during the period               $ 33.8   $ 44.1   $ 43.2   $ 22.9   $ 22.2   $ 18.4
Interest cost on projected
  benefit obligation               245.2    231.5    229.9     49.5     42.7     42.3
Return on assets                  (684.1)     5.6   (343.1)   (85.6)    33.8   (116.1)
Net amortization and deferral      355.2   (293.7)    42.7     25.3    (86.8)    58.2
- -------------------------------------------------------------------------------------
Net periodic pension
  (income) cost                  $ (49.9) $ (12.5) $ (27.3)  $ 12.1   $ 11.9    $ 2.8
- -------------------------------------------------------------------------------------

The assumptions used to determine the above data were as follows:

Discount rate                       7.50%    8.75%    7.38%    7.23%    7.48%    6.93%
Rate of increase in
  compensation levels               5.40%    5.40%    5.13%    4.08%    4.43%    4.27%
Expected long-term rate of
  return on assets                 10.00%   10.00%   10.00%    8.37%    8.40%    9.15%
=====================================================================================
</TABLE>

Stock plans
- -----------
A summary of the changes in shares under option for all plans follows:

<TABLE>
<CAPTION>

                                     ---------------------------    ---------------------------
Year ended December 31                          1995                           1994
===============================================================================================
(Shares in thousands)                 Shares       Price Range       Shares       Price Range
- -----------------------------------------------------------------------------------------------
<S>                                  <C>        <C>                 <C>        <C>
Outstanding at beginning of year     17,473.5   $ 3 3/4 - 44 1/2    15,402.2   $ 3 3/4 - 44 1/2
Granted                               4,331.5   $ 5 5/8 - 11 1/4     4,499.2   $ 8 5/8 - 14 3/8
Exercised                              (471.3)  $ 3 3/4 - 9 7/8       (654.0)  $ 3 3/4 - 14 7/8
Canceled                             (3,904.7)                      (1,773.9)
- -----------------------------------------------------------------------------------------------
Outstanding at end of year           17,429.0   $ 4 1/8 - 44 1/2    17,473.5   $ 3 3/4 - 44 1/2
- -----------------------------------------------------------------------------------------------
Exercisable at end of year            9,996.7                        9,619.9
- -----------------------------------------------------------------------------------------------
Shares available for granting
  options at end of year              4,480.2                        2,104.5
===============================================================================================
</TABLE>

NOTE 16  Stockholders' equity
- -----------------------------
Changes in stockholders' equity during the three years ended December
31, 1995 were as follows:

<TABLE>
<CAPTION>
                                                                                          Other Capital
                                                                                   -----------------------------
                                                                                                          Other,
                                                                       Retained                          Princi-
                                       Preferred Stock                 Earnings                           pally
                                -----------------------------  Common (Accumulated Treasury Translation  Paid-in
(Millions)                       Series A  Series B  Series C   Stock   Deficit)    Stock  Adjustments   Capital
================================================================================================================
<S>                             <C>          <C>      <C>       <C>     <C>        <C>      <C>       <C>
Balance at December 31, 1992    $ 1,428.0    $ 50.0   $ 100.0   $ 1.6   $(228.0)   $(13.6)  $(337.5)  $ 1,243.6
Issuance of stock under stock
  option and other plans                                                             (1.7)                  7.1
Contribution to pension plan                                       .1                                      89.2
Net income                                                                565.4
Dividends                                                                (177.6)
Translation adjustments                                                                       (23.3)
Other                                (7.8)
- ----------------------------------------------------------------------------------------------------------------
Balance at December 31, 1993      1,420.2      50.0     100.0     1.7     159.8     (15.3)   (360.8)    1,339.9
Issuance of stock under stock
  option and other plans                                                              (.7)                  3.6
Net income                                                                100.5
Dividends                                                                (214.6)
Translation adjustments                                                                        20.0
Other                                  .1                                                                    .1
- ----------------------------------------------------------------------------------------------------------------
Balance at December 31, 1994      1,420.3      50.0     100.0     1.7      45.7     (16.0)   (340.8)    1,343.6
Issuance of stock under stock
  option and other plans                                                              (.3)                  2.7
Net income (loss)                                                        (624.6)
Dividends                                                                (123.7)
Translation adjustments                                                                         1.6
- ----------------------------------------------------------------------------------------------------------------
Balance at December 31, 1995    $ 1,420.3    $ 50.0   $ 100.0   $ 1.7  $ (702.6)  $ (16.3) $ (339.2)  $ 1,346.3
================================================================================================================
</TABLE>


The company has 360,000,000 authorized shares of common stock, par value
$.01 per share. The company has 40,000,000 shares of authorized
preferred stock, par value $1 per share, issuable in series.

In 1993, the company contributed seven million shares of its common
stock, valued at $89.2 million, to its U.S. pension plan.

The company has authorization to issue up to 30,000,000 shares of Series
A Cumulative Convertible Preferred Stock ("Series A Preferred Stock"),
10 shares of Series B Cumulative Convertible Preferred Stock ("Series B
Preferred Stock") and 20 shares of Series C Cumulative Convertible
Preferred Stock ("Series C Preferred Stock").

Each share of Series A Preferred Stock (i) accrues quarterly cumulative
dividends of $3.75 per share per annum, (ii) has a liquidation
preference of $50.00 plus accrued and unpaid dividends, (iii) is
convertible into 1.67 shares of the company's common stock, subject to
customary anti-dilution adjustments, and (iv) is redeemable at the
option of the company under certain circumstances and at varying prices.
If, on the date used to determine stockholders of record for a meeting
of stockholders at which directors are to be elected, preferred stock
dividends are in arrears in an amount equal to at least six quarterly
dividends, the number of members of the Board of Directors will be
increased by two as of the date of such stockholders' meeting and the
holders of shares of Series A Preferred Stock will be entitled to vote
for and elect such two additional directors.

Mitsui & Co., Ltd. ("Mitsui") owns $150 million of convertible preferred
stock, which includes 10 shares of Series B Preferred Stock and 20
shares of Series C Preferred Stock. The Series B Preferred Stock and the
Series C Preferred Stock are convertible at the option of the holder
into the company's common stock at conversion prices of $20.00 and
$21.00 per share, respectively, subject to customary anti-dilution
adjustments. Both Series B Preferred Stock and Series C Preferred Stock
(i) have a stated value of $5 million per share, (ii) accrue quarterly
cumulative dividends based on such stated value at 8 7/8% per annum until
June 28, 1995 and 9 1/2% per annum from June 28, 1995 to June 28, 1997,
(iii) accrue dividends on the amount of any unpaid dividends, (iv) are
redeemable at the option of the company at a premium that is determined
by reference to interest rates then in effect and the amount of time
then remaining to June 28, 1997, and (v) are entitled to receive upon
liquidation the stated value plus accrued and unpaid dividends. In the
event that the Series B Preferred Stock and Series C Preferred Stock
have not been previously redeemed by the company or converted by the
holder, the company will be required to convert both series into the
company's common stock based on the then-current market price after June
28, 1996 (or after June 28, 1995 if so requested by Mitsui, the original
holder of the Series B Preferred Stock and Series C Preferred Stock), or
earlier under certain extraordinary circumstances, and conduct a managed
sale program of the common stock. Such conversions and sales must, in
general, be completed by June 28, 1997. To the extent that the proceeds
received by Mitsui from such managed sale program are less than the
stated value of the shares so converted, plus accrued and unpaid
dividends and a present valued premium amount if such conversion takes
place before June 28, 1997, the company has agreed to issue additional
shares of capital stock to Mitsui which will be sold in a manner
approved by the company until Mitsui receives proceeds equal to the sum
of such amounts. Shares of Series B Preferred Stock and Series C
Preferred Stock rank pari passu with each other and with Series A
Preferred Stock, and the holders of Series A, B and C Preferred Stock
have priority as to dividends over holders of the company's common stock
and other series or classes of the company's stock that rank junior with
regard to dividends. Each series of Cumulative Convertible Preferred
Stock is non-voting except with respect to certain matters relating to
the rights and preferences of such series. With respect to such matters,
each of the Series B Preferred Stock and Series C Preferred Stock votes
separately as a class. The Series A Preferred Stock also votes as a
class on these matters, but its class includes the Series B Preferred
Stock and Series C Preferred Stock, as well as any other series of
preferred stock having equal rank as to dividends and liquidation
rights.

Each outstanding share of common stock has attached to it one preferred
share purchase right. Each right entitles the registered holder to
purchase for $75, under certain circumstances, one three-hundredth of a
share of Junior Participating Preferred Stock, par value $1 per share.
The rights become exercisable only if a person or group acquires 20% or
more of the company's common stock, or announces a tender or exchange
offer for 30% or more of the common stock. If the company is acquired
(or survives in a reverse merger transaction) or 50% or more of its
consolidated assets or earning power are sold, each right will entitle
its holder to purchase a number of the acquiring company's common shares
(or the company's common shares) having a market value of $150. The
company will be entitled to redeem the rights at one and two-thirds
cents per right prior to the earlier of the expiration of the rights, or
the time that a 20% position has been acquired. Until the rights become
exercisable, they have no dilutive effect on net income per common
share.

At December 31, 1995, 113.5 million shares of unissued common stock of
the company were reserved for the following: 57.2 million for
convertible preferred stock, 33.7 million for the 8 1/4 % convertible
subordinated debentures and 22.6 million for stock options and stock
purchase plans.

Changes in issued shares during the three years ended December 31, 1995
were as follows:

<TABLE>
<CAPTION>
                                 -----------------------------------------------------------
                                         Preferred Stock
                                 -----------------------------      Common          Treasury
                                   Series A  Series B Series C       Stock           Stock
============================================================================================
<S>                              <C>         <C>      <C>         <C>              <C>
Balance at December 31, 1992     28,559,598      10      20       162,604,036      (672,555)
Issuance of stock under stock
  option and other plans                                            1,566,568      (133,628)
Contribution to pension plan                                        7,000,000
Other                              (155,159)                              423
- --------------------------------------------------------------------------------------------
Balance at December 31, 1993     28,404,439      10      20       171,171,027      (806,183)
Issuance of stock under stock
  option and other plans                                              654,024       (58,861)
Other                                   747                             2,298
- --------------------------------------------------------------------------------------------
Balance at December 31, 1994     28,405,186      10      20       171,827,349      (865,044)
Issuance of stock under stock
  option and other plans                                              488,726       (27,965)
Other                                   (37)                               60
- --------------------------------------------------------------------------------------------
Balance at December 31, 1995     28,405,149      10      20       172,316,135      (893,009)
============================================================================================
</TABLE>


<PAGE>

Report of Independent Auditors
- ------------------------------

To the Board of Directors of Unisys Corporation

We have audited the accompanying consolidated balance sheets of Unisys
Corporation at December 31, 1995 and 1994, and the related consolidated
statements of income and cash flows for each of the three years in the
period ended December 31, 1995. These financial statements are the
responsibility of Unisys Corporation's management. Our responsibility is
to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are
free of material misstatement. An audit includes examining, on a test
basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles
used and significant estimates made by management, as well as evaluating
overall financial statement presentation. We believe that our audits
provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present
fairly, in all material respects, the consolidated financial position of
Unisys Corporation at December 31, 1995 and 1994, and the consolidated
results of its operations and its cash flows for each of the three years
in the period ended December 31, 1995, in conformity with generally
accepted accounting principles.

As discussed in Note 4 to the consolidated financial statements, in 1993
Unisys Corporation changed its method of accounting for postretirement
benefits other than pensions and income taxes.



/s/ ERNST & YOUNG LLP


Philadelphia, Pennsylvania
January 26, 1996

<PAGE>

<TABLE>
SUPPLEMENTAL FINANCIAL DATA (UNAUDITED)
Unisys Corporation
Quarterly financial information
- --------------------------------------------------------------------------------------
<CAPTION>
                                       First     Second     Third    Fourth 
(Millions, except per share data)    Quarter    Quarter   Quarter   Quarter       Year
- --------------------------------------------------------------------------------------
1995
======================================================================================
<S>                                 <C>        <C>       <C>       <C>       <C>
Revenue                             $1,407.1   $1,495.8  $1,460.7  $1,838.7  $6,202.3
Gross profit                           494.4      533.8     447.2     119.8   1,595.2
Income (loss) from continuing 
  operations before income taxes        48.4       60.6     (48.8)   (841.3)   (781.1)
Income (loss) from continuing 
  operations                            32.1       39.8     (32.2)   (667.0)   (627.3)
Income (loss) from discontinued 
  operations                            12.5                           (9.8)      2.7 
Net income (loss)                       44.6       39.8     (32.2)   (676.8)   (624.6)
Dividends on preferred shares           29.9       30.0      30.2      30.2     120.3
Earnings (loss) on common shares        14.7        9.8     (62.4)   (707.0)   (744.9)
Earnings (loss) per common share - 
 primary and fully diluted
  Continuing operations                  .02        .06      (.36)    (4.06)    (4.37)
  Discontinued operations                .07                           (.06)      .02
- --------------------------------------------------------------------------------------
  Total                                  .09        .06      (.36)    (4.12)    (4.35)
- --------------------------------------------------------------------------------------
Market price per common share - high  10 1/8     11 3/4        11     8 5/8    11 3/4
                              - low    8 1/2      9 1/8     7 5/8     5 1/2     5 1/2
======================================================================================

1994
- --------------------------------------------------------------------------------------
Revenue                             $1,305.8   $1,441.5  $1,481.9  $1,749.0  $5,978.2
Gross profit                           513.2      548.1     549.3     552.2   2,162.8
Income (loss) from continuing 
  operations before income taxes        47.6       31.0      43.0    (107.0)     14.6
Income (loss) from continuing 
  operations before 
  extraordinary item                    34.6       22.7      30.8     (76.0)     12.1
Income from discontinued operations     33.1       27.2      12.1      23.7      96.1
Net income (loss)                       60.0       49.9      42.9     (52.3)    100.5
Dividends on preferred shares           30.1       30.0      30.0      30.0     120.1
Earnings (loss) on common shares        29.9       19.9      12.9     (82.3)    (19.6)
Earnings (loss) per common 
 share - primary
  Continuing operations                  .02       (.04)      .01      (.62)     (.63)
  Discontinued operations                .19        .16       .07       .14       .56
  Extraordinary item                    (.04)                                    (.04)
- --------------------------------------------------------------------------------------
  Total                                  .17        .12       .08      (.48)     (.11)
- --------------------------------------------------------------------------------------
Earnings (loss) per common share - 
 fully diluted
  Continuing operations                  .05       (.01)      .02      (.62)     (.63)
  Discontinued operations                .16        .13       .06       .14       .56
  Extraordinary item                    (.04)                                    (.04)
- --------------------------------------------------------------------------------------
  Total                                  .17        .12       .08      (.48)     (.11)
- --------------------------------------------------------------------------------------
Market price per common share - high  16 1/2     15 1/4    11 1/4    12 1/8    16 1/2
                              - low   12 1/2      8 5/8     8 5/8     8 1/4     8 1/4
======================================================================================
<FN>
In the fourth quarter of 1995, the company recorded charges of $846.6 
million, or $3.90 per fully diluted common share, and in the fourth 
quarter of 1994, the company recorded a restructuring charge of $186.2 
million, or $.78 per fully diluted common share. See Note 2 of the 
Notes to Consolidated Financial Statements.

The individual quarterly per common share amounts may not total to the 
per common share amount for the full year because of accounting 
rules governing the computation of earnings per common share.

Market prices per common share are as quoted on the New York Stock 
Exchange composite listing.
</TABLE>


<PAGE>

<TABLE>
Five-year summary of selected financial data
- --------------------------------------------------------------------------------------
<CAPTION>
(Millions, except per share data)   1995<F1>   1994<F1>      1993      1992  1991<F1>
======================================================================================
<S>                                 <C>        <C>       <C>       <C>       <C>
Results of operations
Revenue                             $6,202.3   $5,978.2  $5,980.8  $6,600.9  $6,791.1
Operating income (loss)               (698.1)     154.4     572.4     573.5    (732.0)
Income (loss) from continuing 
  operations before income taxes      (781.1)      14.6     370.9     301.3  (1,425.6)
Income (loss) from continuing 
  operations before extraordinary 
  items and changes in 
  accounting principles               (627.3)      12.1     286.3     166.3  (1,520.2)
Net income (loss)                     (624.6)     100.5     565.4     361.2  (1,393.3)
Dividends on preferred shares          120.3      120.1     121.6     122.1     121.2
Earnings (loss) on common shares      (744.9)     (19.6)    443.8     239.1  (1,514.5)
Earnings (loss) from continuing 
  operations per common share
    Primary                            (4.37)      (.63)     1.00       .27    (10.16)
    Fully diluted                      (4.37)      (.63)     1.17       .33    (10.16)
Financial position
Working capital                        $71.3   $1,015.7    $681.0    $513.3    $384.3
Total assets                         7,113.2    7,193.4   7,349.4   7,322.1   8,218.7
Long-term debt                       1,533.3    1,864.1   2,025.0   2,172.8   2,694.6
Common stockholders' equity<F2>        289.9    1,034.2   1,057.3     541.8     342.1
Common stockholders' equity
  per share                             1.69       6.05      6.21      3.35      2.12
- --------------------------------------------------------------------------------------
Other data
Engineering, research 
  and development                     $409.5     $463.6    $489.3    $505.6    $610.6
Capital additions of properties 
  and rental equipment                 195.0      208.2     173.5     227.0     222.7
Investment in marketable software      123.0      121.3     118.7     110.2     167.7
Depreciation                           203.0      226.2     252.0     311.4     412.1
Amortization
  Marketable software                  151.7      150.5     144.6     131.8     241.0 
  Cost in excess of net 
    assets acquired                     40.9       36.9      36.7      36.8     246.6
Common shares outstanding (millions)   171.4      171.0     170.4     161.9     161.7
Stockholders of record (thousands)      41.5       45.3      47.8      51.7      54.6
Employees (thousands)                   37.4       37.8      38.2      41.7      46.4
======================================================================================
<FN>
<F1> Includes special pretax charges of $846.6 million, $186.2 million and 
     $1,200.0 million for the years ended December 31, 1995, 1994, and 1991, 
     respectively.
<F2> After deduction of cumulative preferred dividends in arrears.
</TABLE>


<PAGE>

<TABLE>
Revenue by similar classes of products and services
- ----------------------------------------------------------------------------------------------
<CAPTION>
Year ended December 31 (Millions)                 1995              1994              1993
==============================================================================================
<S>                                         <C>                <C>               <C>
Enterprise systems and servers              $1,118.4   18%     $1,415.3  24%     $1,648.4  28%
Departmental servers and desktop systems       795.3   13         749.6  12         750.3  12 
Software                                       732.6   12         712.2  12         779.9  13 
- ----------------------------------------------------------------------------------------------
Total sales                                  2,646.3   43       2,877.1  48       3,178.6  53 
Information services and 
  systems integration                        2,198.1   35       1,759.4  30       1,358.2  23 
Equipment maintenance                        1,357.9   22       1,341.7  22       1,444.0  24 
- ----------------------------------------------------------------------------------------------
Total                                       $6,202.3  100%     $5,978.2 100%     $5,980.8 100%
==============================================================================================
</TABLE>

Enterprise systems and servers comprise a complete line of small to 
large processors and related communications and peripheral products, 
such as printers, storage devices, and document handling processors and 
equipment. Departmental servers and desktop systems include UNIX 
servers, workstations, personal computers, and terminals. Software 
consists of application and systems software. Information services and 
systems integration includes systems integration, outsourcing services, 
application development, information planning, and education. Equipment 
maintenance results from charges for preventive maintenance, spare 
parts, and other repair activities.

Individual products have been assigned to a specific class based on a 
variety of factors. Over time, reclassification of products may be 
necessary because of changing technology, company strategy, and market 
conditions. Such evolution from year to year must be kept in mind when 
using this table for trend analysis.




                                                              EXHIBIT 21

                       SUBSIDIARIES OF THE REGISTRANT


Unisys Corporation, the registrant, a Delaware company, has no parent.
The registrant owns directly or indirectly all the voting securities of
the following subsidiaries:
                                                 State
                                                or Other
                                             Jurisdiction
                                               Under the
                                             Laws of Which
              Name of Company                  Organized
              ---------------                -------------

       Unisys Canada Inc.                      Canada
       Convergent Technologies, Inc.           California
       Unisys Australia Limited                Michigan
       Unisys Espana S. A.                     Spain
       Unisys (Schweiz) A.G.                   Switzerland
       Unisys Belgium                          Belgium
       Unisys Deutschland G.m.b.H.             Germany
       Unisys Eletronica Ltda.                 Brazil
       Unisys France                           France
       Unisys Italia S.p.A.                    Italy
       Unisys Limited                          England
       Unisys Nederland N.V.                   Netherlands
       Unisys de Mexico, S.A. de C.V.          Mexico
       Unisys Korea Limited                    Korea
       Unisys South Africa, Inc.               Delaware
       Unisys de Colombia, S.A.                Delaware

The names of certain subsidiaries are omitted from the above list; such
subsidiaries, considered in the aggregate as a single subsidiary, would not
constitute a significant subsidiary.




                                                             EXHIBIT 23

                   CONSENT OF INDEPENDENT AUDITORS


We consent to the incorporation by reference in this Annual Report 
(Form 10-K) of Unisys Corporation of our report dated January 26, 
1996, included in the 1995 Annual Report to Stockholders of Unisys 
Corporation.

Our audits also included the financial statement schedule of Unisys 
Corporation listed in Item 14(a).  This schedule is the 
responsibility of Unisys Corporation's management.  Our responsibility 
is to express an opinion based on our audits.  In our opinion, the 
financial statement schedule referred to above, when considered in 
relation to the basic financial statements taken as a whole, presents 
fairly in all material respects the information set forth therein.

We consent to the incorporation by reference in the following 
Registration Statements: (1) Registration Statement (Form S-8 No. 33-
20588) pertaining to the Unisys Savings Plan, (2) Registration 
Statement (Form S-8 No. 33-7893) pertaining to the Burroughs LTIP, (3) 
Registration Statement (Form S-8 No. 2-76948) pertaining to Burroughs 
Employees 1972 Payroll Deduction Stock Purchase Plans, (4) 
Registration Statement (Form S-8 No. 33-4317) pertaining to the 
Burroughs 1985 Payroll Deduction Stock Purchase Plan,
 (5) Registration 
Statement (Form S-8 No. 33-20204) pertaining to the Unisys Retirement 
Investment Plan, (6) Registration Statement (Form S-8 No. 33-20205) 
pertaining to the Unisys Retirement Investment Plan II, (7) 
Registration Statement (Form S-3 No. 33-25715) of Unisys Corporation, 
(8) Registration Statement (Form S-8 No. 33-3937) pertaining to the 
Burroughs LTIP, (9) Registration Statement (Form S-8 No. 2-63842) 
pertaining to the Burroughs LTIP, (10) Registration Statement (Form S-
8 No. 33-34771) pertaining to the Unisys Retirement Investment Plan, 
(11) Registration Statement (Form S-8 No. 33-38711) pertaining to the 
Unisys Savings Plan, (12) Registration Statement (Form S-8 No. 33-
38712) pertaining to the Unisys Retirement Investment Plan II, (13) 
Registration Statement (Form S-8 No. 33-38713) pertaining to the 
Unisys Retirement Investment Plan, (14) Registration Statement (Form 
S-8 No. 33-40259) pertaining to the Unisys LTIP, (15) Registration 
Statement (Form S-3 No. 33-35437) of Unisys Corporation, (16) 
Registration Statement (Form S-3 No. 33-64396) of Unisys Corporation, 
and (17) Registration Statement (Form S-3 No.33-51747) of Unisys 
Corporation; of our report dated January 26, 1996 with respect to 
the financial statements incorporated herein by reference and our 
report included in the preceding paragraph with respect to the 
financial statement schedule included in the 1995 Annual Report 
(Form 10-K) of Unisys Corporation for the year ended December 31, 1995.

/s/ ERNST & YOUNG LLP

Philadelphia, Pennsylvania
February 21, 1996


                                                             EXHIBIT 24

                            POWER OF ATTORNEY
                            Unisys Corporation
                        Annual Report on Form 10-K
                   for the year ended December 31, 1995


     KNOW ALL MEN BY THESE PRESENTS, that each person whose signature 
appears below does hereby make, constitute and appoint JAMES A. UNRUH, 
HAROLD S. BARRON AND EDWARD A. BLECHSCHMIDT, and each one of them 
severally, his true and lawful attorneys-in-fact and agents, for such 
person and in such person's name, place and stead, to sign the Unisys 
Corporation Annual Report on Form 10-K for the year ended December 31, 
1995, and any and all amendments thereto and to file such Annual 
Report on Form 10-K and any and all amendments thereto with the 
Securities and Exchange Commission, and does hereby grant unto such 
attorneys-in-fact and agents, and each of them, full power and 
authority to do and perform each and every act and thing requisite or 
necessary to be done in and about the premises, as fully to all 
intents and purposes as said person might or could do in person, 
hereby ratifying and confirming all that such attorney-in-fact and 
agents and each of them may lawfully do or cause to be done by virtue 
hereof.

Dated:  January 25, 1996


/s/ J. P. Bolduc                        /s/ Kenneth A. Macke
- -----------------------                --------------------------
J. P. Bolduc                           Kenneth A. Macke
Director                               Director


/s/ James J. Duderstadt                /s/
 Theodore E. Martin
- -----------------------                --------------------------
James J. Duderstadt                    Theodore E. Martin
Director                               Director


/s/ Gail D. Fosler                     /s/ Robert McClements, Jr.
- -----------------------                --------------------------
Gail D. Fosler                         Robert McClements, Jr.
Director                               Director


/s/ Melvin R. Goodes                   /s/ Alan E. Schwartz
- -----------------------                --------------------------
Melvin R. Goodes                       Alan E. Schwartz
Director                               Director


/s/ Edwin A. Huston                    /s/ James A. Unruh
- -----------------------                --------------------------
Edwin A. Huston                        James A. Unruh
Director                               Chairman of the Board, Chief
                                        Executive Officer and Director



<TABLE> <S> <C>

<ARTICLE>     5
<LEGEND>      THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED
              FROM THE COMPANY'S FINANCIAL STATEMENTS INCLUDED IN THE
              COMPANY'S FORM 10-K FOR THE FISCAL YEAR ENDED
              DECEMBER 31, 1995 AND IS QUALIFIED IN ITS ENTIRETY BY
              REFERENCE TO FORM 10-K.
<MULTIPLIER>  1,000,000
       
<S>                                          <C>
<PERIOD-TYPE>                                12-MOS
<FISCAL-YEAR-END>                            DEC-31-1995
<PERIOD-END>                                 DEC-31-1995
<CASH>                                             1,114
<SECURITIES>                                           5
<RECEIVABLES>                                      1,092
<ALLOWANCES>                                         (82)
<INVENTORY>                                          674
<CURRENT-ASSETS>                                   3,219
<PP&E>                                             2,088
<DEPRECIATION>                                     1,397
<TOTAL-ASSETS>                                     7,113
<CURRENT-LIABILITIES>                              3,147
<BONDS>                                            1,533
<COMMON>                                               2
<PREFERRED-MANDATORY>                                  0
<PREFERRED>                                        1,570
<OTHER-SE>                                           288
<TOTAL-LIABILITY-AND-EQUITY>                       7,113
<SALES>                                            2,646
<TOTAL-REVENUES>                                   6,202
<CGS>                                              1,611
<TOTAL-COSTS>                                      4,607
<OTHER-EXPENSES>                                       0
<LOSS-PROVISION>                                      21
<INTEREST-EXPENSE>                                   202
<INCOME-PRETAX>                                     (781)
<INCOME-TAX>                                        (154)
<INCOME-CONTINUING>                                 (627)
<DISCONTINUED>                                         2
<EXTRAORDINARY>                                        0
<CHANGES>                                              0
<NET-INCOME>                                        (625)
<EPS-PRIMARY>                                      (4.35)
<EPS-DILUTED>                                      (4.35)
        

</TABLE>