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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
___________

FORM 10-Q

For the transition period from _________________ to _________________

Commission File No. 1-4850

Registrant's Telephone Number, Including Area Code: (310) 615-0311

          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 whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act).                          Yes [X]   No [   ]

          187,576,312 shares of Common Stock, $1.00 par value, were outstanding on January 30, 2004.

 See accompanying notes.

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General

The following discussion and analysis provides information management believes relevant to an assessment and understanding of the consolidated results of operations and financial condition of Computer Sciences Corporation (CSC or the Company). The discussion should be read in conjunction with the interim consolidated condensed financial statements and notes thereto and the Company's Annual Report on Form 10-K for the year ended March 28, 2003. The following discusses the Company's results of operations and financial condition for the three and nine months ended January 2, 2004, and the comparable periods for the prior fiscal year.

Overview

Key highlights of the third quarter and year-to-date include:

• Third quarter revenues rose 29.6%, approximately 23% before currency fluctuations. The Company's March 2003 acquisition of DynCorp contributed 25.3 percentage points.
• Nine months year-to-date revenues increased 30.2%, approximately 25% on a constant currency basis, and with 25.5 percentage points coming from the DynCorp acquisition.
• Net income was up 21.5% for the third quarter and 18.5% year-to-date.
• Record contract awards were achieved for the quarter ($6.0 billion) and for the nine months ($13.8 billion).
• Fiscal 2004 net income includes DynCorp acquisition-related pretax special charges of $7.3 million and $22.7 million in the third quarter and nine months, respectively. No further DynCorp acquisition-related charges are expected.
• The DynCorp acquisition continues to meet expectations. Purchase accounting valuations will be completed in the fourth quarter.
• Strong European outsourcing growth offset continued weakness in the region's consulting and systems integration markets.
• Debt-to-total capitalization ratio at quarter-end was improved to 31.8% from 35.0% at fiscal 2003 year-end.
• Cash flows from operating activities generated $673.7 million for the first nine months of fiscal 2004 versus $472.2 million in the prior year. Cash used for investing activities was $819.8 million for fiscal 2004 to-date versus $491.0 million for the fiscal 2003 comparable period.

Record contract awards in the third quarter continued the year's strong performance. The Company's announced awards through nine months already make this the highest year ever for contract awards. Third quarter awards included $4.8 billion related to Global Commercial activities and $1.2 billion related to new U.S. Federal awards. Significant awards included: United Kingdom National Health Service ($1.7 billion), SAS Group ($1.5 billion), Swiss Re ($700 million), National Grid Transco ($470 million), U.S. Postal Service ($200 million) and U.S. Department of Veterans Affairs ($200 million).

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Management considers new contract awards an important measurement as they are indicative of future revenue. The Company's growth and new contract awards have created a broad, long-term global revenue base across numerous customers, industries, geographic regions and service offerings, providing significant diversity to cushion the Company from specific market or geographic downturns and also provide various avenues of future growth opportunities. Over 80% of CSC's revenues come from long-term contracts including Global Commercial outsourcing and U.S. Federal government engagements.

Revenue growth for the third quarter and nine months of fiscal 2004 was led by CSC's U.S. Federal sector which benefited significantly from the acquisition of DynCorp in March 2003. The anniversary date of the DynCorp acquisition will occur during the fourth quarter on March 7, and thus the favorable year-over-year revenue comparisons for this portion of the Federal business will not continue. Currency exchange rates shifts during the year have also continued to favorably impact revenue, but future changes in currency rates cannot be predicted. Softness in demand for short-term, project-oriented consulting and systems integration services has continued outside the U.S., particularly in Europe, but such weaker European revenues have thus far been offset by stronger outsourcing business. Lower discretionary spending from the ongoing global economic sluggishness continues to affect consulting and systems integration markets globally.

Continued focus on the balance sheet enabled the Company to pay down debt and improve its debt-to-capitalization ratio. Receivables were up from the second quarter, and for the year, due to the increases in revenue, currency fluctuations, and a heavier than usual impact of the year-end holidays on U.S. Federal government payment processing. Management looks to Days Sales Outstanding (DSO) as one factor in monitoring and managing its receivables, as it is a good indicator of how quickly receivables are being turned into cash. DSO at quarter-end was 91 days, down from the prior year third quarter of 93 days but up from the fiscal 2004 second quarter of 87 days. DSO can be calculated various ways by companies and therefore CSC's DSO may not necessarily be comparable to that reported by other companies. CSC calculates DSO as follows: Total receivables at quarter-end divided by revenue-per-day. Revenue-per-day equals total revenues for the quarter divided by the exact number of calendar days in the quarter.

Higher cash flow generated from operating activities in fiscal 2004 came from increased earnings and larger non-cash expense components such as depreciation and amortization. Higher outflows of cash for investing activities were primarily a result of up-front investments for new outsourcing contracts that required fixed asset purchases as well as other capitalized costs.

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Revenues - Third Quarter

During the third quarter ended January 2, 2004, the Company's total revenues increased 29.6%, or $827.6 million to $3,621.2 million, over the same period last year. On a constant currency basis, total revenues increased approximately 23%. The operations of DynCorp, which the Company acquired on March 7, 2003, provided approximately 25.3 percentage points of the Company's overall revenue growth.

U.S. Federal sector revenue increased 87.0%, or $690.5 million to $1,484.5 million during the third quarter. DynCorp accounted for approximately 89 percentage points of growth, which was offset by slight declines in Federal sector's other operations, mainly from certain Department of Defense contracts. These declines included an approximately 2.1 percentage point impact of a previously consolidated joint venture's revenue no longer being reported by CSC due to a reorganization that resulted in minority ownership for CSC. In addition, level of effort was down for the quarter on a logistics contract with the Army as the first deployment of the core project was completed. Another significant contract had been terminated at the end of the fiscal 2003 third quarter. Increased level of effort during the quarter on a U.S. Navy multiple awards contract and increased work on a variety of Department of Defense task order contracts partially offset the revenue reductions.

Global Commercial sector revenue increased 6.8%, or $135.2 million to $2,136.7 million, over the same quarter of last year. Global Commercial revenue benefited by approximately 9 percentage points due to currency fluctuations in Europe, Australia and Asia.

U.S. Commercial revenue declined 7.6%, or $74.1 million to $896.6 million during the third quarter of fiscal 2004 compared to the same period last year. Significantly reduced scope on the renewal of one engagement for which CSC was previously the primary outsourcing provider and is now a subcontractor accounted for approximately 3.7 percentage points of the decline. Two outsourcing contracts that substantially ended during fiscal 2003 accounted for approximately 2.3 percentage points of the decline. Lower outsourcing revenue also resulted from client reductions in billable volumes and discretionary projects. Lower outsourcing activities were partially offset by several new contracts, which in aggregate contributed approximately $62 million in revenue. The most significant new projects include Motorola, Ascension Health, and Bombardier Transportation.

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European revenue of $933.2 million for the third quarter increased 22.8%, or $173.1 million compared to the same period in the prior year. Currency fluctuations favorably impacted revenue growth by approximately 17 percentage points. New outsourcing contracts contributed approximately $195 million in revenue growth, including Royal Mail Group, Bombardier Transportation, Marconi, ISS Group, and the United Kingdom's Department of Health. Declines in European consulting and systems integration services, as well as the financial services market sector, were offset by revenue gains in outsourcing activities.

Other International revenue for the third quarter increased 13.4% to $306.9 million. Currency fluctuations favorably impacted revenue growth by approximately 17 percentage points. The favorable currency impact was principally offset by a $13 million decline in outsourcing activities and an $8.4 million decline in third party product sales in Australia.

Revenues - Nine Months

The Company's total revenues increased 30.2%, or $2,499.8 million to $10,767.2 million during the nine months ended January 2, 2004, as compared to the same period last year. On a constant currency basis, total revenues increased approximately 25%. The operations of DynCorp provided 25.5 percentage points of the Company's overall revenue growth. The Company utilizes a fiscal reporting calendar and the first quarter of fiscal 2004 included an additional week of business operations compared to the same period last year. Excluding the former DynCorp operations, the additional week of operations is estimated to have contributed approximately 1 percentage point in revenue growth for the nine months, with the estimate taking into account CSC's outsourcing and professional services arrangements.

U.S. Federal sector revenue increased 93.0%, or $2,185.7 million to $4,535.9 million during the first nine months of fiscal 2004. DynCorp accounted for approximately 90 percentage points of the revenue growth. The remaining revenue growth in Federal sector came primarily from Department of Defense contracts, most notably missile defense and a U.S. Navy multiple awards contract.

Global Commercial sector revenue increased 5.3%, or $312.2 million to $6,231.3 million, over the first nine months of last year. Global Commercial revenue benefited by approximately 7 percentage points due to currency fluctuations in Europe, Australia and Asia.

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U.S. Commercial revenue declined 6.3%, or $183.2 million to $2,741.6 million during the first nine months of fiscal 2004 compared to the same period last year. Significantly reduced scope on the renewal of one engagement for which CSC was previously the primary outsourcing provider and is now a subcontractor accounted for approximately 3.5 percentage points of the decline. Two outsourcing contracts that substantially ended during fiscal 2003 accounted for approximately 3.2 percentage points of the decline. New projects in aggregate contributed approximately $202 million in revenue for the nine months ended January 2, 2004, with the most significant contributions for the year coming from Motorola, Bombardier Transportation, and Ascension Health.

European revenue increased 21.6%, or $461.9 million to $2,604.3 million for the first nine months compared to the same period in the prior year. Approximately 15 percentage points of the increase was due to currency fluctuations. New outsourcing contracts accounted for the remaining growth, partially offset by declines in consulting and integration services as well as the financial services market sector. Approximately $410 million in revenue for the nine months was from new outsourcing contracts, with the largest contributions from Royal Mail Group, Bombardier Transportation, the United Kingdom's Department of Health, Marconi, and ISS Group.

Other International revenue for the first nine months increased 3.9% to $885.4 million. Growth was favorably impacted by approximately 12 percentage points from currency fluctuations. A $53 million decline in outsourcing activities in Australia, plus weaker third party product sales in Australia and Asia, offset the currency impact.

Costs and Expenses

The Company's costs and expenses as a percentage of revenue are as follows:

Comparing the third quarter and the first nine months of fiscal 2004 and 2003, total costs and expenses increased slightly as a percentage of revenue. Higher costs of services as a percentage of revenue and the impact of the special item in fiscal 2004 were mostly offset by lower depreciation and amortization, and selling, general and administrative costs.

The Company substantially matches revenues and costs in the same currency. Therefore, the foreign currency impact of approximately 6 percentage points for the quarter and 5 percentage points for the nine months on revenues and costs did not have a material impact on costs and expenses as a percentage of revenue.

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The increase in costs of services as a percentage of revenue was principally caused by the former DynCorp operations, for which the expense mix is weighted more toward cost of services. The former DynCorp operations costs of services were running at 90% for the quarter and nine months, thus increasing CSC's consolidated cost of services as a percentage of revenue by approximately 2.2 percentage points for the quarter and 1.9 percentage points for the nine months ended January 2, 2004. Improvements in other operations offset much of the DynCorp impact for the quarter, particularly in the U.S. Federal sector, including adjustments from normal program reviews that resulted in increased profitability on long-term contracts and from the final settlement for modifications to a fixed-price contract.

Lower selling, general and administrative expenses (SG&A) as a percentage of revenue were also significantly driven by the former DynCorp operations, which carry a lower SG&A expense as a percentage of revenue (approximately 4.2% for the quarter and 3.7% for the nine months of fiscal 2004) than the composite of other CSC operations. Excluding the effects of the former DynCorp operations, the Company's SG&A expense as a percentage of revenue would have been approximately flat for the quarter at 6.0%, and down just .1 percentage point to 6.2% for the nine months ended January 2, 2004.

Depreciation and amortization costs as a percentage of revenue for the primarily labor-oriented DynCorp operations ran at approximately 1% in the quarter and nine months, which had a favorable impact on reducing the consolidated ratio. The DynCorp costs are predominantly for amortization of the purchased intangible assets. Offsetting increases at other CSC operations in the third quarter resulted in no overall change, and a change year-to-date of .5 percentage points. The increases were primarily in the other Federal operations as well as U.S. Commercial outsourcing business, and were due to a shift in business mix to more long-term outsourcing and less project work, resulting in relatively more capitalized costs as long-term outsourcing contracts typically require investments in infrastructure.

Net interest expense remained virtually unchanged as a percentage of revenue compared to the same period in the prior year. Net interest increased $6.4 million and $19.3 million for the quarter and nine months versus the same periods in the prior year, and is principally related to additional borrowings compared to the same period last year, driven in part by funding needs for the DynCorp acquisition.

Special Items

As disclosed in the Company's fiscal 2003 Annual Report on Form 10-K, the Company reviewed its operations, product strategies and the carrying value of its assets to identify any potential exit or disposal activities in connection with the DynCorp acquisition during March 2003. As a result, during the third quarter and nine months ended January 2, 2004, special items of $7.3 million and $22.7 million ($5.0 million and $14.6 million after tax) or 3 cents and 8 cents per share (diluted) were recorded, respectively. The charges include equipment and related disposal costs that cannot accommodate the larger, integrated U.S. Federal sector business, and such equipment's use has been discontinued. In addition, certain CSC facilities were no longer needed as a result of the acquisition and costs to exit those facilities are also included in the special items. Since its acquisition of DynCorp, the Company has recorded $27.9 million of special charges related to exit and disposal activities arising from the acquisition. No additional special charges related to the acquisition are expected.

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Income Before Taxes

Income before taxes increased to $185.9 million and $474.4 million in the fiscal 2004 third quarter and first nine months, respectively, versus $147.6 million and $388.2 million in the corresponding prior periods. The resulting pre-tax margins were 5.1% and 4.4% for the quarter and nine months, respectively, compared with 5.3% and 4.7% for the corresponding periods in the prior year. The special item described above contributed to the decline, which was also affected by changes in operating costs and expenses as described above. The gross increase in income before taxes was also partially attributable to favorable currency fluctuations.

Income Taxes

The provisions for income taxes in fiscal 2004 and 2003 are based upon estimated effective tax rates, including the impact of permanent differences between the book basis of assets and liabilities recognized for financial reporting purposes and the basis recognized for tax purposes. The provision for income taxes increased by $15.6 million and $34.9 million for the three and nine months ended January 2, 2004, respectively, from the comparable periods last year. The increases were due primarily to higher pre-tax income in both the three and nine months ended January 2, 2004, and higher estimated effective tax rates in the three and nine months ended January 2, 2004, compared to the same periods last year. The Company's effective tax rates approximated 30.9% and 30.7% for the three and nine months ended January 2, 2004, respectively, compared to 28.4% and 28.5% in the comparable periods in fiscal 2003. Effective tax rates on earnings before the Special Items were 30.9% for the three and nine month periods ended January 2, 2004, respectively. The increase in the effective rates is a result of increased profits and the decreasing impact of existing favorable permanent tax differences that do not vary directly with increased profits.

Net Income and Earnings per Share

Net income was $128.4 million for the third quarter of fiscal 2004, up from $105.7 million for the third quarter of fiscal 2003. Fiscal 2004 third quarter diluted earnings per share were 68 cents (including 3 cents per share impact of special items) versus 61 cents reported for last year's third quarter.

For the nine months ended January 2, 2004, net income was $328.8 million, up from $277.5 million for the corresponding period last year. Diluted earnings per share for the first nine months of fiscal 2004 was $1.74 (including 8 cents per share impact of special items) versus $1.61 reported for last year's first nine months.

Cash Flows

Cash provided by operating activities was $673.7 million for the nine months ended January 2, 2004, compared with cash provided by operating activities of $472.2 million during the same period last year. The increase of $201.5 million primarily resulted from higher earnings coupled with an increase in non-cash expenses (primarily depreciation and amortization expense). Net working capital needs did not change significantly.

The Company's net cash used in investing activities totaled $819.8 million for the first nine months of fiscal 2004, compared to $491.0 million during the same period last year. The increase principally relates to investments in property and equipment and outsourcing contract costs in support of major new contract activities including Motorola, Marconi, and the Royal Mail Group. In addition, a significant cash inflow of $73.6 million a year ago related to the disposition of assets associated with the completion of an outsourcing contract was not repeated in fiscal 2004.

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Cash used by financing activities was $9.6 million for the first three quarters of fiscal 2004, versus $20.2 million provided by financing activities for the same period a year ago. The change was driven principally by net repayments of debt in the current period versus a net increase in borrowings a year ago. See related discussion in Financial Condition section below.

Financial Condition

During the first nine months of fiscal 2004, the Company's capital outlays included $723.8 million of business investments in the form of fixed asset purchases and outsourcing contract costs. These investments were funded from operating cashflows, additional borrowings, and existing cash balances, which decreased from $299.6 million as of March 28, 2003, to $148.4 million at January 2, 2004. The Company's debt-to-total capitalization ratio decreased from 35.0% at March 28, 2003 to 31.8% at January 2, 2004.

During fiscal 2002, the Company filed a shelf registration statement covering up to $1.5 billion of debt and/or equity securities. As of January 2, 2004, the shelf registration has $900 million of unissued debt or equity securities.

The Company has an option to require a subsidiary of Equifax Inc. to purchase the Company's credit reporting business as further described in Note 13 to the Consolidated Financial Statements included in the Company's Annual Report on Form 10-K for fiscal 2003. The exercise price of this put option is equal to the appraised value of the business.

It is management's opinion that the Company will be able to meet its liquidity and cash needs for the foreseeable future through a combination of cash flows from operating activities, cash balances, unused borrowing capacity and other financing activities, including the issuance of debt and/or equity securities, and/or the exercise of the put option described above.

The Company's sources of liquidity include the issuance of commercial paper and short-term borrowings. If the Company were unable to sell commercial paper or if the Company determined it was too costly to do so, the Company has the ability to borrow under two syndicated backstop credit facilities.

At January 2, 2004, the Company's syndicated credit facilities were comprised of a $354 million facility, which expires August 13, 2004, and a $321 million facility, which expires August 18, 2005. As of January 2, 2004, the Company had no borrowings under these facilities and is in compliance with all terms of the agreements.

At January 2, 2004, the Company had $58.8 million of short-term debt and current maturities of long-term debt and $2.4 billion of long-term debt, including $91.8 million of commercial paper borrowings. As further described in Note 7 to the Consolidated Financial Statements included in the Company's Annual Report on Form 10-K for fiscal 2003, the classification of the Company's outstanding commercial paper is determined by the expiration dates of its backstop credit facilities.

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Recent accounting pronouncements and the anticipated impact to the Company are described in the notes to the interim consolidated condensed financial statements included in this Form 10-Q as well as in the Company's Annual Report on Form 10-K for the year ended March 28, 2003.

The accounting policies that the Company considers critical are described in "Management's Discussion and Analysis" of the Company's Annual Report on Form 10-K for fiscal 2003, and relate to revenue recognition, outsourcing contract costs, software development costs and retirement benefits. Most of the accounting policies that require the Company to make estimates are for estimates on contract-specific issues and thus do not have broad, company-wide implications or risks. While revisions to estimates or assumptions on a specific contract could result in a material adjustment to the financial statements, the risk is mitigated by the Company's broad portfolio of contracts that would typically have offsetting adjustments. The risks of changes in company-wide accounting estimates related to retirement benefits are further described in the aforementioned Form 10-K.

Forward-Looking Statements

All statements in this quarterly report on Form 10-Q and in the documents attached or incorporated by reference that do not directly and exclusively relate to historical facts constitute "forward-looking statements" within the meaning of the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements represent current expectations and beliefs of CSC, and no assurance can be given that the results described in such statements will be achieved.

Forward-looking information contained in these statements include, among other things, statements with respect to the Company's financial condition, results of operations, cash flows, business strategies, operating efficiencies or synergies, competitive positions, growth opportunities, plans and objectives of management, and other matters. Such statements are subject to numerous assumptions, risks, uncertainties and other factors, many of which are outside of the Company's control, that could cause actual results to differ materially from the results described in such statements.

These factors include, without limitation, the following: (i) changes in the Global Commercial demand for information technology outsourcing, business process outsourcing and consulting and systems integration services; (ii) changes in U.S. federal government spending levels for information technology and other services; (iii) competitive pressures; (iv) the credit worthiness of the Company's commercial customers; (v) the Company's ability to recover its accounts receivable; (vi) the Company's ability to recover its capital investment in outsourcing contracts; (vii) the Company's ability to continue to develop and expand its service offerings to address emerging business demands and technological trends; (viii) the future profitability of the Company's long-term contracts with customers; (ix) the future profitability of the Company's fixed-price contracts; (x) the Company's ability to consummate and integrate acquisitions and form alliances; (xi) the Company's ability to attract and retain qualified personnel; (xii) early termination of client contracts; and (xiii) general economic conditions and fluctuations in currency exchange rates in countries in which the Company does business.

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The Company is engaged in providing services under contracts with the U.S. Government. These contracts are subject to extensive legal and regulatory requirements and, from time to time, agencies of the U.S. Government investigate whether the Company's operations are being conducted in accordance with these requirements. U.S. Government investigations of the Company, whether related to the Company's federal government contracts or conducted for other reasons, could result in administrative, civil or criminal liabilities, including repayments, fines or penalties being imposed upon the Company, or could lead to suspension or debarment from future U.S. Government contracting.

Forward-looking statements in this quarterly report on Form 10-Q speak only as of the date hereof, and forward-looking statements in documents attached or incorporated by reference speak only as to the date of those documents. The Company does not undertake any obligation to update or release any revisions to any forward-looking statement or to report any events or circumstances after the date hereof or to reflect the occurrence of unanticipated events, except as required by law.

For a discussion of the Company's market risk associated with interest rates and foreign currencies as of March 28, 2003, see "Quantitative and Qualitative Disclosures about Market Risk" in the Part II, Item 7A, "Management's Discussion and Analysis of Financial Condition and Results of Operations," of the Company's Annual Report on Form 10-K for the fiscal year then ended. For the nine months ended January 2, 2004, there has been no significant change in related market risk factors.

"Disclosure controls and procedures" are the controls and other procedures of an issuer that are designed to ensure that information required to be disclosed by the issuer in the reports filed or submitted by it under the Securities Exchange Act of 1934, as amended (the Exchange Act) is recorded, processed, summarized and reported, within the time periods specified in the Securities and Exchange Commission's rules and forms. "Disclosure controls and procedures" include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in its Exchange Act reports is accumulated and communicated to the issuer's management, including its principal executive and financial officers, as appropriate to allow timely decisions regarding required disclosure.

The Company's Chief Executive Officer and Chief Financial Officer have evaluated the Company's disclosure controls and procedures as of January 2, 2004 and, based upon this evaluation, have concluded that they are effective in all material respects.

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"Internal control over financial reporting" is a process designed by, or under the supervision of, the issuer's principal executive and financial officers, and effected by the issuer's board of directors, management, and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles and includes those policies and procedures that:

During the fiscal quarter ended January 2, 2004, there was no change in the Company's internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, the Company's internal control over financial reporting.

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Pursuant to the requirements 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.