Third-quarter revenue at Computer Task Group Inc. (NASD: CTGX) rose 10.6% to $89.1 million, and net income increased 127.7% to $2.1 million.

The Buffalo NY-based information technology staffing and solutions firm said earnings were boosted by higher margin solutions business, including its healthcare solutions business.

"Our healthcare solutions developed in 2007 and launched this year, along with our strong existing healthcare offerings, are paying off in new higher margin business," said Chairman and CEO James Boldt.

Operating income rose 112.7% to $3.5 million. Gross margin, however, narrowed to 22.0% from 22.7%.

CTG forecast revenue of $86 million to $88 million in the fourth quarter, a year-over-year increase of 2% to 4%, the company reported. However, financial analysts had estimated revenue of $95 million, according to Web portal Yahoo.com.

Computer Task Group Inc. (NASD: CTGX)
For the third quarter ended Sept. 26, 2008, compared with the same period in 2007.
Revenue: $89.1 million, +10.6%
Net income: $2.1 million, +127.7%