8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 8-K

CURRENT REPORT PURSUANT
TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

Date of report (Date of earliest event reported): February 3, 2005

Cerner Corporation

(Exact Name of Registrant as Specified in Its Charter)

Delaware

(State or Other Jurisdiction of Incorporation)

0-15386	43-1196944
(Commission File Number)	(IRS Employer Identification No.)
2800 Rockcreek Parkway, North Kansas City, Missouri	64117
(Address of Principal Executive Offices)	(Zip Code)

(816) 221-1024

(Registrant’s Telephone Number, Including Area Code)

Not Applicable

(Former Name or Former Address, if Changed Since Last Report)

     Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

     o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

     o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

     o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

     o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

TABLE OF CONTENTS

	Item 1.01. Entry Into A Material Definitive Agreement.
	Item 2.02. Results of Operations and Financial Condition.
	Item 5.02. Departure of Directors or Principal Officers; Election of Directors; Appointment of Principal Officers
	Item 7.01. Regulation FD Disclosure.
	Item 9.01 Financial Statements and Exhibits.
SIGNATURES
EXHIBIT INDEX
Indemnification Agreement
Press Release

Item 1.01. Entry Into A Material Definitive Agreement.

On February 3, 2005, in connection with the Board appointment set forth below in Item 5.02, Cerner Corporation (the “Company”) and John C. Danforth entered into an Indemnification Agreement (the “Agreement”) providing Mr. Danforth with indemnification rights in consideration of Mr. Danforth’s acceptance of his position with and his continued service to the Company as a Director. The Agreement provides for Cerner to hold harmless and indemnify Mr. Danforth, to the fullest extent permitted by Delaware law and in accordance with the Company’s Bylaws, Articles of Incorporation and the Agreement, and is substantially similar to the indemnification agreements entered into with the Company’s other current Directors, pursuant to Company policy to enter into indemnification agreements with each of its Directors.

The foregoing description of the Agreement does not purport to be a complete statement of the parties’ rights and obligations under the Agreement and the transactions contemplated thereby. The above description is qualified in its entirety by reference to the Agreement which is filed with this Current Report on Form 8-K as Exhibit 99.1 and is incorporated herein by reference.

Item 2.02. Results of Operations and Financial Condition.

On February 3, 2005, the Company issued a press release announcing, among other things, its financial results for the three and twelve month periods ended January 1, 2005. The press release is furnished as Exhibit 99.2 and is attached hereto.

To supplement our consolidated financial statements presented in accordance with GAAP, the Company uses non-GAAP measures of operating results, net income and earnings per share, which are adjusted from results based on GAAP to exclude certain expense items. The Company also discloses certain non-GAAP financial measures, such as bookings revenue, revenue backlog (which includes contract backlog and support and maintenance backlog) and free cash flow. These non-GAAP measures are provided to enhance the user’s overall understanding of our financial performance, and as required, are also reconciled to GAAP. These non-GAAP measurements are not recognized in accordance with GAAP and should not be viewed as an alternative to GAAP measures of performance.

The information contained in this Form 8-K (including Exhibit 99.2) is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise be subject to the liabilities of that section. The information is this Item 2.02 shall not be incorporated by reference into any registration statement or other document pursuant to the Securities Act of 1933, except as otherwise expressly stated in such filing.

Item 5.02. Departure of Directors or Principal Officers; Election of Directors; Appointment of Principal Officers

On February 3, 2005, the Board of Directors of the Company, by statement of unanimous consent, appointed John C. Danforth to the Company’s Board of Directors, to hold office for a term expiring at the Annual Meeting of Shareholders held in May 2005, to fill the vacant Director position created by Mr. Danforth’s resignation from the Board which was effective June 24, 2004.

Mr. Danforth was a Director of the Company from May 1996 through June 2004. Mr. Danforth served as Ambassador to the United Nations from June 2004 through January 2005 and represented the State of Missouri in the U.S. Senate for 18 years until 1994.

In connection with the appointment to the Company’s Board of Directors, the Board of Directors also named Mr. Danforth to the Company’s Compensation and Nominating, Governance & Public Policy Committees, effective February 3, 2005.

Additionally, Paul M. Black was appointed to act as Chief Operating Officer of the Company effective February 1, 2005. Prior to his appointment to Chief Operating Officer, Mr. Black served as the Company’s Executive Vice President of the U.S. Client Organization.

The information required by Item 5.02(c)(2) of Form 8-K in connection with Mr. Black’s appointment as Chief Operating Officer is incorporated herein by reference to: (i) Item 4A of the Company’s Annual Report on Form 10-K for the fiscal year ended on January 3, 2004, filed with the Securities and Exchange Commission on March 18, 2004; and (ii) the Company’s Definitive Proxy Statement on Schedule 14A filed with the Commission on April 20, 2004.

Item 7.01. Regulation FD Disclosure.

The Company issued its earnings press release on February 3, 2005, which also announced the appointment of Mr. Danforth to the Company’s Board of Directors. A copy of the press release is furnished with this Current Report on Form 8-K as Exhibit 99.2 and is incorporated herein by reference.

The information contained in Item 7.01 to this Current Report on Form 8-K (including Exhibit 99.2) is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise be subject to the liabilities of that section. The information in this Item 7.01 (including Exhibit 99.2) shall not be incorporated by reference into any registration statement or other document pursuant to the Securities Act of 1933, except as otherwise expressly stated in such filing.

Item 9.01 Financial Statements and Exhibits.

c)   Exhibits

99.1	Indemnification Agreement, dated February 3, 2005, by and between John C. Danforth and Cerner Corporation.
99.2	Press release issued by Cerner Corporation dated February 3, 2005.

SIGNATURES

     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, hereunto duly authorized.

	CERNER CORPORATION
Date: February 3, 2005	By:	/s/ Marc G. Naughton
		Marc G. Naughton, Senior Vice President,
		Treasurer and Chief Financial Officer

EXHIBIT INDEX

Exhibit
Number	Description
99.1	Indemnification Agreement, dated February 3, 2005, by and between John C. Danforth and Cerner Corporation.
99.2	Press release issued by Cerner Corporation dated February 3, 2005.

EX-99.1

Exhibit 99.1

INDEMNIFICATION AGREEMENT

     THIS AGREEMENT is made and entered into this 3^rd day of February, 2005, between Cerner Corporation, a Delaware corporation (“Corporation”), and John C. Danforth (“Indemnitee”).

     WITNESSETH:

     WHEREAS, Indemnitee is a member of the board of directors of the Corporation and as such is performing a valuable service for the Corporation; and

     WHEREAS, although Indemnitee has certain rights to indemnification under the Bylaws and Certificate of Incorporation of the Corporation, such Bylaws and Certificate of Incorporation specifically provide that they are not exclusive and thereby contemplate that the Corporation may enter into agreements with its officers and directors; and

     WHEREAS, the Corporation and Indemnitee desire to enter into this Agreement to provide to Indemnitee additional rights to indemnification in consideration of Indemnitee’s acceptance of his position with and his continued service to the Corporation as a director;

     NOW, THEREFORE, inconsideration of Indemnitee’s acceptance of his position with and his continued service as a director of the Corporation after the date hereof and for and in consideration of the premises and the covenants contained herein, the Corporation and Indemnitee do hereby promise and agree as follows:

     1. Indemnification. The Corporation hereby agrees to hold harmless and indemnify Indemnitee to the fullest extent permitted by Section 145, Title 8 of the Delaware Code, as in effect on the date of the execution of this Agreement and as it may hereafter be amended, or any other statutory provision permitting or authorizing such indemnification which is adopted subsequent to the execution of this Agreement.

     2. Maintenance of Insurance. So long as Indemnitee shall continue to serve as a director of the Corporation (or shall continue at the request of the Corporation or on behalf of the Corporation to serve as a director, officer, employee or agent to any Other Enterprise) and thereafter so long as Indemnitee shall be subject to any possible claim or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative, investigative or appellate by reason of the fact that Indemnitee is or was a director of the Corporation (or is or was serving in any of said other capacities at the request of the Corporation), the Corporation may maintain director liability insurance if such insurance becomes reasonably available and if, in the business judgment of the board of directors of the Corporation as it may exist from time to time, both (i) the premium cost for such insurance is reasonable, and (ii) the coverage provided by such insurance is not so limited by exclusions that there is insufficient benefit provided by such director liability insurance.

     3. Additional Indemnification. Subject only to the provisions in Sections 4, 5, 6 and 7 of this Agreement, the Corporation hereby further agrees to hold harmless and indemnify Indemnitee:

         (a) Against any and all liabilities and expenses, including without limitation, judgments, amounts paid in settlement (provided that such settlement and all amounts paid

  in connection therewith are approved in advance by the Corporation, which approval shall not be unreasonably withheld), attorneys’ fees, ERISA excise taxes or penalties, fines and other expenses actually and reasonably incurred by Indemnitee in connection with any threatened, pending or completed action, suit or proceeding (including without limitation the investigation, defense, settlement or appeal of such action, suit or proceeding), whether civil, criminal, administrative, investigative or appellate (including an action by or in the right of the Corporation) to which Indemnitee is, was or at any time becomes a party, or is threatened to be made a party, by reason of the fact that Indemnitee is, was or at any time becomes a director of the Corporation, or is or was serving at the request of the Corporation as a director, officer, agent or employee of any Other Enterprise; and

         (b) Otherwise to the fullest extent as may be provided to Indemnitee by the Corporation pursuant to the non-exclusivity provisions of paragraph 28 of the Corporation’s Bylaws and subsection (f) of Section 145, Title 8 of the Delaware Code relating to indemnification.

     4. Limitations on Additional Indemnification. (a) The Corporation will not hold Indemnitee harmless or provide indemnification pursuant to Section 3 hereof:

(1) except to the extent that the aggregate amount of losses to be indemnified thereunder exceeds the amount of such losses for which Indemnitee is indemnified either pursuant to (i) the Corporation’s Certificate of Incorporation, Bylaws, vote of stockholders or disinterested directors or other agreement, (ii) Sections 1 or 2 hereof, (iii) pursuant to any director liability insurance purchased and maintained by or on behalf of Indemnitee by the Corporation, or (iv) otherwise than pursuant to this Agreement;

(2) in respect of remuneration paid to Indemnitee if it shall be determined by a final judgment or other final adjudication that such remuneration was in violation of law;

(3) on account of any suit for an accounting of profits made from the purchase or sale by Indemnitee of securities of the Corporation pursuant to Section 16(b) of the Securities Exchange Act of 1934 and amendments thereto or similar provisions of any federal, state or local law;

(4) on account of Indemnitee’s conduct which is finally adjudged by a court to have been knowingly fraudulent, deliberately dishonest or willful misconduct; or

(5) if a final adjudication by a court having jurisdiction in the matter shall determine that such indemnification is not lawful.

         (c) Notwithstanding any other provisions of this Agreement, if the Indemnitee is or was serving as a director of the Corporation, or is or was serving at the request of the Corporation as a director, officer, employee or agent of any Other Enterprise, and has been successful on the merits or otherwise in defense of any action, suit or proceeding referred to in Section 3 of this Agreement (including the dismissal of any such action, suit or proceeding without prejudice), or in defense of any claim, issue or matter therein, he shall be indemnified against expenses (including attorneys’ fees) actually and reasonably incurred by him in connection therewith to the extent he has not been fully indemnified therefor otherwise than pursuant to this Agreement.

2

     5. Advancement of Expenses. Expenses (including attorneys’ fees) actually and reasonably incurred by an Indemnitee who may be entitled to indemnification hereunder in defending an action, suit or proceeding, whether civil, criminal, administrative, investigative or appellate, shall be paid by the Corporation in advance of the final disposition of such action, suit or proceeding upon receipt of an undertaking by or on behalf of such Indemnitee to repay such amount if it shall ultimately be determined that the Indemnitee is not entitled to indemnification by the Corporation. Notwithstanding the foregoing, no advance shall be made by the Corporation if a determination is reasonably and promptly made by (i) the board of directors by a majority vote of a quorum consisting of directors who were not parties to the action, suit or proceeding from which the advancement is requested, or (ii) if a quorum is not obtainable, or even if obtainable, if a quorum of disinterested directors so directs, by independent legal counsel in a written opinion, or (iii) by the stockholders, that, based upon the facts known to the board, counselor stockholders at the time such determination is made, such Indemnitee acted in bad faith and in a manner that such Indemnitee did not believe to be in or not opposed to the best interests of the Corporation, or, with respect to any criminal proceeding, that such Indemnitee believed or had reasonable cause to believe his conduct was unlawful. In no event shall any advance be made in instances where the board, stockholders or independent legal counsel reasonably determines that such Indemnitee deliberately breached his duty to the Corporation or its stockholders.

     6. Notification and Defense of Claim. Promptly after receipt by Indemnitee of notice of the commencement of any action, suit or proceeding, Indemnitee will, if a claim in respect thereof is to be made against the Corporation under this Agreement, notify the Corporation of the commencement thereof; but the omission so to notify the Corporation will not relieve it from any liability which it may have to Indemnitee otherwise than under this Agreement. With respect to any such action, suit or proceeding as to which Indemnitee notifies the Corporation of the commencement thereof:

(a)

The Corporation will be entitled to participate therein at its own expense;

(b)

Except as otherwise provided below, to the extent that it may wish, the Corporation jointly with any other indemnifying party similarly notified will be entitled to assume the defense thereof, with counsel satisfactory to Indemnitee. After notice from the Corporation to Indemnitee of its election so to assume the defense thereof, the Corporation will not be liable to Indemnitee under this Agreement for any legal or other expenses subsequently incurred by Indemnitee in connection with the defense thereof other than reasonable costs of investigation or as otherwise provided below. Indemnitee shall have the right to employ its own counsel in such action, suit or proceeding but the fees and expenses of such counsel incurred after notice from the Corporation of its assumption of the defense thereof shall be at the expense of Indemnitee unless (i) the employment of counsel by Indemnitee has been authorized by the Corporation, (ii) Indemnitee shall have reasonably concluded that there may be a conflict of interest between the Corporation and Indemnitee in the conduct of the defense of such action, or (iii) the Corporation shall not in fact have employed counsel to assume the defense of such action, in each of which cases the fees and expenses of counsel shall be at the expense of the Corporation. The Corporation shall not be entitled to assume the defense of any action, suit or proceeding brought by or on behalf of the Corporation or as to which Indemnitee shall have made the conclusion provided for in (ii) above; and

3

(c)   The Corporation shall not be liable to indemnify Indemnitee under this Agreement for any amounts paid in settlement of any action or claim effected without its prior written consent. The Corporation shall not settle any action or claim in any manner which would impose any penalty or limitation on Indemnitee without Indemnitee’s written consent. Neither the Corporation nor Indemnitee will unreasonably withhold their consent to any proposed settlement.

     7. Determination of Right to Indemnification. Prior to indemnifying an Indemnitee pursuant to this Agreement, unless ordered by a court, the Corporation shall determine that such Indemnitee is entitled thereto under the terms of this Agreement. Any determination that a person shall or shall not be indemnified under this Agreement shall be made by the board of directors by a majority vote of a quorum consisting of directors who were not parties to the action, suit or proceeding, or if such quorum is not obtainable, or even if obtainable, if a quorum of disinterested directors so directs, by independent legal counsel in a written opinion or by the stockholders, and such determination shall be final and binding upon the Corporation; provided, however, that in the event such determination is adverse to the Indemnitee, such Indemnitee shall have the right to maintain an action in any court of competent jurisdiction against the Corporation to determine whether or not such Indemnitee is entitled to such indemnification hereunder. If such court action is successful and the Indemnitee is determined to be entitled to such indemnification, such Indemnitee shall be reimbursed by the Corporation for all fees and expenses (including attorneys’ fees) actually and reasonably incurred in connection with any such action (including without limitation the investigation, defense, settlement or appeal of such action). This Agreement shall be applicable to any claim asserted after the date hereof whether such claim arises from acts or omissions occurring before or after the date hereof.

     8. Certain Definitions. For purposes of this Agreement, references to “Other Enterprise” shall include without limitation any other corporation, partnership, joint venture, trust or employee benefit plan; references to “fine” or “fines” shall include any excise taxes assessed on Indemnitee with respect to any employee benefit plan; references to “defense” shall include investigations of any action, suit or proceeding as well as appeals in any threatened, pending or completed action, suit or proceeding and shall also include any defensive assertion of a cross claim or counterclaim; and references to “serving at the request of the Corporation” shall include any service as a director of the Corporation which imposes duties on, or involves services by, Indemnitee with respect to an employee benefit plan, its participants or beneficiaries; and if Indemnitee acted in good faith and in a manner he reasonably believed to be in the interest of the participants and beneficiaries of an employee benefit plan he shall be deemed to have acted in a manner “not opposed to the best interests of the Corporation” as referred to in this Agreement. For the purpose of this Agreement, unless the board of directors of the Corporation shall determine otherwise, any Indemnitee who shall serve as an officer or director of any Other Enterprise of which the Corporation, directly or indirectly, is a stockholder or creditor, or in which the Corporation is in any way interested, shall be presumed to be serving as such director or officer at the request of the Corporation. In all other instances where any Indemnitee shall serve as a director, officer, employee or agent of an Other Enterprise, if it is not otherwise established that such Indemnitee is or was serving as such director, officer, employee or agent at the request of the Corporation, the board of directors of the Corporation shall determine whether such Indemnitee is or was serving at the request of the Corporation, and it shall not be necessary to show any actual or prior request for such service, which determination shall be final and binding on the Corporation and the Indemnitee seeking indemnification.

     9. Continuation and Enforcement of Indemnification.

4

(a)	The Corporation expressly confirms and agrees that it has entered into this Agreement and assumes the obligations imposed on the Corporation hereby in order to induce Indemnitee to continue as a director of the Corporation and acknowledges that Indemnitee is relying upon this Agreement in continuing in such capacity. The rights to indemnification and advancement of expenses created by or provided pursuant to this Agreement are bargained-for conditions of Indemnitee’s acceptance and/or maintenance of his election or appointment as a director of the Corporation and such rights shall continue after Indemnitee has ceased to be a director of the Corporation or a director, officer, employee or agent of any Other Enterprise and shall inure to the benefit of Indemnitee’s heirs, executors, administrators and estate.
(b)	Indemnitee expressly confirms and agrees that under no circumstances shall the language or any of the promises and covenants contained in this Agreement be construed or interpreted as creating a contract of employment.
(c)	To the fullest extent permitted by the laws of the State of Delaware, Indemnitee shall have the right to maintain an action in any court of competent jurisdiction to enforce and/or recover damages for breach of the rights to indemnification created by or provided pursuant to the terms of this Agreement. If such court action is successful, Indemnitee shall be reimbursed by the Corporation for all fees and expenses (including attorneys’ fees) actually and reasonably incurred in connection with such action (including without limitation the investigation, defense, settlement or appeal of such action).

     10. Non-Exclusivity. The right to indemnification pursuant to this Agreement shall not be deemed exclusive of any other rights of indemnification to which Indemnitee may be entitled under any statute, other agreement, the Certificate of Incorporation, Bylaws, pursuant to a vote of stockholders or disinterested directors, insurance policy or otherwise, both as to actions in his official capacity and as to action in another capacity while holding his directorship, and shall not limit in any way any right the Corporation may have to create additional or independent or supplementary obligations to indemnify Indemnitee.

     11. Severability. Each of the provisions of this Agreement is a separate and distinct agreement independent of the others, and if any provision of this Agreement or the application of any provision hereof to any person or circumstance is held invalid, illegal or unenforceable by a court for any reason whatsoever, the remaining provisions of this Agreement and the application of such provision to other persons or circumstances shall not be affected thereby. The parties hereto expressly agree that any provision hereof held invalid, illegal or unenforceable shall be construed and modified by the court finding such provision invalid, illegal or unenforceable to the extent necessary so as to render such provision valid and enforceable as against all persons or entities and to provide the maximum possible protection to the person subject to indemnification hereunder within the bounds of validity, legality and enforceability. Without limiting the generality of the foregoing, if the Indemnitee is entitled to indemnification under this Agreement by the Corporation for some or a portion of the judgments, amounts paid in settlement, attorneys’ fees, ERISA excise taxes or penalties, fines or other expenses actually and reasonably incurred by the Indemnitee in connection with any threatened, pending or completed action, suit or proceeding (including without limitation, the investigation, defense, settlement or appeal of such action, suit or proceeding), whether civil, criminal, administrative, investigative or appellate, but not, however, for all of the total amount thereof, the Corporation shall nevertheless indemnify the Indemnitee for the portion thereof to which such person is entitled.

5

     12. Governing Law. This Agreement shall be governed, interpreted and construed in accordance with the laws of the State of Delaware without regard to any of its conflict of law rules.

     13. Modification; Survival. This Agreement constitutes the entire agreement of the parties relating to the subject matter hereof and no amendment, modification, termination or cancellation of this Agreement shall be effective unless in writing signed by both parties hereto. The provisions of this Agreement shall survive the termination of Indemnitee’s service as a director and/or officer of the Corporation with respect to actions, suits or proceedings brought or instituted in respect of any action taken or the failure to take any action occurring prior to such termination of service.

     IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement and affixed their signatures hereto as of the date first above written.

/s/John C. Danforth  

John C. Danforth, Indemnitee 

CERNER CORPORATION,
a Delaware corporation

      

/s/Marc G. Naughton  

Marc G. Naughton, Chief Financial Officer 

[SEAL]

ATTEST:

/s/Randy D. Sims
Randy D. Sims, Secretary

6

EX-99.2

Exhibit 99.2

CONTACTS:
INVESTORS: Allan Kells, (816) 201-2445
akells@cerner.com

MEDIA: Justin Scott, (816) 201-6438
jscott@cerner.com

CERNER’S INTERNET HOME PAGE:
http://www.cerner.com

CERNER DELIVERS RECORD EARNINGS AND CASH FLOW
New Business Bookings near all-time high

KANSAS CITY, Mo. – Feb. 3, 2005 — Cerner Corporation (NASDAQ:CERN) today announced results for the 2004 fourth quarter ended Jan. 1, 2005, delivering record earnings and cash flow. Diluted earnings per share were $0.56 in the fourth quarter. Analysts’ consensus estimates for fourth quarter earnings per share were $0.54. For the year, diluted earnings per share were $1.72, including a gain on the sale of Zynx Health, Incorporated, in the first quarter that increased earnings per share by $0.05 and an accrued vacation pay adjustment in the third quarter that decreased earnings per share by $0.06. Earnings per share were a record for the quarter and year.

Fourth quarter revenues increased 9 percent to $248.2 million compared to $227.4 million in the year-ago quarter. Full-year 2004 revenues increased 10 percent to $926.4 million compared to $839.6 million in 2003.

Net earnings in the 2004 fourth quarter were $21.4 million, up 32 percent over the fourth quarter of 2003. Net earnings for 2004 were $64.6 million up 51 percent compared to 2003. Net earnings prior to the gain on the sale of Zynx Health and the accrued vacation pay adjustment were $64.9 million in 2004. Net earnings were a record for the quarter and year.

New business bookings revenue in the fourth quarter was $244.8 million, which is up 13 percent over the third quarter of 2004 and is the second highest level of new business bookings in the Company’s history. The highest level was $255 million in the fourth quarter of 2003, which included an unusually large transaction that was in excess of $50 million.

The Company generated record operating cash flow of $55.7 million in the fourth quarter driven by strong cash collections and reflective of continued operational improvements. Full-year 2004 operating cash flow was also a record at $168.3 million.

Other Fourth Quarter and Full-Year 2004 Highlights:

•   Record cash collections of $256.2 million in the fourth quarter and $937.6 million for the year.

•   Days Sales Outstanding (DSOs) of 104 days in the fourth quarter. DSOs for the full-year 2004 were 105 days compared to 110 days in 2003.

•   Operating margin of 14.8 percent for the fourth quarter and 12.0 percent for the full-year. The full-year 2004 operating margin without the impact of the vacation accrual adjustment in the third quarter of 2004 was 12.4 percent and reflects an increase of 310 basis points compared to the 9.3 percent operating margin in 2003.

Page 2

•   Total revenue backlog of $1.54 billion, up 23 percent over the year-ago quarter. This is comprised of $1.19 billion of contract backlog and $347.7 million of support and maintenance backlog.

•   A record of 354 Cerner MillenniumÒ solutions were implemented during the quarter. Cerner has now turned on over 3,700 Cerner Millennium solutions at nearly 750 client facilities worldwide.

•   The number of Cerner client locations using Computerized Physician Order Entry increased from approximately 200 at the end of 2003 to nearly 380 at the end of 2004.

“Our fourth quarter and full-year 2004 results reflect the strongest overall performance in our history,” said Neal Patterson, Cerner’s co-founder, Chairman and Chief Executive Officer. “We generated strong margin expansion and cash flow and demonstrated our superior ability to deliver value to our clients by implementing a record number of Cerner Millennium solutions.”

“We continue to believe that Cerner remains well positioned in the very active healthcare information technology sector,” added Patterson. “We believe Cerner’s single architecture approach and depth and breadth of solutions and services uniquely position us to play a major role in providing a network for healthcare information that connects families, physicians, hospitals, clinics, laboratories and pharmacies across major metropolitan and rural areas. This vision and our abilities align with the Government’s consideration of a national health information network that is needed to reduce costs and improve safety in our healthcare system.”

Future Period Guidance
Cerner expects earnings per share in the first quarter of 2005 to be between $0.41 and $0.42, which is approximately 25 percent over the first quarter of 2004. The Company expects revenue in the first quarter to be approximately $250 million to $255 million.

For 2005, the Company expects earnings per share between $2.07 and $2.12, which is up from the prior range of $2.05 to $2.10. Cerner expects revenue for 2005 to be between $1.08 billion and $1.1 billion, which is up from the prior range of $1.01 billion to $1.03 billion.

Cerner Board Member Announcement
Cerner also announced that former U.S. Senator John C. Danforth has re-joined its Board of Directors, effective today. Senator Danforth brings invaluable experience from his 18 years as a U.S. Senator where he was a long-time member of the Senate Finance Committee. Danforth recently stepped down as U.S. Ambassador to the United Nations, affording him the opportunity to re-join the Cerner Board.

Earnings Conference Call
Cerner will host an earnings conference call to provide additional detail at 3:30 p.m. CT on February 3, 2005. The dial-in number for the call is (617) 786-2903 and the replay number is (617) 801-6888 (Pass code: 90190036). The call will also be Web cast and available both live and archived on Cerner’s Web site at www.cerner.com in the Investors’ section under Presentation and Webcasts. Please access the site fifteen minutes early to register and to download and install any necessary audio software. For those who cannot listen to the live broadcast, replays will be made available shortly after the call and will run for two weeks. A copy of the script used during the call will also be available at www.cerner.com in the Investors’ section under Presentation and Webcasts.

Cerner Corp. is taking the paper chart out of healthcare, eliminating error, variance and waste in the care process. With more than 1,500 clients worldwide, Cerner is the leading supplier of healthcare information technology. The following are trademarks of Cerner: Cerner, Cerner Millennium, and Cerner’s logo. (Nasdaq:CERN), www.cerner.com.

Page 3

This release contains forward-looking statements that involve a number of risks and uncertainties. It is important to note that the Company’s performance, and actual results, financial condition or business could differ materially from those expressed in such forward-looking statements. The words “believe”, “expects”, “guidance”, or variations thereof or similar expressions are intended to identify such forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to: quarterly operating results may vary, stock price may be volatile, market risk of investments, potential impairment of goodwill, changes in the healthcare industry, significant competition, the Company’s proprietary technology may be subjected to infringement claims or may be infringed upon, regulation of the Company’s software by the U.S. Food and Drug Administration or other government regulation, the possibility of product-related liabilities, possible system errors or failures or defects in the performance of the Company’s software, risks associated with the Company’s global operation and the recruitment and retention of key personnel. Additional discussion of these and other factors affecting the Company’s business is contained in the Company’s periodic filings with the Securities and Exchange Commission. The Company undertakes no obligation to update forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes in future operating results, financial condition or business over time.

# # #

Exhibit 99.2 (cont.)

CERNER CORPORATION
CONSOLIDATED STATEMENTS OF EARNINGS

				Note (1) (2)
	Three Months						Three Months
	Ended			YTD			Ended			YTD
(In thousands, except per share data)	January 1, 2005			January 1, 2005			January 3, 2004			January 3, 2004
Revenue
System sales	$	99,614			351,861			90,820			332,349
Support, maintenance and services		141,273			542,414			128,849			476,795
Reimbursed travel		7,285			32,081			7,740			30,443
Total revenue		248,172			926,356			227,409			839,587
Margin
System sales		65,113			236,058			65,372			221,093
Support, maintenance and services		128,961			493,950			114,530			424,204
Total margin		194,074			730,008			179,902			645,297
Operating expenses
Sales and client service		97,635			383,628			93,197			352,728
Software development		43,429			171,589			41,066			156,236
General and administrative		16,321			63,327			16,862			58,236
Total operating expenses		157,385			618,544			151,125			567,200
Operating earnings		36,689			111,464			28,777			78,097
Interest income		1,663			3,022			325			1,219
Interest expense		(2,323	)		(9,174	)		(2,190	)		(8,236	)
Other income, (expense)		(284	)		2,608			(25	)		142
Non-operating expense, net		(944	)		(3,544	)		(1,890	)		(6,875	)
Earnings before income taxes		35,745			107,920			26,887			71,222
Income taxes		(14,319	)		(43,272	)		(10,679	)		(28,431	)
Net earnings	$	21,426			64,648			16,208			42,791
Basic earnings per share	$	0.59			1.79			0.46			1.21
Basic weighted average shares outstanding		36,495			36,087			35,494			35,355
Diluted earnings per share	$	0.56			1.72			0.44			1.18
Diluted weighted average shares outstanding		38,055			37,571			36,935			36,356

Note 1:	Includes a charge for vacation accrual of $3.3 million included in general and adminstrative. The impact of this charge is a $2.1 million decrease, net of $1.2 million tax benefit, in net earnings and a decrease to diluted earnings per share of $.06 for 2004.
Note 2:	Includes a gain on the sale of Zynx Health Incorporated included in other income, (expense). The impact of this gain is a $1.8 million increase, net of $1.2 million tax expense, in net earnings and an increase to diluted earnings per share of $.05 for 2004.

Exhibit 99.2 (cont.)

CERNER CORPORATION
NON-GAAP
CONSOLIDATED STATEMENTS OF EARNINGS

	Three Months						Three Months
	Ended			YTD			Ended			YTD
(In thousands, except per share data)	January 1, 2005			January 1, 2005			January 3, 2004			January 3, 2004
Revenue
System sales	$	99,614			351,861			90,820			332,349
Support, maintenance and services		141,273			542,414			128,849			476,795
Reimbursed travel		7,285			32,081			7,740			30,443
Total revenue		248,172			926,356			227,409			839,587
Margin
System sales		65,113			236,058			65,372			221,093
Support, maintenance and services		128,961			493,950			114,530			424,204
Total margin		194,074			730,008			179,902			645,297
Operating expenses
Sales and client service		97,635			383,628			93,197			352,728
Software development		43,429			171,589			41,066			156,236
General and administrative		16,321			59,981			16,862			58,236
Total operating expenses		157,385			615,198			151,125			567,200
Operating earnings		36,689			114,810			28,777			78,097
Interest income		1,663			3,022			325			1,219
Interest expense		(2,323	)		(9,174	)		(2,190	)		(8,236	)
Other income, (expense)		(284	)		(415	)		(25	)		142
Non-operating expense, net		(944	)		(6,567	)		(1,890	)		(6,875	)
Earnings before income taxes		35,745			108,243			26,887			71,222
Income taxes		(14,319	)		(43,345	)		(10,679	)		(28,431	)
Net earnings	$	21,426			64,898			16,208			42,791
Basic earnings per share	$	0.59			1.80			0.46			1.21
Basic weighted average shares outstanding		36,495			36,087			35,494			35,355
Diluted earnings per share	$	0.56			1.73			0.44			1.18
Diluted weighted average shares outstanding		38,055			37,571			36,935			36,356

RECONCILIATION OF NON-GAAP
TO GAAP CONSOLIDATED STATEMENTS OF OPERATIONS

	Three Months					Three Months
	Ended		YTD			Ended		YTD
(In thousands, except per share data)	January 1, 2005		January 1, 2005			January 3, 2004		January 3, 2004
Non-GAAP net income	$	21,426		64,898			16,208		42,791
Vacation accrual		—		(3,346	)		—		—
Income tax effect		—		1,270			—		—
Gain on sale of Zynx		—		3,023			—		—
Income tax effect		—		(1,197	)		—		—
GAAP net income	$	21,426		64,648			16,208		42,791
Basic earnings per share	$	0.59		1.79			0.46		1.21
Basic weighted average shares outstanding		36,495		36,087			35,494		35,355
Diluted earnings per share	$	0.56		1.72			0.44		1.18
Diluted weighted average shares outstanding		38,055		37,571			36,935		36,356

Exhibit 99.2 (cont.)

CERNER CORPORATION
CONSOLIDATED BALANCE SHEETS

(In thousands)	January 1,			January 3,
	2005			2004
Assets
Cash and cash equivalents	$	189,784			121,839
Receivables, net		282,199			256,574
Inventory		7,373			12,434
Prepaid expenses and other		30,117			33,057
Total current assets		509,473			423,904
Property and equipment, net		230,440			204,953
Software development costs, net		157,765			141,090
Goodwill, net		54,600			51,573
Intangible assets, net		22,690			24,036
Other assets		7,288			8,017
Investments		9			692
Total assets	$	982,265			854,265
Liabilities
Accounts payable	$	37,008			20,753
Current installments of long-term debt		21,908			21,162
Deferred revenue		77,445			64,879
Deferred income taxes		1,301			15,586
Accrued payroll and tax withholdings		55,819			45,004
Other accrued expenses		5,763			10,095
Total current liabilities		199,244			177,479
Long-term debt		108,804			124,570
Deferred income taxes		69,863			54,425
Deferred revenue		5,703			1,945
Total liabilities		383,614			358,419
Minority owners’ equity interest in subsidiary		1,166			1,166
Stockholders’ Equity
Common stock		381			371
Additional paid-in capital		271,116			236,969
Retained earnings		344,011			279,363
Treasury stock, at cost (1,502,999 shares in 2004 and 2003)		(26,793	)		(26,793	)
Foreign currency translation adjustment		8,770			4,770
Total stockholders’ equity		597,485			494,680
Total liabilities and equity	$	982,265			854,265