International Business Machines Corp. (IBM) Tuesday reported a profit and revenues for the second quarter that trumped Wall Street estimates. Moving ahead, the company reiterated its full year outlook.
Armonk, New York-based IBM’s second-quarter profit rose to $2.40 billion or $2.61 per share from $2.33 billion or $2.48 per share last year.
Excluding one-time items, earnings from continuing operations rose to $3.08 per share from $2.94 per share last year. Analysts had a consensus earnings estimate of $3.04 per share for the quarter.
IBM’s second-quarter revenues rose to $20.00 billion from $19.29 billion last year. Analysts polled by Thomson Reuters expected revenues of $19.88 billion for the quarter.
This is the third consecutive quarter the company has reported growth in revenues after reporting revenue declines for nearly five years.
IBM is divesting off its low-margin and unprofitable hardware businesses to improve profitability. The company is now striving hard to make IBM a company that provides cloud computing and data analytics.
Chief Executive Ginni Rometty said, “We delivered strong revenue and profit growth in the quarter, underscoring IBM’s progress and momentum in the emerging, high-value segments of the IT industry. More clients are engaging IBM on their journey to the cloud, and deploying IBM Cloud, Watson AI, analytics, blockchain and security solutions.”
Total cloud revenue over the last 12 months was $18.5 billion, up 23 percent. The annual exit run rate for as-a-service revenue increased to $11.1 billion, up 26 percent.
In the second quarter, revenues from analytics increased 7 percent; revenues from mobile increased 5 percent; and revenues from security increased 81 percent.
Looking forward to 2018, the company continues to expect adjusted earnings of at least $13.80 per share. Analysts currently estimate earnings of $13.78 per share.
IBM closed Wednesday’s trading at $144.52, up $1.01 or 0.70% on the NYSE. The stock further gained $0.83 or 0.44% in the after-hours trading
by RTTNews Staff Writer
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