Here’s how the company did it:
- Gains: $ 2.33 per share, adjusted, compared to $ 2.29 per share as expected by analysts, according to Refinitiv.
- Returned: $ 18.75 billion, compared to $ 18.29 billion as expected by analysts, according to Refinitiv.
Revenue grew 3% year-over-year in the quarter, according to a statement, the fastest growth in three years, as the company wraps up a quarter that saw a significant impact from the coronavirus. In the previous quarter, sales increased by 0.9%. The company reiterated its expectations that revenues will increase rather than decrease throughout the year.
“The overall spending environment continues to improve,” CEO Arvind Krishna said on a conference call with analysts. “With the reopening of the economy in many parts of the world, many markets and industries are getting back on track. We see it in North America and in some industries. “
IBM’s Global Technology Services segment, which includes managed services, outsourcing and support, generated revenue of $ 6.34 billion. It was up slightly and above the consensus of $ 6.23 billion among analysts polled by FactSet. IBM continues to expect to launch the Managed Infrastructure Services component of Global Technology Services, under the Kyndryl name, by the end of the year.
“While our performance with existing customers remains strong, as we expected, the sales cycles of new Logo customers are lengthening as they await further information on Kyndryl,” said Jim Kavanaugh, CFO from IBM.
The Cloud & Cognitive Software business, which includes Red Hat, generated revenue of $ 6.10 billion, up 6% and more than the FactSet consensus of $ 5.93 billion.
The company’s Global Business Services consulting unit reported revenue of $ 4.34 billion, growing nearly 12% and above the FactSet consensus of $ 4.03 billion.
“Customers are accelerating the pace and pace of their digital transformations by using the cloud and AI to gain operational insights, increase productivity and create new growth opportunities,” said Kavanaugh. The company has invested in building the skills of competing cloud providers, such as Amazon Web Services and Microsoft Azure, he said.
Systems revenue, including hardware, was $ 1.71 billion, down 7%, according to consensus.
During the quarter, IBM spent $ 1.75 billion on acquisitions, the highest amount in a single quarter since closing the $ 34 billion deal with Red Hat in the third quarter of 2019. It announced the ‘acquisition of process extraction software company myInvenio, application management company Turbonomic and sales force consulting company Waeg. The company also announced 2-nanometer chip technology, as well as new artificial intelligence features for its Watson Studio software for building models.
Excluding after-hours movement, IBM stocks are up 9% year-to-date, while the S&P 500 index is up nearly 13% over the same period.
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