International Business Machine ends revenue losing streak despite stocks downfall

IBM finally ended its 22 quarters of revenue declines in the fourth quarter of 2017. The technology firm reported revenue of $22.5 billion in that period, a 4 percent rise on a yearly basis.

Big Blue’s achievement surpassed analysts’ estimate of $ 22.1 billion. Also, IBM ’s earning per share reached $5.18, topping the initial forecast of $5.17 presented by analysts, according to Reuters report.

However, such good news didn’t affect the company’s shares as the stock dropped to more than 4.5 percent at $169.12 per share.

Newer business segment contributes to last year’s final quarter growth

IBM ’s robust financial achievement cannot be separated from the increase in more modern business line or known as the strategic imperative which includes data analytics, cloud computing, and mobile and social and security services.

This sector contributed $11.1 billion to the company’s revenue, a 17 percent increase compared to the same period in the previous year. Still, analysts thought that the figure should have been higher than that.

In cloud sector, IBM has invested in more than 60 data centres in 19 countries in the past three years.

IBM and Danish shipping firm signed an agreement to form a joint venture to apply blockchain technology to boost efficiency and safety in global trade, as Maersk’s official statement said on Tuesday.

Older technology still rules

Despite the growth in newer technology, it was Big Blue’s mainstream System business that drove Thursday’s robust revenue, with a 32 percent surge in sales. On the other hand, revenue from cognitive solutions, including artificial-intelligence services such as Watson Health and Watson Financial only rose 3 percent.

IBM set a realistic target for earning per share of $13.80, a slightly higher than that of 2017. The company didn’t elaborate more detail about the growth, only saying that earning will continue to grow at a slower pace.

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ValueSpectrum.com News Wire & Equity Research: +31 084-0032-842
news@valuespectrum.com

Copyright analist.nl B.V.
All rights reserved. Any redistribution, duplication or archiving prohibited. analist.nl doesn't warrant the accuracy of any News Content provided and shall not be liable for any errors, inaccuracies or for any actions taken in reliance thereon.