Summary
- IBM continues to drive growth by leveraging its AI platform Watson.
- Earlier this month, IBM introduced a new integrated supply chain suite that has been embedded with Watson AI and IBM Blockchain.
- Within healthcare, IBM recently announced a tie-up with Guerbet, a global specialist in contrast agents and solutions for diagnostic and interventional medical imaging.
Earlier this week, IBM (NYSE:IBM) declared its third quarter results that exceeded earnings expectations despite missing revenue estimates. The stock fell nearly 5% post the result announcement in the after-hours session.
IBM's Financials
Revenues for the third quarter fell 3.9% over the year to $18.03 billion, missing the Street's forecast of $18.23 billion for the quarter. This was the fifth straight quarter when revenue for the company declined. Net income for the year came in at $1.7 billion, or $1.87 per share, compared with previous year's net income of $2.69 billion, or $2.94 a share. Adjusted net income for the quarter was $2.68 per share compared with the market's expectations of $2.66 per share.
By segment, Cloud & Cognitive Software revenue that includes Red Hat grew 6% over the year to $5.3 billion, driven by growth in security, IoT, data and AI platforms, and hybrid cloud revenues. Revenues from Red Hat grew 19% to $371 million. On a trailing 12-month basis, cloud revenues came in at $20 billion with the third quarter accounting for $5 billion.
Revenue from the Global Business Services segment grew 1% to $4.1 billion. Global Technology Services revenues fell 6% to $6.7 billion. Revenues from the Systems segment fell 15% to $1.5 billion, Global Financing fell 12% to $343 million, and Other segment was down 78% to $107 million.
IBM expects to end the year with GAAP diluted earnings per share of at least $12.80, in line with the market's estimates for the year.
