IBM Posts Fourth-quarter Results
International Business Machines (IBM) reported quarterly revenue that was lower than expected, as demand for its servers and storage products remains low.
The company's total revenue fell nearly 12 percent to $24.11 billion in the fourth quarter ended Dec. 31. Revenue from hardware fell 39 percent to $2.41 billion.
Net income fell to $5.48 billion, or $5.51 per share, from $6.19 billion, or $5.73 per share, a year earlier.
On an adjusted basis, the company earned $5.81 per share.
IBM forecast 2015 operating earnings of $15.75 to $16.50 per share.
The company has been divesting its businesses in an attempt to realign itself with the sector's shift to higher-margin businesses, such as security software and cloud services.
"We are making significant progress in our transformation, continuing to shift IBM?s business to higher value, and investing and positioning ourselves for the longer term," said Ginni Rometty, IBM chairman, president and chief executive officer.
"In 2014, we repositioned our hardware portfolio for higher value, maintained a services backlog of $128 billion and achieved strong revenue growth across cloud, analytics, mobile, social and security. Together these strategic imperatives grew 16 percent in 2014 and now represent $25 billion and 27 percent of our revenue."
IBM's Global Services segment revenues decreased 8 percent. Revenues from the Software segment were $7.6 billion, down 7 percent (down 3 percent, adjusting for currency) compared with the fourth-quarter of 2013.
Revenues from IBM's key middleware products, which include WebSphere, Information Management, Tivoli, Workforce Solutions and Rational products, were $5.4 billion, down 6 percent (down 3 percent, adjusting for currency) versus the fourth-quarter of 2013. Operating systems revenues of $557 million were down 19 percent (down 16 percent, adjusting for currency) compared with the prior-year quarter.
IBM's Global Financing segment revenues were flat (up 5 percent, adjusting for currency) in the fourth-quarter to $532 million.
Revenues from continuing operations for the Systems and Technology segment (hardware) totaled $2.4 billion for the quarter, down 39 percent (down 12 percent, adjusting for the impact of the divested System x business and currency) from the fourth-quarter of 2013.
Revenues from Power Systems were down 13 percent (down 11 percent, adjusting for currency) compared with the 2013 period.
Net income fell to $5.48 billion, or $5.51 per share, from $6.19 billion, or $5.73 per share, a year earlier.
On an adjusted basis, the company earned $5.81 per share.
IBM forecast 2015 operating earnings of $15.75 to $16.50 per share.
The company has been divesting its businesses in an attempt to realign itself with the sector's shift to higher-margin businesses, such as security software and cloud services.
"We are making significant progress in our transformation, continuing to shift IBM?s business to higher value, and investing and positioning ourselves for the longer term," said Ginni Rometty, IBM chairman, president and chief executive officer.
"In 2014, we repositioned our hardware portfolio for higher value, maintained a services backlog of $128 billion and achieved strong revenue growth across cloud, analytics, mobile, social and security. Together these strategic imperatives grew 16 percent in 2014 and now represent $25 billion and 27 percent of our revenue."
IBM's Global Services segment revenues decreased 8 percent. Revenues from the Software segment were $7.6 billion, down 7 percent (down 3 percent, adjusting for currency) compared with the fourth-quarter of 2013.
Revenues from IBM's key middleware products, which include WebSphere, Information Management, Tivoli, Workforce Solutions and Rational products, were $5.4 billion, down 6 percent (down 3 percent, adjusting for currency) versus the fourth-quarter of 2013. Operating systems revenues of $557 million were down 19 percent (down 16 percent, adjusting for currency) compared with the prior-year quarter.
IBM's Global Financing segment revenues were flat (up 5 percent, adjusting for currency) in the fourth-quarter to $532 million.
Revenues from continuing operations for the Systems and Technology segment (hardware) totaled $2.4 billion for the quarter, down 39 percent (down 12 percent, adjusting for the impact of the divested System x business and currency) from the fourth-quarter of 2013.
Revenues from Power Systems were down 13 percent (down 11 percent, adjusting for currency) compared with the 2013 period.
