Continued Strong Growth in Strategic
Imperatives Led by IBM Cloud
Highlights
- Diluted EPS: GAAP of $2.61; Operating
(non-GAAP) of $2.95
- Revenue from continuing operations of
$20.2 billion
- Strategic imperatives revenue of $30.7
billion over the last 12 months represents 38 percent of IBM
revenue- Strategic imperatives revenue of $8.3 billion in the
quarter, up 12 percent year to year
- Cloud revenue of $11.6 billion over the
last 12 months- Cloud as-a-service annual run rate of $6.7 billion
in the quarter, up 50 percent year to year
IBM (NYSE:IBM) today announced second-quarter 2016 earnings
results.
"IBM continues to establish itself as the leading cognitive
solutions and cloud platform company. In doing so, IBM is
pioneering new business opportunities beyond the traditional IT
marketplace," said Ginni Rometty, IBM chairman, president and chief
executive officer. "In the second quarter we delivered double-digit
revenue growth in our strategic imperatives, driven by innovations
in areas such as analytics, security, cloud video services and
Watson Health, all powered by the IBM Cloud and differentiated by
industry. And we continue to invest for growth with recent
breakthroughs in quantum computing, Internet of Things and
Blockchain solutions for the IBM Cloud."
SECOND-QUARTER 2016
Gross Profit Diluted EPS
Net Income Margin GAAP from
Continuing Operations $2.61 $2.5B 47.9%
Year/Year -27% -29%
-2.0Pts
Operating (Non-GAAP) $2.95
$2.8B 49.0% Year/Year -23%
-25% -1.9Pts
Strategic
REVENUE Total IBM
Imperatives Cloud As reported
(US$) $20.2B $8.3B $3.4B Year/Year -3% 12%
30%
“In the first half of 2016, we grew our R&D investment,
closed 11 acquisitions for more than $5 billion and invested nearly
$2 billion in capital expenditures, while returning more than $4
billion to shareholders through dividends and gross share
repurchases,” said Martin Schroeter, IBM senior vice president and
chief financial officer. “These investments are key in helping us
build new markets and maintain our leadership in enterprise
IT.”
Strategic Imperatives
Second-quarter revenues from the company’s strategic imperatives
--- cloud, analytics and engagement --- increased 12 percent year
to year. Cloud revenues (public, private and hybrid) for the
quarter increased 30 percent. Cloud revenue over the trailing 12
months was $11.6 billion. The annual run rate for cloud
as-a-service revenue --- a subset of total cloud revenue ---
increased to $6.7 billion from $4.5 billion in the second quarter
of 2015. Revenues from analytics increased 5 percent (up 4 percent
adjusting for currency). Revenues from mobile increased 43 percent
and from security increased 18 percent.
Full-Year 2016 Expectations
The company continues to expect operating (non-GAAP) diluted
earnings per share of at least $13.50. This excludes $1.27 per
share of charges for amortization of purchased intangible assets,
other acquisition-related charges and retirement-related charges.
As a result, GAAP diluted earnings per share are now expected to be
at least $12.23.
There is no change to IBM's previously provided free cash flow
guidance.
Cash Flow and Balance Sheet
The company generated net cash from operating activities of $3.4
billion; or $3.1 billion excluding Global Financing receivables.
IBM’s free cash flow was $2.1 billion in the second quarter. IBM
returned $1.3 billion in dividends and $0.8 billion of gross share
repurchases to shareholders. At the end of June 2016, IBM had $3.9
billion remaining in the current share repurchase
authorization.
IBM ended the second-quarter 2016 with $10.6 billion of cash on
hand. Debt, including Global Financing debt of $26.5 billion,
totaled $44.5 billion. Core (non-global financing) debt totaled
$18.0 billion. The balance sheet remains strong and is well
positioned to support the business over the long term.
Segment Results
- Cognitive Solutions (includes solutions
software and transaction processing software) -- revenues of $4.7
billion, up 3.5 percent (up 3.8 percent adjusting for currency).
Cloud revenue within the segment grew 54 percent. Solutions
software revenue grew, led by Analytics (including Watson) and
Security.
- Global Business Services (includes
consulting, global process services, application management) --
revenues of $4.3 billion, down 2.0 percent (down 2.5 percent
adjusting for currency). Strategic imperatives revenue within the
segment was up 14 percent (up 13 percent adjusting for
currency).
- Technology Services & Cloud
Platforms (includes infrastructure services, technical support
services, integration software) -- revenues of $8.9 billion, down
0.5 percent (flat adjusting for currency). Growth of 35 percent in
strategic imperatives revenue within the segment was driven by
strong hybrid cloud infrastructure services performance.
- Systems (includes systems hardware and
operating systems software) -- revenues of $2.0 billion, down 23.2
percent (down 23.3 percent adjusting for currency). Revenue
reflects z Systems product cycle dynamics; gross profit margin
improved in both z Systems and Power.
- Global Financing (includes financing
and used equipment sales) -- revenues of $424 million, down 11.3
percent (down 10.0 percent adjusting for currency).
Year-To-Date 2016 Results
Diluted earnings per share from continuing operations were
$4.69, down 22 percent compared to the 2015 period. Net income from
continuing operations for the six months ended June 30, 2016 was
$4.5 billion compared with $5.9 billion in the year-ago period, a
decrease of 24 percent.
Consolidated net income was $4.5 billion compared to $5.8
billion in the year-ago period. Consolidated diluted earnings per
share were $4.69 compared to $5.84, down 20 percent year to year.
Revenues from continuing operations for the six-month period
totaled $38.9 billion, a decrease of 4 percent (down 2 percent year
to year, adjusting for currency) compared with $40.4 billion for
the first six months of 2015.
Operating (non-GAAP) diluted earnings per share from continuing
operations were $5.30 compared with $6.75 per diluted share for the
2015 period, a decrease of 21 percent. Operating (non-GAAP) net
income from continuing operations for the six months ended June 30,
2016 was $5.1 billion compared with $6.7 billion in the year-ago
period, a decrease of 24 percent.
Forward-Looking and Cautionary Statements
Except for the historical information and discussions contained
herein, statements contained in this release may constitute
forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. Forward-looking
statements are based on the company’s current assumptions regarding
future business and financial performance. These statements involve
a number of risks, uncertainties and other factors that could cause
actual results to differ materially, including the following: a
downturn in economic environment and client spending budgets; the
company’s failure to meet growth and productivity objectives, a
failure of the company’s innovation initiatives; risks from
investing in growth opportunities; failure of the company’s
intellectual property portfolio to prevent competitive offerings
and the failure of the company to obtain necessary licenses;
cybersecurity and data privacy considerations; fluctuations in
financial results, impact of local legal, economic, political and
health conditions; adverse effects from environmental matters, tax
matters and the company’s pension plans; ineffective internal
controls; the company’s use of accounting estimates; the company’s
ability to attract and retain key personnel and its reliance on
critical skills; impacts of relationships with critical suppliers;
product quality issues; impacts of business with government
clients; currency fluctuations and customer financing risks; impact
of changes in market liquidity conditions and customer credit risk
on receivables; reliance on third party distribution channels and
ecosystems; the company’s ability to successfully manage
acquisitions, alliances and dispositions; risks from legal
proceedings; risk factors related to IBM securities; and other
risks, uncertainties and factors discussed in the company’s
Form 10-Qs, Form 10-K and in the company’s other filings
with the U.S. Securities and Exchange Commission (SEC) or in
materials incorporated therein by reference. Any forward-looking
statement in this release speaks only as of the date on which it is
made. The company assumes no obligation to update or revise any
forward-looking statements.
Presentation of Information in this Press Release
In an effort to provide investors with additional information
regarding the company’s results as determined by generally accepted
accounting principles (GAAP), the company has also disclosed in
this press release the following non-GAAP information which
management believes provides useful information to investors:
IBM results --
- presenting operating (non-GAAP)
earnings per share amounts and related income statement items;
- adjusting for free cash flow;
- adjusting for currency (i.e., at
constant currency).
Free cash flow guidance is derived using an estimate of profit,
working capital and operational cash outflows. The company views
Global Financing receivables as a profit-generating investment,
which it seeks to maximize and therefore it is not considered when
formulating guidance for free cash flow. As a result, the company
does not estimate a GAAP Net Cash from Operations expectation
metric.
The rationale for management’s use of these non-GAAP measures is
included in Exhibit 99.2 in the Form 8-K that includes this press
release and is being submitted today to the SEC.
Conference Call and Webcast
IBM’s regular quarterly earnings conference call is scheduled to
begin at 5:00 p.m. EDT, today. The Webcast may be accessed via
a link at http://www.ibm.com/investor/events/earnings/2q16.html.
Presentation charts will be available shortly before the
Webcast.
Financial Results Below (certain amounts may not add due
to use of rounded numbers; percentages presented are calculated
from the underlying whole-dollar amounts).
INTERNATIONAL BUSINESS MACHINES CORPORATION COMPARATIVE
FINANCIAL RESULTS (Unaudited; Dollars in millions except per
share amounts) Three Months Ended
Six Months Ended June 30, June 30,
2016 2015* 2016
2015* REVENUE Cognitive Solutions $4,675
$4,516 $8,654 $8,564 Global Business Services 4,255 4,345 8,387
8,663 Technology Services & Cloud Platforms 8,857 8,898 17,280
17,452 Systems 1,950 2,541 3,626 4,683 Global Financing 424 478 834
939 Other 76 35 142 102
TOTAL REVENUE 20,238
20,813 38,923 40,403
GROSS PROFIT 9,702 10,390 18,388
19,842
GROSS PROFIT MARGIN Cognitive Solutions 82.2%
85.7% 82.1% 85.1% Global Business Services 26.3% 27.4% 26.1% 27.4%
Technology Services & Cloud Platforms 41.6% 42.2% 41.3% 42.1%
Systems 56.5% 56.5% 56.9% 55.7% Global Financing 38.7% 44.7% 40.5%
47.1%
TOTAL GROSS PROFIT MARGIN 47.9% 49.9% 47.2%
49.1%
EXPENSE AND OTHER INCOME S,G&A 5,349
5,179 11,361 10,541 R,D&E 1,465 1,300 2,923 2,598
Intellectual property and custom development income (365) (128)
(582) (301) Other (income) and expense 37 (301) 289 (444)
Interest expense 167 115 315 223
TOTAL EXPENSE AND OTHER INCOME 6,653 6,165
14,306 12,617
INCOME FROM CONTINUING OPERATIONS
BEFORE INCOME TAXES 3,049 4,224 4,082 7,225 Pre-tax margin
15.1% 20.3% 10.5% 17.9% Provision for / (Benefit) from
income taxes 544 698 (439) 1,283 Effective tax rate 17.8% 16.5%
(10.8%) 17.8%
INCOME FROM CONTINUING OPERATIONS
$2,505 $3,526 $4,521 $5,942
DISCONTINUED OPERATIONS
Loss from discontinued operations, net of taxes 0 (77) (3)
(165)
NET INCOME $2,504 $3,449 $4,518
$5,777
EARNINGS PER SHARE OF COMMON
STOCK: Assuming Dilution Continuing Operations $2.61 $3.58
$4.69 $6.01 Discontinued Operations $0.00 ($0.08) $0.00
($0.17) TOTAL $2.61 $3.50 $4.69 $5.84
Basic Continuing Operations $2.62 $3.59 $4.71 $6.03 Discontinued
Operations $0.00 ($0.08) $0.00 ($0.17) TOTAL $2.62
$3.51 $4.71 $5.86
WEIGHTED-AVERAGE NUMBER
OF COMMON SHARES OUTSTANDING (M's): Assuming Dilution
960.5 986.7 962.4 989.5 Basic 957.4 982.3 959.5 985.2
*Recast to conform with 2016 segment presentation.
INTERNATIONAL BUSINESS MACHINES CORPORATION CONDENSED
CONSOLIDATED BALANCE SHEET (Unaudited)
At At (Dollars in Millions) June
30, December 31, 2016 2015 ASSETS:
Current Assets: Cash and cash equivalents
$10,017 $7,686 Marketable securities 600 508 Notes and accounts
receivable - trade, net 8,782 8,333 Short-term financing
receivables, net 16,635 19,020 Other accounts receivable, net 1,130
1,201 Inventory 1,685 1,551 Prepaid expenses and other current
assets 4,676 4,205
Total Current Assets
43,524 42,504 Property, plant and equipment,
net 11,092 10,727 Long-term financing receivables, net 9,267 10,013
Prepaid pension assets 2,957 1,734 Deferred taxes 4,387 4,822
Goodwill and intangibles, net 41,570 35,508 Investments and sundry
assets 5,259 5,187
Total Assets
$118,056 $110,495 LIABILITIES:
Current Liabilities: Taxes $2,275 $2,847 Short-term
debt 4,887 6,461 Accounts payable 5,484 6,028 Deferred income
11,508 11,021 Other liabilities 9,430 7,913
Total Current Liabilities 33,585 34,269
Long-term debt 39,638 33,428 Retirement related obligations 16,723
16,504 Deferred income 3,837 3,771 Other liabilities 8,385 8,099
Total Liabilities 102,167
96,071 EQUITY: IBM
Stockholders' Equity: Common stock 53,565 53,262 Retained
earnings 148,071 146,124 Treasury stock -- at cost (157,298)
(155,518) Accumulated other comprehensive income/(loss) (28,604)
(29,607)
Total IBM stockholders' equity
15,733 14,262 Noncontrolling interests 156 162
Total Equity 15,889
14,424 Total Liabilities and
Equity $118,056 $110,495
INTERNATIONAL BUSINESS MACHINES CORPORATION CASH FLOW
ANALYSIS (Unaudited) Three Months
Ended Six Months Ended (Dollars in
Millions) June 30 June 30
2016 2015 2016 2015 Net Cash
Provided by Operating Activities per GAAP: $3,443
$3,884 $9,088 $7,494 Less: change in
Global Financing (GF) Receivables 334 (392) 2,713 1,214 Capital
Expenditures, Net (979) (906) (1,949) (1,830)
Free Cash
Flow 2,130 3,369 4,426 4,450
Acquisitions (2,815) (560) (5,405) (708) Divestitures (12) 61 35 81
Dividends (1,340) (1,278) (2,590) (2,366) Share Repurchase (836)
(1,138) (1,775) (2,303) Non-GF Debt (810) 30 5,061 391 Other
(includes GF Receivables, and GF Debt) (570) (528) 2,670 739
Change in Cash, Cash Equivalents and Short-term
Marketable Securities ($4,253) ($43)
$2,421 $284 INTERNATIONAL BUSINESS MACHINES
CORPORATION CASH FLOW (Unaudited)
Three Months Ended Six Months Ended
(Dollars in Millions) June 30 June 30
2016 2015 2016 2015
Net Income from Operations $2,504 $3,449
$4,518 $5,777 Depreciation/Amortization of
Intangibles 1,103 961 2,127 1,930 Stock-based Compensation 128 131
261 257 Working Capital / Other (626) (302) (531) (1,721) Global
Financing A/R 334 (392) 2,713 1,214 Loss on Microelectronics
Business Disposal 0 37 0 37
Net Cash Provided by Operating
Activities $3,443 $3,884 $9,088
$7,494 Capital Expenditures, net of payments & proceeds
(979) (906) (1,949) (1,830) Divestitures, net of cash transferred
(12) 61 35 81 Acquisitions, net of cash acquired (2,815) (560)
(5,405) (708) Marketable Securities / Other Investments, net (717)
(526) 769 1,086
Net Cash Used in Investing Activities
($4,522) ($1,931) ($6,550) ($1,371)
Debt, net of payments & proceeds (1,035) (212) 3,929 (1,522)
Dividends (1,340) (1,278) (2,590) (2,366) Common Stock Repurchases
(836) (1,138) (1,775) (2,303) Common Stock Transactions - Other 55
59 115 221
Net Cash Used in Financing Activities
($3,156) ($2,568) ($322) ($5,970)
Effect of Exchange Rate changes on Cash
(103) 213
114 (236) Net Change in Cash & Cash
Equivalents ($4,338) ($402) $2,330
($83) INTERNATIONAL BUSINESS MACHINES
CORPORATION SEGMENT DATA (Unaudited)
SECOND - QUARTER 2016 Cognitive Solutions
& Industry Services
Technology Global Services & (Dollars
in Millions) Cognitive Business Cloud
Global Solutions Services
Platforms Systems Financing
Revenue External $4,675 $4,255 $8,857 $1,950 $424 Internal
594 103 156 206 502
Total Segment
Revenue $5,269 $4,359 $9,013 $2,156 $926
Pre-tax
Income / (Loss) from Continuing Operations 1,451 476 1,279 229
467
Pre-tax margin 27.5% 10.9% 14.2% 10.6% 50.5%
Change YTY Revenue - External 3.5%
(2.0)% (0.5)% (23.2)% (11.3)% Change
YTY Revenue - External @constant currency 3.8%
(2.5)% 0.0% (23.3)% (10.0)%
SECOND - QUARTER 2015* Cognitive Solutions
& Industry Services Technology Global
Services & (Dollars in Millions) Cognitive
Business Cloud Global Solutions
Services Platforms Systems
Financing Revenue External $4,516 $4,345
$8,898 $2,541 $478 Internal 532 130 173 189
704
Total Segment Revenue $5,049 $4,475 $9,071 $2,730
$1,182
Pre-tax Income / (Loss) from Continuing
Operations 1,825 643 1,414 538 613
Pre-tax margin
36.1% 14.4% 15.6% 19.7% 51.9%
*Recast to conform with
2016 segment presentation. INTERNATIONAL BUSINESS
MACHINES CORPORATION SEGMENT DATA (Unaudited)
SIX - MONTHS 2016 Cognitive Solutions
& Industry Services
Technology Global Services & (Dollars
in Millions) Cognitive Business Cloud
Global Solutions Services
Platforms Systems Financing
Revenue External $8,654 $8,387 $17,280 $3,626 $834 Internal
1,262 216 321 418 988
Total Segment
Revenue $9,916 $8,603 $17,602 $4,044 $1,822
Pre-tax
Income / (Loss) from Continuing Operations 2,465 665 1,537 218
853
Pre-tax margin 24.9% 7.7% 8.7% 5.4% 46.8%
Change YTY Revenue - External 1.1%
(3.2)% (1.0)% (22.6)% (11.2)% Change
YTY Revenue - External @constant currency 2.2%
(2.4)% 0.9% (22.1)% (8.2)%
SIX - MONTHS 2015* Cognitive Solutions &
Industry Services Technology Global
Services & (Dollars in Millions) Cognitive
Business Cloud Global Solutions
Services Platforms Systems
Financing Revenue External $8,564 $8,663
$17,452 $4,683 $939 Internal 1,167 261 339 362
1,290
Total Segment Revenue $9,731 $8,923 $17,791
$5,044 $2,229
Pre-tax Income / (Loss) from Continuing
Operations 3,353 1,231 2,544 800 1,128
Pre-tax
margin 34.5% 13.8% 14.3% 15.9% 50.6%
*Recast to
conform with 2016 segment presentation. INTERNATIONAL
BUSINESS MACHINES CORPORATION U.S. GAAP TO OPERATING
(Non-GAAP) RESULTS RECONCILIATION (Unaudited; Dollars in
millions except per share amounts) SECOND - QUARTER
2016 CONTINUING OPERATIONS Acquisition-
Retirement- Related Related
Operating GAAP Adjustments*
Adjustments** (Non-GAAP) Gross
Profit $9,702 $129 $81 $9,912
Gross Profit Margin
47.9% 0.6Pts 0.4Pts 49.0%
S,G&A 5,349 (159) (75)
5,114
R,D&E 1,465 - (7) 1,458
Other
(Income) & Expense 37 - - 37
Total Expense &
Other (Income) 6,653 (159) (83) 6,411
Pre-tax Income
from Continuing Operations 3,049 289 163 3,501
Pre-tax Income Margin from Continuing Operations 15.1%
1.4Pts 0.8Pts 17.3%
Provision for Income Taxes*** 544
82 39 665
Effective Tax Rate 17.8% 0.9Pts 0.3Pts
19.0%
Income from Continuing Operations 2,505 207 124
2,835
Income Margin from Continuing Operations 12.4%
1.0Pts 0.6Pts 14.0%
Diluted Earnings Per Share:
Continuing Operations $2.61 $0.21 $0.13 $2.95
SECOND
- QUARTER 2015 CONTINUING OPERATIONS Acquisition-
Retirement- Related Related Operating
GAAP Adjustments* Adjustments**
(Non-GAAP) Gross Profit $10,390 $88
$112 $10,590
Gross Profit Margin 49.9% 0.4Pts 0.5Pts
50.9%
S,G&A 5,179 (74) (63) 5,042
R,D&E 1,300 - (11) 1,289
Other (Income) &
Expense (301) (5) - (306)
Total Expense & Other
(Income) 6,165 (80) (74) 6,012
Pre-tax Income from
Continuing Operations 4,224 168 186 4,578
Pre-tax
Income Margin from Continuing Operations 20.3% 0.8Pts 0.9Pts
22.0%
Provision for Income Taxes*** 698 28 61 788
Effective Tax Rate 16.5% 0.0Pts 0.7Pts 17.2%
Income from Continuing Operations 3,526 140 124 3,790
Income Margin from Continuing Operations 16.9% 0.7Pts 0.6Pts
18.2%
Diluted Earnings Per Share: Continuing
Operations $3.58 $0.14 $0.12 $3.84
*
Includes amortization of purchased
intangible assets, in process R&D, severance cost for acquired
employees, vacant space for acquired companies, deal costs and
acquisition integration tax charges.
**
Includes retirement-related interest
cost, expected return on plan assets, recognized actuarial losses
or gains, amortization of transition assets, other settlements,
curtailments, multi-employer plans and insolvency
insurance.
***
Tax impact on operating (non-GAAP)
pre-tax income from continuing operations is calculated under the
same accounting principles applied to the As Reported pre-tax
income under ASC 740, which employs an annual effective tax rate
method to the results.
INTERNATIONAL BUSINESS MACHINES CORPORATION U.S.
GAAP TO OPERATING (Non-GAAP) RESULTS RECONCILIATION
(Unaudited; Dollars in millions except per share amounts)
SIX - MONTHS 2016 CONTINUING OPERATIONS
Acquisition- Retirement-
Related Related Operating GAAP
Adjustments* Adjustments**
(Non-GAAP) Gross Profit $18,388 $241 $160
$18,789
Gross Profit Margin 47.2% 0.6Pts 0.4Pts 48.3%
S,G&A 11,361 (227) (130) 11,004
R,D&E 2,923 - (16) 2,907
Other (Income) &
Expense 289 (6) - 284
Total Expense & Other
(Income) 14,306 (232) (146) 13,928
Pre-tax Income
from Continuing Operations 4,082 473 306 4,861
Pre-tax Income Margin from Continuing Operations 10.5%
1.2Pts 0.8Pts 12.5%
Provision for / (Benefit) from Income
Taxes*** (439) 129 66 (244)
Effective Tax Rate
(10.8)% 3.9Pts 2.3Pts (5.0)%
Income from Continuing
Operations 4,521 345 239 5,105
Income Margin from
Continuing Operations 11.6% 0.9Pts 0.6Pts 13.1%
Diluted Earnings Per Share: Continuing Operations $4.69
$0.36 $0.25 $5.30
SIX - MONTHS 2015
CONTINUING OPERATIONS Acquisition- Retirement-
Related Related Operating GAAP
Adjustments* Adjustments**
(Non-GAAP) Gross Profit $19,842 $179 $233
$20,253
Gross Profit Margin 49.1% 0.4Pts 0.6Pts 50.1%
S,G&A 10,541 (154) (371) 10,017
R,D&E 2,598 - (24) 2,574
Other (Income) &
Expense (444) (5) - (450)
Total Expense & Other
(Income) 12,617 (159) (395) 12,063
Pre-Tax Income
from Continuing Operations 7,225 338 627 8,190
Pre-tax Income Margin from Continuing Operations 17.9%
0.8Pts 1.6Pts 20.3%
Provision for Income Taxes***
1,283 56 170 1,510
Effective Tax Rate 17.8% 0.0Pts
0.7Pts 18.4%
Income from Continuing Operations 5,942
281 457 6,680
Income Margin from Continuing
Operations 14.7% 0.7Pts 1.1Pts 16.5%
Diluted Earnings
Per Share: Continuing Operations $6.01 $0.28 $0.46 $6.75
*
Includes amortization of purchased
intangible assets, in process R&D, severance cost for acquired
employees, vacant space for acquired companies, deal costs and
acquisition integration tax charges.
**
Includes retirement-related interest
cost, expected return on plan assets, recognized actuarial losses
or gains, amortization of transition assets, other settlements,
curtailments, multi-employer plans and insolvency
insurance.
***
Tax impact on operating (non-GAAP)
pre-tax income from continuing operations is calculated under the
same accounting principles applied to the As Reported pre-tax
income under ASC 740, which employs an annual effective tax rate
method to the results.
INTERNATIONAL BUSINESS MACHINES CORPORATION
RECONCILIATION OF OPERATING EARNINGS PER SHARE
2016
EPS
Guidance
Expectations
IBM GAAP EPS at least $12.23 IBM Operating EPS
(non-GAAP) at least $13.50 Adjustments
Acquisition related charges * $0.84 Non-Operating
Retirement-Related Items $0.43 * Includes acquisitions
through June 30, 2016
View source
version on businesswire.com: http://www.businesswire.com/news/home/20160718006295/en/
IBMIan Colley, 914-434-3043colley@us.ibm.comorJohn Bukovinsky,
732-618-3531jbuko@us.ibm.com
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