IBM Reports Loss but Higher Revenue
April 17 2018 - 4:49PM
Dow Jones News
By Ted Greenwald and Maria Armental
International Business Machines Corp. reported its second
consecutive quarter of higher revenue after nearly six years of
declines, a sign that Chief Executive Ginni Rometty's slow-moving
turnaround may be taking hold.
Revenue in the latest period rose 5% from a year ago to $19.07
billion. Profit fell 4% to $1.68 billion, as gross profit margin
narrowed from the previous quarter.
The tech giant's shares fell 4.3% to $154.11 in after-hours
trading Tuesday, after closing up 1.9%. The stock has lost 6% in
the past 12 months, even as the S&P 500 index has risen
15%.
Ms. Rometty has been working to turn around IBM almost since the
moment she took over from Sam Palmisano in 2012, as the emerging
industry of cloud computing ate away at IBM's business of managing
information technology in customers' facilities.
She has refashioned IBM as a cloud provider, seeking to
differentiate the company's offerings from lower-cost competitors
through buzzy technologies such as its artificial-intelligence
tools and blockchain, a decentralized way to execute and track
transactions.
IBM expects these offerings, which it calls strategic
imperatives, to grow more rapidly than its legacy businesses are
shrinking, propelling IBM to faster revenue growth as they come to
constitute a bigger portion of overall sales.
The company said strategic-imperatives revenue reached $37.7
billion, making up 47% of revenue over the last 12 months, and
remains on track to reach $40 billion by the end of the year.
"The overarching message," said IBM finance chief James
Kavanaugh, "is that we grew revenue, stabilized our gross margin
across all our lines of business and grew operating profit, cash,
and earnings per share. So a good start to the year, overall."
(END) Dow Jones Newswires
April 17, 2018 16:34 ET (20:34 GMT)
Copyright (c) 2018 Dow Jones & Company, Inc.
International Business M... (NYSE:IBM)
Historical Stock Chart
From Mar 2024 to Apr 2024
International Business M... (NYSE:IBM)
Historical Stock Chart
From Apr 2023 to Apr 2024