IBM shares rose 3% in extended trading on Monday after the enterprise technology and services provider reported second-quarter earnings that came in stronger than analysts had expected.
Here’s how the company did:
- Earnings: $2.33 per share, adjusted, vs. $2.29 per share as expected by analysts, according to Refinitiv.
- Revenue: $18.75 billion, vs. $18.29 billion as expected by analysts, according to Refinitiv.
Revenue grew 3% year over year in the quarter, according to a statement, the fastest growth in three years, as the company laps a quarter that saw meaningful impact from the coronavirus. In the previous quarter revenue had grown 0.9%. The company reiterated its expectation that revenue will grow, rather than decline, in the full year.
IBM’s Global Technology Services segment, containing managed services, outsourcing and support, delivered $6.34 billion in revenue. That was up slightly and above the $6.23 billion consensus among analysts polled by FactSet.
The Cloud & Cognitive Software business, which includes Red Hat, contributed $6.10 billion in revenue, up 6% and more than the FactSet consensus of $5.93 billion.
The company’s Global Business Services consulting unit had $4.34 billion in revenue, growing almost 12% and higher than the $4.03 billion FactSet consensus.
Systems revenue, including hardware, came out to $1.71 billion, which was down 7%, meeting consensus.
In the quarter IBM said it was acquiring process-mining software company myInvenio, application-management company Turbonomic and Salesforce consulting company Waeg. The company also announced 2-nanometer chip technology, as well as new artificial-intelligence features for its Watson Studio software for building models.
Excluding the after-hours move, IBM shares are up 9% since the start of the year, while the S&P 500 index is up almost 13% over the same period.
Executives will discuss the results on a conference call with analysts starting at 5 p.m. Eastern time.
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