IBM Delivers on Earnings and Maintains Long-Term Goals

IBM logoInternational Business Machines Corp. (NYSE: IBM) has reported earnings for its fourth quarter of $5.39 per share before items and $29.3 billion in revenue. Sales were down 1% from a year ago but are said to be flat if adjusted for currency. Thomson Reuters had consensus estimates of $5.25 EPS and $29.09 billion in revenue. Gross margin came in up 1.8 points at 51.8%.

IBM's guidance is for earnings of at least $16.70 per share in 2013, but we have the Thomson Reuters consensus at $16.63 EPS. IBM said its free cash flow was $9.5 billion, up $0.6 billion from a year ago.

As a reminder, IBM is the largest DJIA component by far, so if its gains hold up then the DJIA should have a handy jump on a static basis for Wednesday morning. Other key points are as follows:

  • Software revenue up 3%, up 4% adjusting for currency.
  • Services revenue down 2%, down 1% adjusting for currency.
  • Systems and Technology revenue down 1%, up 4% excluding RSS: System z mainframe up 56 percent.
  • Services backlog was flat at $140 billion, but that would have been up $1 billion adjusting for currency.
  • Fourth-quarter revenues in the Americas unit were flat at $12.5 billion, but they were up 1% if adjusting for currency from the 2011 period.
  • Revenue from the "growth markets" rose 7%. Revenues in the BRIC countries rose 11%, but would have been up by 14% if adjusting for currency.

As we expected, CEO Ginny Rometty maintained her long-term guidance for IBM by saying, "We are well on track toward our long-term roadmap for operating EPS of at least $20 in 2015."

IBM's closing price was up 0.8% to $196.08 today, compared to a 52-week range of $181.85 to $211.79 and to a consensus target of $222.23 on the stock. We currently show shares up more than 3% at $202 in the after-hours trading session.


Filed under: 24/7 Wall St. Wire, Earnings, Technology, Technology Companies Tagged: featured, IBM
Read Full Story

Markets

DJIA 21,080.28 -2.67 -0.01%
NASDAQ 6,210.19 4.94 0.08%
S&P 500 2,415.82 0.75 0.03%
NIKKEI 225 19,677.85 -4.72 -0.02%
HANG SENG 25,701.63 62.36 0.24%
DAX 12,607.66 -21.29 -0.17%
USD (per EUR) 1.11 0.00 0.19%
USD (per CHF) 0.98 0.00 -0.19%
JPY (per USD) 110.94 -0.23 -0.21%
GBP (per USD) 1.29 0.01 0.42%

Can't get enough business news?

Sign up for Finance Report by AOL and get everything from retailer news to the latest IPOs delivered directly to your inbox daily!

Subscribe to our other newsletters

Emails may offer personalized content or ads. Learn more. You may unsubscribe any time.