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Wednesday, Jul 17
More on IBM: Huge buybacks ($3.6B) again boosted EPS. Also helping: a 140 bps Y/Y increase in...
More on IBM: Huge buybacks ($3.6B) again boosted EPS. Also helping: a 140 bps Y/Y increase in gross margin to 49.7%. Hardware remained weak, -12% Y/Y (-17% in Q1). System x -11%, System z +10%, aided by refresh. Power systems -25%, storage -7%, chips +6%. Services -4% (-4% in Q1), IBM says it's focusing on high-margin projects. Backlog was $141B, flat Q/Q and +3% Y/Y. Software a bright spot, +4% (flat in Q1). Storage software grew 10%+, Tivoli +13%, WebSphere +10%, "social software" +22%. Financing revenue -6%. Americas -3%, EMEA flat, Asia-Pac -8%. "Cloud" sales +70% in 1H, analytics +11% in Q2. Free cash flow of $2.7B, $17B in last 12 months. Forex pressured results. Company no longer counting on "large divestiture" (likely System x unit) in 2H. IBM +1.2% AH. (PR)