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International Business Machines Corporation (IBM)

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  • Jun. 4, 2013, 11:12 AM
    IBM paid ~$2B to acquire SoftLayer, Bloomberg and the NYT report. GigaOm notes the startup "could help bring order" to the "extremely messy legacy code" behind IBM's Smart Cloud offerings. An IBM exec claims SoftLayer provides needed expertise for supporting private and hybrid clouds, as IBM offers value-added software/services on top of basic infrastructure offerings. Will IBM/SoftLayer pose a challenge to Amazon Web Services (AMZN)? Like AWS, SoftLayer claims many Web/cloud firms as clients, and its support for hybrid server environments is a selling point. But it remains to be seen if IBM will match AWS' aggressive pricing. The purchase comes as IBM protests a $600M deal Amazon scored with the CIA.
    | Jun. 4, 2013, 11:12 AM | 5 Comments
  • Jun. 4, 2013, 9:46 AM
    IBM is acquiring web hosting/cloud infrastructure services firm SoftLayer for an undisclosed sum - with Reuters talking of a $2B+ deal price in March, there's a good chance the price tag is in ten digits. The deal represents a big expansion of IBM's cloud services push - IBM says it will create a new Cloud Services unit that combines SoftLayer with the company's SmartCloud unit. SoftLayer already claims 21K customers over 13 data centers, and IBM promises to expand its offerings to cover the OpenStack platform (previous). Rackspace (RAX -2.1%), a SoftLayer rival, top OpenStack proponent, and one-time subject of an IBM M&A rumor, is lower.
    | Jun. 4, 2013, 9:46 AM | Comment!
  • May 29, 2013, 2:09 PM
    Global server sales fell 5% Y/Y in Q1, says Gartner. That's a reversal from Q4's 5% growth, and evidence of both weak IT spending and a shift towards cheaper hardware. #1 IBM, whose hardware unit had an ugly Q1, saw its revenue share fall 250 bps Y/Y to 25.5%. #2 H-P (HPQ), hurt by crumbling Itanium server demand, saw its share fall 280 bps to 25%, and #5 Oracle (ORCL), hit hard by plunging UNIX server sales, saw a 130 bps drop to 4.6%. But #3 Dell's (DELL) share rose 310 bps to 18%, and Cisco (CSCO) cracked the unit share top-5 at 2.3%. The buying habits of Internet companies led non-top-5 vendors to make up 22% of sales, up 370 bps. Sales of x86 servers (mostly INTC-based) grew 1.8%, down from Q4's 6.6%. (IDC's Q4 data)
    | May 29, 2013, 2:09 PM | 3 Comments
  • May 28, 2013, 7:20 AM
    Patent troll Acacia Research (ACTG) announces its Business Process Modeling Solutions subsidiary has entered into a license agreement with IBM resolving litigation pending in U.S. District Court in Texas. (PR)
    | May 28, 2013, 7:20 AM | 4 Comments
  • May 25, 2013, 4:15 PM
    Apple's (AAPL) effective tax rate of 14% is just a smidgin lower than IBM at 15% and Google (GOOG) at 17%. And Apple's hardly on the lowest rung: Amazon's (AMZN) rate is just 6%, Ford's (F) 3%, and Carnival's (CCL) just 1%. In trying to untangle what S&P 500 companies pay in taxes, David Leonhardt finds top executives are exceptionally shrewd at holding tax rates down. (infographic)
    | May 25, 2013, 4:15 PM | 35 Comments
  • May 24, 2013, 5:37 AM
    IBM (IBM) CFO Mark Loughridge has forecast that the company's earnings will rise 8% Y/Y this quarter, which would be in line with market expectations. The prediction suggests that EPS will increase to about $3.79 from $3.51 last year. Loughridge reiterated that H2 growth will be stronger, with "double-digit performance" in Q4. Meanwhile, IBM will reportedly lay off 270 people in the U.K. and Ireland.
    | May 24, 2013, 5:37 AM | Comment!
  • May 23, 2013, 3:11 PM
    Chatter says trading desks are busy with corporate buyback activity today as CFOs take advantage of a little selling to put repurchase plans into action. AAPL is the gorilla, having bumped its authorization to $60B from $10B. Others of note include: LyondellBasel (LYB), Merck (MRK) - which just entered an accelerated repurchase program, NetApp (NTAP), Northrop Grumman (NOC), Macy's (M), and Delta (DAL). There's also IBM - long with a reputation for issuing debt at lows in yield. Is their equity timing as good?
    | May 23, 2013, 3:11 PM | 6 Comments
  • May 16, 2013, 12:16 PM
    Cisco JV partner EMC (EMC +4.5%) joins the list of companies rallying in response to Cisco's FQ3 beat and guidance. Cisco mentioned on its earnings call integrated hardware solutions such as Vblock (offered by the Cisco/EMC VCE JV) are driving demand for its UCS servers - Cisco's UCS unit saw 77% Y/Y rev. growth. All in all, it's a good day for enterprise IT names, who are happy to receive some good earnings news after getting plenty of bad news (I, II, III, IV). HPQ +1.7%. IBM +1.3%. ORCL +1.3%. VMW +2.6%. TIBX +4.1%. CTXS +3.9%. CRM +3.8%. JIVE +4.1%. NTGR +2.7%. CVLT +2.6%. INFA +3%. (others rallying: I, II)
    | May 16, 2013, 12:16 PM | 1 Comment
  • May 3, 2013, 9:35 AM
    The DOJ has launched a bribery probe on IBM (IBM +0.9%) regarding corruption allegations in Poland, Bangladesh, Argentina, and Ukraine, the company discloses in its Q1 10-Q. The probe comes on top of an SEC bribery case against IBM's activities in China and South Korea, which Big Blue is trying to settle. Separately, Warren Buffett says he won't be selling his IBM shares, and may buy more "from time to time." (Microsoft investigation)
    | May 3, 2013, 9:35 AM | 8 Comments
  • May 1, 2013, 5:53 PM
    Talks between IBM and Lenovo (LNVGY.PK) regarding the sale of IBM's x86 server business have broken down, sources tell Fortune. Lenovo reportedly balked over IBM's asking price - according to one CRN source, it was around $5B-$6B - for the business, which had an estimated $4.9B in 2012 sales and saw a 9% Y/Y revenue drop in Q1. Regardless of the specific price, Lenovo (current market cap of $10.4B) would have a tough time digesting the unit. (prior reports: I, II)
    | May 1, 2013, 5:53 PM | 2 Comments
  • Apr. 30, 2013, 10:49 AM
    IBM (IBM +0.8%) is raising its quarterly dividend by $0.10/share, or 12%, to $0.95/share, and increasing its buyback authorization by $5B to $11.2B. Big Blue's yield is now at 1.9%, and its buyback authorization is now good for repurchasing 5.1% of shares at current levels. IBM carried out $2.6B in buybacks in Q1 - its EPS miss would've been much worse without them. The company notes it has raised its dividend 18 years in a row and lowered its share count by a third since 2000, and says it expects to request another authorization at its Oct. board meeting. (PR)
    | Apr. 30, 2013, 10:49 AM | 5 Comments
  • Apr. 25, 2013, 7:40 AM
    IBM has "reassigned" Rodney Adkins, until now the head of its hardware and chip ops, following a dismal Q1 for the business, the WSJ reports. Tom Rosamilia, IBM's VP of corporate strategy and GM of enterprise initiatives, is said to have replaced him. Adkins' division saw a 17% Y/Y sales drop in Q1, headlined by a 32% drop in high-end Power server sales. Big Blue blamed the weakness on execution, but many suspect IT demand and/or industry trends are also responsible. The WSJ's scoop follows multiple reports claiming IBM's x86 server unit (-9% in Q1) is on sale.
    | Apr. 25, 2013, 7:40 AM | Comment!
  • Apr. 22, 2013, 12:32 PM
    IBM has acquired UrbanCode, a developer of tools for speeding up and automating the delivery of a variety of apps. IBM asserts UrbanCode's products, which will be integrated with its sizable Rational app development tool unit (competes with Microsoft, Oracle, and Borland) serve as "a natural extension" of its DevOps strategy, which aims to speed up and simplify enterprise app development. Big Blue also claims synergies with its SmartCloud and MobileFirst initiatives, which respectively encompass a huge array of cloud and mobile products/services. (PR)
    | Apr. 22, 2013, 12:32 PM | Comment!
  • Apr. 19, 2013, 6:51 PM
    "We suspect accelerating adoption of cloud computing is at the very least creating some delays as customers assess options," writes CLSA's Ed Maguire, discussing IBM's (IBM -8.3%) Q1 hardware troubles. Of course, concerns about the impact of the technology preferences of Internet/cloud providers on IT hardware giants are nothing new. ZDNet's Larry Dignan sees IBM's reported interest in selling its x86 server business as evidence IBM recognizes the x86 market is getting commoditized, and that it only makes sense to offer proprietary hardware. But even there, a long-term migration to cloud infrastructures presents a challenge.
    | Apr. 19, 2013, 6:51 PM | Comment!
  • Apr. 19, 2013, 9:55 AM
    IBM (IBM -6.5%) would've missed Q1 EPS estimates by $0.34, rather than $0.05, if not for a lower tax rate, says BMO's Keith Bachman. Like others, Bachman is skeptical Big Blue's woes are solely due to execution, given weak results from peers (one can now add SAP to the list). "We think demand was perhaps weaker than we and the companies thought." Sterne Agee, however, is staying bullish precisely because it doesn't consider IBM's issues company-specific. Meanwhile, the WSJ is backing up CRN's report about the relatively low-margin x86 server unit being on sale. Morgan Stanley estimates the unit had 2012 sales of $4.9B. (previous) (transcript)
    | Apr. 19, 2013, 9:55 AM | 9 Comments
  • Apr. 18, 2013, 6:18 PM
    More on IBM's CC: Management stressed execution (particularly related to closing deals), rather than macro, is the main culprit for the Q1 miss. However, U.S. federal sales (a problem for many) fell 13% Y/Y, and China was also weak (leadership transition blamed). Free cash flow was $1.7B, down $200M Y/Y partly due to tax issues. $1B in "workforce rebalancing charges" are expected this year, mostly outside the U.S. IBM refuses to comment on CRN's x86 server sale report, but does say it's evaluating asset sales. IBM is counting on expanded Linux support to lift slumping Power server sales. Over 4K PureSystems sold thus far. Update: The WSJ is now also reporting the x86 server unit is on the block.
    | Apr. 18, 2013, 6:18 PM | 1 Comment
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Company Description
International Business Machines Corp is an Information Technology (IT) company. It creates business value for clients and solves business problems through integrated solutions that leverage information technology & knowledge of business processes.