Categories Earnings, Technology

In-line outlook, cloud revenue push IBM shares up after Q2 results

Earnings of technology conglomerate IBM (IBM) rose 3% in the second quarter, as strong cloud revenue lifted the top line. Earnings adjusted for special items increased by 4.8%. Shares of IBM rose 0.95% in the after-hours trading as its outlook remained unchanged.

Net income rose 5.6% to $2.63 per share during the quarter. Excluding one-time items, operating earnings increased to $3.08 per share. First quarter revenues grew 4% year-on-year to $20 billion, continuing the rebound that began two quarters earlier.

The diversified tech giant maintained its outlook for full-year adjusted operating income of at least $13.80 per share and net earnings of at least $11.60 per share. The outlook remained in line with the consensus estimate. The company continues to expect free cash flow of about $12 billion in fiscal 2018.

IBM second quarter 2018 earnings
IBM Q2 2018 Earnings Infographics

Driving the overall top-line growth, revenues of the Strategic Imperatives segment rose 15% to $39 billion, with cloud revenue jumping 23% annually.

Segment wise, Cognitive Solutions revenue remained flat, while Global Business Services revenue moved up 2%. Revenue of Technology Services & Cloud Platforms rose 2%, while that of Systems jumped 25%. Meanwhile, Global Financing revenue declined 5% during the quarter.

Cloud computing, analytics, and artificial intelligence remained the main growth areas for IBM that replaced its legacy businesses. Revenue from analytics increased 7%, Mobile revenue rose 5%, and revenue from security jumped 81%.

Among IBM’s rivals in the software business, Oracle (ORCL) reported adjusted earnings of $0.99 per share in the fourth quarter, up 11% compared to the prior-year quarter. Microsoft (MSFT) is scheduled to report its fourth-quarter earnings on July 19.

Shares of IBM ended Wednesday’s regular trading session up 0.72% at $144.52 on the NYSE. The stock had been trading between $137.45 and $171.13 for the past 52 weeks.

Related: What to expect from Microsoft on Thursday

Most Popular

Electronic Arts (EA) Q4 earnings drop and miss estimates; revenue down 3%

Video game company Electronic Arts, Inc. (NASDAQ: EA) reported lower earnings and revenues for the fourth quarter of 2021. Earnings also missed analysts' forecast. During the March quarter, net bookings

What lies in store for Tyson Foods (TSN) this year?

Shares of Tyson Foods Inc. (NYSE: TSN) were in green territory during afternoon hours on Tuesday. The stock has gained 32% over the past 12 months and 23% since the

Virgin Galactic (SPCE) fails to impress market amid looming uncertainty

Space tourism company Virgin Galactic Holdings, Inc. (NYSE: SPCE) ended the first quarter of 2021 without generating revenue and continued the losing streak even as uncertainty over its test flight

Tags

Add Comment
Loading...
Cancel
Viewing Highlight
Loading...
Highlight
Close
Top