International Business Machines Corp. (NYSE: IBM) reported its financial results for the second quarter on Monday that beat Wall Street estimates. It was the 2nd consecutive quarter for IBM to register revenue growth after a four-quarter streak of declines.
Financial performance
IBM said its net income in the second quarter came in at $1.33 billion that translates to $1.47 per share. In the comparable quarter of last year, its net income stood at a higher $1.36 billion or $1.52 per share.
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On an adjusted basis, the tech giant earned $2.33 per share versus the year-ago figure of $2.18 per share. IBM valued its revenue at $18.75 billion in Q2 compared to $18.12 billion last year. According to FactSet, experts had forecast the company to post $18.29 billion of revenue and $2.31 per share of adjusted EPS.
The American multinational also topped Wall Street estimates in the prior quarter (Q1). CEO Arvind Krishna expressed confidence on Monday that IBM will conclude this year with revenue growth and hit its cash flow objective.
Revenue from individual business segments
According to IBM, it generated $6.1 billion of revenue from cloud and cognitive software, including Red Hat – an increase from $5.75 billion in Q2 of the previous year and $5.93 billion expected.
Other notable figures in the earnings report on Monday include a 13% annualised growth in total cloud revenue. Global technology services revenue remained roughly the same as last year but topped consensus. Global business services revenue also saw a year over year increase to beat expectations. Systems revenue, however, marginally missed estimates and noted a decline from last year.
The earnings report comes only weeks after Red Hat’s Jim Whitehurst stepped down as IBM’s president. IBM shares were about 4% up in after-hours trading on Monday. The $123 billion company has a price to earnings ratio of 23.06.
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