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July 21, 2021, 9:09 a.m. EDT

IBM Beats the Wall Street Forecasts

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Jul 21, 2021 (IAM Newswire via COMTEX) -- The season of big tech's quarterly earnings report is kicking off. The financial results of the quarter ended on June 30 [th] are ready to be shown to the investors, and International Business Machines Corporation /zigman2/quotes/203856914/composite IBM -0.88% is here to start us off. The company should be proud of its services and its software, as both were the key to achieving better than expected second-quarter earnings. IBM reported quarterly revenues of $18.75 billion and adjusted earnings per share of $2.33. In the first half of next week, we are expecting the results from Apple /zigman2/quotes/202934861/composite AAPL -1.83% , Alphabet /zigman2/quotes/205453964/composite GOOG -2.02% , and Microsoft /zigman2/quotes/207732364/composite MSFT -1.75% , the mid-week is reserved for Facebook /zigman2/quotes/205064656/composite FB -2.24% , followed by Amazon /zigman2/quotes/210331248/composite AMZN -0.74% .

Second-quarter results

The tech giant's quarterly revenues of $18.75 billion are above the Wall Street estimate of $18.3 billion. Compared to the year before, and after adjusting for currency and divestitures, the revenues are about flat. Company's cloud and cognitive software business generated revenues of $6.1 billion, which is an increase of 6.1% (or 2.5% in constant currency). This segment was also above the Wall Street forecast of $5.9 billion. The revenues from Global Business Services were up 11.6% (or 7.3% in constant currency), or $4.3 billion, while the estimate was $4.1 billion. Global Technological Services, IBM's IT outsourcing business, generated $6.3 billion, which is also above the Wall Street estimate, but down 4.1% (adjusted for currency). And finally, System revenues were down by 10.2% (in constant currency). All of this led to non-GAAP profits of $2.33 a share¸ 4 cents above the estimates. The gross profit margin reached 49.3%, which is an increase of 0.3pp.

Outlook

Jim Kavanaugh, IBM CFO, was satisfied with the fact the company reduced borrowings by $18 billion since its acquisition of Red Hat in 2019, and that the clients are adopting the hybrid cloud model, which integrates public and private could service with on-premises infrastructure. Therefore, the previous full-year adjusted cash flow forecast of $11-12 billion is still valid. As most markets are recovering from the pandemic, that is a favorable environment for IT spending, so the demand for investments into IT services and infrastructure is improving. Maybe IBM was a bit late into the cloud game, but similar to Oracle /zigman2/quotes/202180826/composite ORCL -0.99% , it might be a solid grower in the next couple of years. As the Department of Defense decided to reset Pentagon's $10 billion JEDI contract, that welcomed back players like IBM, offering hybrid cloud architecture, which offers extra network security to its customers.

IAMNewswire. It should not be construed as investment advice at any time please read the full . IAM Newswire does not hold any position in the mentioned companies. Press Releases – If you are looking for full Press release distribution contact: Contributors – IAM Newswire accepts pitches. If you're interested in becoming an IAM journalist contact:

The post IBM Beats the Wall Street Forecasts appeared first on IAM Newswire .

COMTEX_390180698/2618/2021-07-21T09:09:17

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/zigman2/quotes/203856914/composite
US : U.S.: NYSE
$ 135.23
-1.20 -0.88%
Volume: 5.63M
Sept. 17, 2021 4:00p
P/E Ratio
22.82
Dividend Yield
4.85%
Market Cap
$121.21 billion
Rev. per Employee
$196,163
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/zigman2/quotes/202934861/composite
US : U.S.: Nasdaq
$ 146.06
-2.73 -1.83%
Volume: 129.87M
Sept. 17, 2021 4:00p
P/E Ratio
28.61
Dividend Yield
0.60%
Market Cap
$2414.40 billion
Rev. per Employee
$1.86M
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/zigman2/quotes/205453964/composite
US : U.S.: Nasdaq
$ 2,829.27
-58.20 -2.02%
Volume: 3.00M
Sept. 17, 2021 4:00p
P/E Ratio
30.67
Dividend Yield
N/A
Market Cap
$1881.83 billion
Rev. per Employee
$1.35M
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/zigman2/quotes/207732364/composite
US : U.S.: Nasdaq
$ 299.87
-5.35 -1.75%
Volume: 41.37M
Sept. 17, 2021 4:00p
P/E Ratio
37.23
Dividend Yield
0.83%
Market Cap
$2253.49 billion
Rev. per Employee
$928,663
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/zigman2/quotes/205064656/composite
US : U.S.: Nasdaq
$ 364.72
-8.34 -2.24%
Volume: 26.30M
Sept. 17, 2021 4:00p
P/E Ratio
27.01
Dividend Yield
N/A
Market Cap
$1028.31 billion
Rev. per Employee
$1.47M
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/zigman2/quotes/210331248/composite
US : U.S.: Nasdaq
$ 3,462.52
-25.72 -0.74%
Volume: 4.62M
Sept. 17, 2021 4:00p
P/E Ratio
60.35
Dividend Yield
N/A
Market Cap
$1753.56 billion
Rev. per Employee
$297,430
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/zigman2/quotes/202180826/composite
US : U.S.: NYSE
$ 86.39
-0.86 -0.99%
Volume: 58.07M
Sept. 17, 2021 4:02p
P/E Ratio
18.35
Dividend Yield
1.48%
Market Cap
$236.55 billion
Rev. per Employee
$306,659
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