IBM CEO, Arvind Krishna
IBM Shares rose 3% in extended trading Tuesday after the technology services company released first-quarter results that beat expectations.
Here’s how the company did:
- gains: $1.40 a share, adjusted for, versus $1.38 a share, as expected by analysts, according to Refinitiv.
- Revenues: $14.2 billion, versus $13.85 billion analysts had expected, according to Refinitiv.
IBM said in a statment. This is the company’s first full quarter without the Managed Infrastructure Services business that sprouted into an entity called kendrill. Sales to Kyndryl added 5 percentage points to revenue growth for the quarter.
Net income from continuing operations jumped 64% from the previous year to $662 million. Gross net income decreased by 23%.
IBM raised its full-year guidance, calling for revenue growth in constant currency at the high end of its mid-single-digit range, with 3.5 percentage points of growth from Kyndryl. In January, executives told analysts they expect mid-single-digit growth, not including the impact from Kendrill or the currency.
In the first quarter, IBM’s software segment generated $5.77 billion in revenue, which was 12% higher and above the $5.63 billion consensus of analysts polled by StreetAccount.
Consulting revenue rose 13% to $4.83 billion, above the StreetAccount consensus of $4.6 billion.
Infrastructure revenue fell 2% to $3.22 billion, as customers prepare for IBM’s next-generation mainframes later this year.
Also during the quarter, IBM She said Francisco Partners has agreed to buy Watson’s healthcare analytics and data assets in a deal It said It is worth over $1 billion. IBM released Updated historical figures For the high-margin software sector to better reflect its financials without those companies.
In early March, IBM She said I stopped doing business in Russia after the country invaded Ukraine.
“Russia is a very small part of IBM,” Jim Kavanaugh, the company’s chief financial officer, said in an interview on Tuesday. He said the country accounts for 0.5% of total revenue and 2% of profits.
IBM stock has outperformed the S&P 500 this year, down about 3% as of Monday’s close, while the broader index is down 6%. Investors are trading value stocks in 2022, given rising interest rates and the war in Europe.
Executives will discuss the results with analysts in a conference call beginning at 5 p.m. ET.
Correction: This story has been updated to accurately reflect IBM’s predictions for 2022.
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