On Tuesday, shares of International Business Machines traded higher after the technology company posted their third quarter earnings report that beat most analysts estimates.
The company was originally projected to post another decline for the third quarter after it posted a decline in their revenue for the 21st consecutive quarter during the second quarter of the year.
IBM shares which were down by 7% at the time of the release of their second quarter earnings report a couple of months ago are now trading 5% during the most recent trading session closing in at $146.54 per share.
During the second quarter, the company posted a revenue of $19.29 billion which is below most analyst estimates of $19.46 billion representing a decline of 4.7% year over year or short of $160 million. IBM earnings then came at $2.97 per share which beats consensus analyst estimates of $2.74 per share. However, IBM’s revenue still fell short of most analyst estimates sending most shares of the company down after the report up until the release of their third quarter earnings report.
By the third quarter, IBM shares have slipped by around 12% following the continuous losses it suffered during the past couple of months. IBM was then projected to post earnings of $3.28 per share and a revenue of $18.61 billion representing a decline of 3%.
Investors also expected updates regarding the company’s individual businesses and have commented on wanting to hear the company’s future strategies and plans.The company who has previously shifted into offering cloud computing services to customers due to demand is expected to depend on their cloud computing business to attribute to most of their revenue in the future.
For the third quarter of the year, IBM was able to post earnings of $3.30 per share beating consensus most analyst estimates of $3.28 per share. For the first time in the past twenty-one quarters, IBM was also able to post a revenue beat delivering revenue worth $19.15 billion compared to most analyst estimates of $18.6 billion.
IBM’s revenue from their cloud business has risen by 20% year over year to $4.1 billion. However, their revenue from their technology services and cloud platforms business for the quarter was down by 3% from last year to $8.5 billion. Their revenue from global business services also slipped by 2% to $4.09 billion while their systems business rose higher by 10% to $1.72 billion.
IBM chief executive officer Ginni Rometty stated that the company was able to achieve the double digit growth in their strategic imperatives due to their enterprise cloud leadership as well as the expansion of their cognitive solutions business.
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