IBM's Q3 led by software, growth markets

IBM's Q3 led by software, growth markets

Summary: Revenue from growth markets was up 19 percent and sales from Brazil, Russia, India and China jumped 17 percent.

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IBM delivered strong third quarter earnings and raised it outlook amid strong software growth.

Big Blue reported third quarter earnings of $3.8 billion, or $3.19 a share, on revenue of $26.2 billion, up 8 percent from a year ago. Non-GAAP earnings were $3.28 a share.

Wall Street was looking for third quarter earnings of $3.22 a share on revenue of $26.25 billion.

IBM also projected 2011 non-GAAP earnings of $13.35 a share, up from its previous outlook of at least $13.25 a share. Wall Street was expecting $13.32 a share.

The quarter was largely driven by software and emerging markets.

On a conference call, IBM CFO Mark Loughridge touted software and services strength and added that the hardware business continues to take share. "We're continuing to drive competitive displacements and extend our share gains in units," he said.

Loughridge added that the company is on track with its 2015 roadmap. Other key points from the conference call:

  • IBM's Netezza sales were up 36 percent from a year ago.
  • The hardware unit had 250 competitive displacements. Loughridge said half of those displacements came from HP and the other half from Oracle/Sun.
  • Cloud revenue doubled and Loughridge was upbeat about IBM's new offerings.

By the numbers:

  • Software revenue in the third quarter was $5.8 billion, up 13 percent from a year ago. Operating income was $2.2 billion. Middleware revenue was $3.6 billion, up 17 percent from a year ago.
  • Revenue from growth markets was up 19 percent and sales from Brazil, Russia, India and China jumped 17 percent.
  • Global technology services revenue was up 9 percent in the third quarter to $10.3 billion. Global business services revenue was up 6 percent to $4.8 billion. Backlog at the end of the quarter was $137 billion.
  • Hardware revenue in the third quarter was $4.5 billion, up 4 percent from a year ago. Operating income was $318 million. Power Systems revenue surged 15 percent, but System z mainframe sales fell 5 percent from a year ago.

Topics: Enterprise Software, Banking, IBM, Software

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  • RE: IBM's Q3 led by software, growth markets

    [ SOS ] Complaint about Human Rights Violations by IBM China on Centennial

    Please Google:

    Tragedy of Labor Rights Repression in IBM China
    or
    How Much IBM Can Get Away with is the Responsibility of the Media
    or
    IBM detained mother of ex-employee on the day of centennials
    larkforsure
    • RE: IBM's Q3 led by software, growth markets

      @larkforsure
      What I dont get is, why is it always the Chinese that are at the receiving end with this whole human rights and work place ill-treatment issues?

      google, apple, and now IBM..
      These big guns dint grow this well without so much as a employee-welfare policy. think about it, if others are slapping you repeatedly, its not 'they' that might be at fault.
      aditya.kmg
  • RE: IBM's Q3 led by software, growth markets

    i AGree in it always the Chinese that are at the receiving....thanks!
    divulgardrenagem