Because IBM’s profits are down
What emerges from the second quarterly of IBM
Accounts in light and dark for IBM.
Yesterday, the technology group announced that in the first half of the year it made profits of 2.28 billion dollars, 10% less than the 2.536 billion obtained in the same period last year.
On the other hand, IBM has seen sales increase in the last 6 months, growing from 35,694 to 36,474 million, 2.2% more than the previous year.
Even if the increase in turnover is modest, it represents a positive return to growth, especially after closing a 2020 in which the trend was down and saw its revenues drop strongly.
“We are pleased with our progress and remain well positioned to deliver full-year revenue growth to achieve our cash target,” said Arvind Krishna, the company's CEO, in presenting the results for the second quarter of 2021.
However, IBM's results were better than analysts' forecasts, so much so that on Wall Street the company's shares rose 2.9 percent to $ 141.87.
International Business Machines Corp. recorded the largest revenue increase in three years thanks to strong demand for cloud computing, Bloomberg points out.
All the details.
DECREASING PROFITS
The 10% decline in profits in the half year was however mainly determined by tax adjustments.
In the quarter ended June 30, IBM's net income fell to 1.33 billion, or $ 1.47 per share, from 1.36 billion, or $ 1.52 per share, a year earlier.
SALES GO UP
In addition, the company has seen sales increase over the past six months, from $ 35.694 billion to $ 36.474 billion, a 2.2% year-on-year increase.
Specifically for the second quarter, sales increased 3.4% to $ 18.7 billion. A result in excess of the $ 18.3 billion analysts had predicted, according to Bloomberg .
DIVIDENDS DECREASE
Shareholders of the longtime computer maker, now transformed primarily into a digital services company, reaped lower dividends than they did a year ago, dropping from $ 2.83 to $ 2.52.
TECHNOLOGICAL SERVICES DRIVE IBM'S BUSINESS
Global technology services remain IBM's largest source of revenue (35%), albeit increasingly followed by cognitive software and the cloud (31.6%) and, further away, global business services (23.5%) .
CLOUD GROWS
The cognitive software and cloud segment, considered strategic for the company's future, saw strong growth of 5%. Cloud business sales increased 13% to $ 7 billion in the reported quarter.
“We had strong results in our global business services segments in the second quarter as our customers embraced hybrid cloud,” Krishna said.
Seeing a $ 1 trillion market opportunity in the “hybrid cloud,” IBM has invested heavily in cloud and artificial intelligence-centric initiatives. The company has invested in skills development for competing cloud service providers, such as Amazon Web Services and Microsoft Azure, said Jim Kavanaugh, chief finance at IBM.
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/innovazione/perche-gli-utili-di-ibm-sono-in-calo/ on Tue, 20 Jul 2021 10:56:47 +0000.