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IBM earnings fall short as mainframe deals slip

IBM earnings fall short

ibm building 610x3442 IBM earnings fall short as mainframe deals slip

IBM’s first quarter fell short of expectations as deals slipped into the second quarter. IBM’s comments about a poor finish to the first quarter is becoming a common refrain among enterprise technology companies.

The company reported first-quarter earnings of $3 billion, or $2.70 a share, on revenue of $23.4 billion, down 5 percent from a year ago. Non-GAAP earnings for the first quarter were $3 a share.

IBM was expected to report first-quarter earnings of $3.05 a share on revenue of $24.6 billion.

CEO Ginni Rometty said that the company saw a strong start to the quarter, but “we did not close a number of software and mainframe transactions that have moved into the second quarter.”

Rometty is making comments similar to other vendors who saw demand fall off at the end of the quarter. Both Oracle and Tibco said they saw similar drop-offs, but blamed sales execution.

IBM said that it will deliver 2013 non-GAAP earnings per share of at least $16.70. Wall Street is looking for $16.77 a share.

ibm041813a 611x4161 IBM earnings fall short as mainframe deals slip

IBM saw revenue decline in all regions. Revenue in the Americas was $10 billion, down 4 percent from a year ago. Revenue in Europe, the Middle East, and Africa was $7.3 billion in the first quarter, down 4 percent. Revenue in the Asia-Pacific region fell 7 percent to $5.7 billion. Even growth markets such as BRIC countries — Brazil, Russia, India, and China — fell 1 percent.

By division, IBM’s services backlog in the first quarter was $141 billion, up 1 percent. But services revenue overall fell. Software revenue was flat. Hardware revenue fell 17 percent.

ibm041813b 569x4691 IBM earnings fall short as mainframe deals slip

 

[source:cnet]

IBM

 

4 comments

  1. Wavatar

    ive checked out microsoft quarterly earnings, and in comparison this to the need for their stock at that time once the earnings were launched. i cant appear to locate a correlation. what you know already when a companys qrtly earnings demonstrated a rise, more and more people want that companys stock, and also the share cost would increase. from what ive seen it does not seem like this really is what is happening, can you explain that?

  2. Wavatar

    I understand that you can to lead to some pension every year a sum as much as your relevant United kingdom earnings (50K max). Should i subtract gift the help of my relevant United kingdom earnings, or effectively will HMRC return both tax on gift help to the charitable organisation and tax around the pension. For example if my relevant united kingdom earnings were £40K and that i gave away £5K in gift aid, could Then i invest £40K inside a pension and receive £10K away from HMRC or must i only invest £35K in pension?

  3. Wavatar

    My accounting homework is due tonight at midnight, and I only understand about half of how to calculate everything. The book’s examples and online examples aren’t too helpful with this problem. Anyone that is good at accounting please help! Thanks.

    Common stock—$25 par value, 100,000 shares authorized, 50,000 shares issued and outstanding
    $ 1,250,000
    Paid-in capital in excess of par value, common stock 70,000
    Retained earnings 460,000

    Total stockholders’ equity$ 1,780,000

    In year 2012, the following transactions affected its stockholders’ equity accounts.
    Jan.1 Purchased 5,500 shares of its own stock at $15 cash per share.
    Jan.5 Directors declared a $6 per share cash dividend payable on Feb. 28 to the Feb. 5 stockholders of record.
    Feb.28 Paid the dividend declared on January 5.
    July 6 Sold 2,063 of its treasury shares at $19 cash per share.
    Aug.22 Sold 3,437 of its treasury shares at $12 cash per share.
    Sept.5 Directors declared a $6 per share cash dividend payable on October 28 to the September 25 stockholders of record.
    Oct.28 Paid the dividend declared on September 5.
    Dec.31
    Closed the $388,000 credit balance (from net income) in the Income Summary account to Retained Earnings.

  4. Wavatar
    Lucius Brookings

    Why dont companies use profit margin when speaking about second quarter earnings…rather they will use revenue…. is that this simply to fool people into thinking they’re doing much better than they really are…???

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