US International Business Machines Corp. (IBM) slightly increased its net profit in the third quarter of 2020, despite on the declining revenue in the context of the coronavirus pandemic, forcing businesses to delay implementation of projects to preserve capital.
According to the press release of the company, Net income in July-September was $ 1.7 billion, or $ 1.89 per share, compared to $ 1.67 billion, or $ 1.87 per share, for the same period last year. Earnings excluding one-time factors amounted to $ 2.58 per share.
IBM’s quarterly revenue decreased from 2.6% to $ 17.56 billion.
Experts surveyed by FactSet, on average, the company’s net profit in the third quarter was projected at $ 2.08 per share, adjusted earnings – $ 2.58 per share, revenue – $ 17.54 billion.
Earlier this month, IBM announced plans to spin off the IT infrastructure management operations to the independent company. At the same time, it published preliminary reports for the third quarter.
IBM is increasingly focusing on the fast-growing hybrid cloud technology operations. In the last quarter, the total revenue from cloud services scattered across different parts of the company jumped from 19% to $ 6 billion, noted in IBM.
Revenue from the cloud and cognitive technology division (including cloud and data processing platforms, cognitive applications and transaction processing platforms, and Red Hat metrics) rose to 7% in the third quarter to $ 5.55 billion. Experts predicted an average revenue of the business at $ 5.48 billion.
“The good performance of our cloud business, especially Red Hat, underscores the growing use of our open hybrid cloud platform by customers,” said IBM CEO Arvind Krishna. – The business department in the field of managed IT-infrastructure will create the independent company with leading market positions, and will allow IBM to narrow its focus by focusing on the hybrid cloud platform and artificial intelligence of the capabilities. ”
Global technology services revenue fell from 4% to $ 6.5 billion in the third quarter (consensus forecast $ 6.25 billion). In the field of IT consulting, revenue decreased by 5% to $ 4 billion (consensus forecast – $ 3.9 billion), in the segment responsible for hardware and software production, – decreased by 15% to $ 1.3 billion (consensus forecast – $ 1.55 billion).
Shares of IBM fell to 2.9% on Monday in additional trading after the company published the reports. Since the beginning of this year, its capitalization has decreased by 6.4%, while the Dow Jones Industrial Average fell by 1% during this period.
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