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Big Blue plummets further

by on21 July 2015


Reaching limbo levels

IBM revenues fell for the 13th quarter and missed the fairly low expectations of the cocaine nose jobs of Wall Street.

To be fair Biggish Blue is in a mess. It has been selling businesses such as low-end servers, cash registers, and semiconductors to focus on high-growth areas like security software, cloud services and data analytics.

Last year it flogged off its x86 server business to Lenovo and is paying contract-chipmaker Globalfoundries to take over its loss-making semiconductor unit.
It has called cloud and mobile computing, data analytics, social and security software its "strategic imperatives" and said these are the areas it wants to move to. These areas rose about 20 percent, yet the new businesses have so far failed to make up for revenue lost to divestitures.

IBM said it expected third-quarter revenue to be the same as revenue from the first quarter, or about $19.6 billion. Revenue from its software business fell 10 percent to $5.8 billion from a year earlier.

Revenue from global technology services such as outsourcing fell 10 percent, hurt by weak discretionary IT spending by clients.
IBM's results were also hurt by the strong dollar. The company, which gets more than half its revenue from overseas, said it expected a slightly greater currency impact in the second half of the year.

Consolidated net income dropped to $3.45 billion for the second quarter, from $4.14 billion, year earlier.

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