IBM's Turnaround May Finally Be For Real
For the better part of a decade, International Business Machines (NYSE: IBM) has been working to remake itself as IT budgets increasingly shifted to the cloud. The company landed on a hybrid-cloud strategy. Large enterprises, IBM reckoned, would favor a mix of public cloud and on-premises hardware. Moving to a hybrid-cloud architecture would require specialized software, hardware, and expertise, all of which IBM could deliver.
While IBM's cloud business has been growing swiftly for many years, slow-growing legacy businesses were dragging the company down. The spinoff of the managed infrastructure-services business, now known as Kyndryl, removed billions of dollars of largely stagnant revenue, leaving behind a leaner, more focused IBM.
The most surprising thing about IBM's third-quarter report was that the company raised its revenue guidance and maintained its free cash flow guidance, despite macroeconomic headwinds and major shifts in currency-exchange rates. So far, IBM isn't seeing any real impact from sky-high inflation or economic uncertainty.
Source Fool.com
