IBM Hands Investors Another Mixed Bag
Following a disappointing first-quarter report in April, International Business Machines (NYSE: IBM) provided an encore performance on Tuesday. A 4.7% year-over-year drop in revenue was worse than analysts were expecting, with every segment reporting a decline. IBM's strategic imperatives, which includes growth businesses like cloud computing, analytics, and security, grew sales by just 5% year over year, or 7% adjusted for currency.
It wasn't all bad news. IBM handily beat analyst estimates for earnings, reporting adjusted EPS of $2.97, $0.23 ahead of expectations. The company also reiterated its full-year guidance, which calls for adjusted EPS of at least $13.80, and roughly flat free cash flow year over year. IBM expects the second half of the year to be stronger than the first, driven by service contract signings, including a $1.7 billion cloud services deal with Lloyds, the launch of the new IBM Z mainframe, and an upcoming refresh of its Power servers.
Image source: IBM.
Source: Fool.com
International Business Machines Corp Stock
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