IBM reported first-quarter net income of $955 million, or $1.06 a share, compared with $1.18 billion, or $1.31 a share, in the year-ago period. Revenue rose to $17.73 billion from $17.57 billion in the year-ago quarter. Adjusted earnings, which exclude stock-based compensation expenses and other items, were $1.77 a share, compared with $1.84 a share in the year-ago period.
Analysts had estimated $1.69 a share and a decline in revenue to $17.32 billion for the first quarter.
“Strong performance this quarter in cloud, driven by increasing client adoption of our hybrid cloud platform, and growth in software and consulting enabled us to get off to a solid start for the year,” said Chairman and Chief Executive Arvind Krishna in a statement. “While we have more work to do, we are confident we can achieve full-year revenue growth, and meet our adjusted free cash flow target in 2021.”
Global technology services, or GTS, posted $6.37 billion in revenue compared with $6.47 billion in the year-ago quarter and the $6.32 billion Street consensus.
The company reported cloud- and cognitive-software revenue — which includes its Red Hat unit — of $5.44 billion compared with $5.24 billion a year ago, while analysts had been expecting $5.48 billion.
Total cloud revenue, which draws from various business units, grew 21% to $6.5 billion from a year ago, IBM said.
Global business services revenue was $4.23 billion, compared with $4.14 billion a year ago, and Street forecasts of $4.03 billion. Systems revenue was $1.43 billion, compared with $1.37 billion a year ago and analysts’ expectations of $1.29 billion.
IBM said it expects ” to grow revenue for the full-year 2021 based on mid-April 2021 foreign exchange rates.” Analysts expect full-year revenue of $74.07 billion, or a gain of 0.6% from 2020.
“Strong performance this quarter in cloud, driven by increasing client adoption of our hybrid cloud platform and growth in software
and consulting enabled us to get off to a solid start for the year.
We are confident we can achieve full-year revenue growth and meet our adjusted free cash flow target in 2021.”
– Arvind Krishna, IBM Chairman and CEO