Software growth helps IBM boost 4Q earnings

Published on NewsOK Modified: January 22, 2013 at 6:18 pm •  Published: January 22, 2013

Revenue from software was $7.9 billion, an increase of 3 percent from the fourth quarter of 2011. Revenue from hardware fell 1 percent to $5.8 billion and revenue from technology services fell 2 percent to $10.3 billion. Revenue from other businesses declined as well.

For the full year, IBM earned $16.6 billion, or $14.37 per share, up 5 percent from $15.86 billion, or $13.06 per share, in 2011. Adjusted earnings were $15.25 per share last year, above analysts' estimates of $15.14.

Revenue declined 2 percent to $104.5 billion from $106.9 billion. Analysts had expected slightly lower revenue of $104.4 billion.

For 2013, IBM expects earnings of at least $15.53 per share. It expects adjusted earnings of at least $16.70, above the $16.65 that analysts were expecting.

The company said it is "well on track" toward its long-term outlook for adjusted earnings of at least $20 per share in 2015. By 2015, it also expects software to account for more than half its total profit. In 2012, software accounted for 45 percent of IBM's profit, up from 43.5 percent a year earlier.

Armonk, N.Y.-based IBM's stock rose $8.37, or 4.3 percent, to $204.45 in after-hours trading. The stock had closed up $1.61 at $196.08 in the regular session.