UPDATE: IBM 3Q Net Jumps 14%, But Corp Spending Still Slow
15 Octubre 2009 - 5:28PM
Noticias Dow Jones
International Business Machines Corp. (IBM) reported a
better-than-expected 14% jump in third-quarter profit and raised
its 2009 earnings outlook, but the tech giant indicated that
corporate spending remains sluggish despite a stabilizing
economy.
The Armonk, N.Y., tech titan said its signed services contracts,
which indicates future business, fell 7% to $11.8 billion. It was
the company's lowest total since the first quarter of 2008.
On the company's conference call, Chief Financial Officer Mark
Loughridge said that while outsourcing is still strong, consulting
remains weak, continuing a trend over the past few quarters. The
numbers continue to suggest that companies are reluctant to spend
money on nonessential tech services.
Loughridge, though, noted variations within the weak services
signings. For example, the overall global business services
division, which is the consulting part of the services business,
fell 11% in the quarter. However, consulting and systems
integration grew 20% in North America.
"Overall, the economic environment has stabilized," Loughridge
said.
Despite beating the top- and bottom-line estimates for the third
quarter, IBM shares - up 52% year to date - slid on the weak
signings number, dropping 3.7% to $123.25 in late trading. Shares
of Microsoft Corp. (MSFT), Hewlett-Packard Co. (HPQ) and Cisco
Systems Inc. (CSCO) - tech giants that serve the business customer
- all slipped less than 1% in after-hours trading along with
IBM.
For the quarter ended Sept. 30, IBM reported earnings of $3.21
billion, or $2.40 a share, up from $2.82 billion, or $2.04 a share,
a year earlier. Revenue declined 6.9% to $23.6 billion, two
percentage points of which was due to currency changes.
Analysts polled by Thomson Reuters expected per-share earnings
of $2.38 on revenue of $23.4 billion.
Gross margin jumped to 45.1% from 43.3%, led by improved margins
in services and software.
IBM now sees 2009 earnings of at least $9.85 a share, up 15
cents from its previous estimate. Wall Street most recently
expected per-share earnings of $9.78. IBM continued to see earnings
"ahead of pace" for its 2010 outlook of $10 to $11 a share.
For the fourth quarter, Loughridge said the company expected to
post revenue growth. The mean estimate of analysts surveyed by
Thomson Reuters was a 1% drop to $26.79 billion. Chairman and Chief
Executive Samuel J. Palmisano added that IBM saw improved revenue
trends, while notching share gains in software and hardware.
The tech bellwether has benefited for years from its shift to a
software and services business, and away from hardware. The move
has helped the company's results hold up better than others during
the recession.
Revenue in the Americas, IBM's biggest market, fell 5% - falling
4% excluding currency fluctuations. Sales in its Europe and Middle
Eastern region declined 12% but were essentially flat in Asia.
Total global services revenue decreased 7%, as global technology
services fell 4.4% to $9.4 billion, or 2% excluding currency
fluctuations, while global business services dropped 11% to $4.3
billion. Revenue from the software segment were down 3%, or flat
when adjusted for currency.
-By Jessica Hodgson, Dow Jones Newswires; 415-439-6455;
jessica.hodgson@dowjones.com
(John Kell contributed to this article.)