- IBM’s 2Q Revenue: $15.77 billion, an increase of 1.9% compared to last year, beating the estimate of $15.61 billion.
- Software Revenue: $6.74 billion, a 7.1% increase year-over-year, exceeding the forecast of $6.51 billion.
- Consulting Revenue: $5.18 billion, down 0.9% year-over-year, slightly missing the estimate of $5.31 billion.
- Infrastructure Revenue: $3.65 billion, up 0.7% year-over-year, surpassing the estimate of $3.54 billion.
- Financing Revenue: $169 million, a decline of 8.6% compared to last year, falling short of the $181.3 million estimate.
- Other Revenue: $38 million, a 75% decrease year-over-year.
- Adjusted Gross Margin: 57.8%, higher than last year’s 55.9% and the estimate of 56.1%.
- Operating EPS: $2.43 per share, up from $2.18 last year and exceeding the estimate of $2.20.
- Free Cash Flow: $2.61 billion, a 24% increase year-over-year, better than the expected $2.36 billion.
- Comments by CEO: The generative AI book of business has grown to more than $2 billion since the launch of watsonx one year ago, according to CEO Arvind Krishna.
- Cash and Marketable Securities: IBM ended 2Q with $16 billion in cash, restricted cash, and marketable securities, an increase of $2.5 billion from the end of 2023.
- Fiscal Year Outlook: IBM expects constant currency revenue growth to be consistent with the mid-single digit model and anticipates free cash flow above $12 billion.
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International Business Machines on Smartkarma
Analysts on Smartkarma, including Baptista Research, have been closely covering International Business Machines (IBM) with a positive outlook. Baptista’s research highlights IBM’s solid performance in Q1 2024, showcasing strong financial results in revenue and cash flow. The company’s hybrid cloud and AI strategy, along with a well-performing software division, indicate the quality of IBM’s portfolio.
Furthermore, another report from Baptista Research emphasizes IBM’s growth in the last quarter of 2023, with 3% revenue growth and significant free cash flow. The Chairman and CEO, Arvind Krishna, has led IBM towards a diversified business model, focusing on software enhancements and consulting services. Analysts seem optimistic about IBM’s progress and strategic acquisitions like HashiCorp and Software AG contributing to its future success.
A look at International Business Machines Smart Scores
| Factor | Score | Magnitude |
|---|---|---|
| Value | 2 | |
| Dividend | 4 | |
| Growth | 4 | |
| Resilience | 2 | |
| Momentum | 3 | |
| OVERALL SMART SCORE | 3.0 |
Smart Score is a compound score for the Company indicating its overall outlook. It is derived by taking an equally weighted average of underlying Factor scores computed by Smartkarma
International Business Machines Corporation (IBM), known for providing computer solutions using advanced information technology, has received moderately positive scores across key factors that impact its long-term outlook. With a value score of 2, IBM may offer reasonable investment opportunities at its current valuation. The company’s strong dividend score of 4 and growth score of 4 indicate solid potential for income generation and future expansion. However, with resilience and momentum scores of 2 and 3 respectively, IBM may face challenges in adapting swiftly to market changes and maintaining consistent performance in the near future.
Despite facing some hurdles in resilience and momentum, IBM’s focus on providing comprehensive technology solutions, products, and services globally positions it as a notable player in the industry. Investors considering IBM should closely monitor how the company navigates through its challenges while leveraging its strengths in dividends and growth to drive future value creation.
Disclaimer: This article by Smartkarma is general in nature and based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Note that our articles may not factor in the latest price-sensitive company announcements or qualitative material.
While all reasonable care has been taken in the preparation, Smartkarma makes no assurance about the accuracy of any generated data or content. All content is indicative only and should be independently checked for accuracy and confirmed before use. Smartkarma accepts no responsibility for any loss or damage caused as a result of any inaccuracy or error within the Lab online tools or generated data.
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