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IBM on Monday reported a 13% rise in profit in the first quarter boosted by growth in the company's software business and emerging markets.
The company reported a profit of $2.6bn, or $1.97 a share, up from $2.3bn, or $1.70 a share, a year earlier. Revenue rose 5.3%, to $22.86bn, but was unchanged if currency effects were stripped out.
“In the first quarter, we drove significantly improved revenue growth rates from the fourth quarter across our businesses and geographies. We had strong results in strategic investment areas including growth markets, business analytics and Smarter Planet solutions,”said Samuel J. Palmisano, IBM chairman, president and chief executive officer. “Looking ahead, we are confident in our ability to grow revenue, and given our mix of higher-value business and productivity we will expand margins, grow profit, cash and EPS, and increase returns to shareholders. Thus, we expect full-year 2010 diluted earnings per share of at least $11.20.”
"We are in more of a growth mode,"IBM CFO said on a conference call."I feel like we have a good hand going into the second quarter."
The first quarter was the first time since 2008 that IBM has reported two consecutive quarters of revenue growth.
Global services unit revenue fell 2% to $12.3bn and the company said it signed 13 services contracts worth at least $100m, down from 16 contracts a year ago and 22 in the fourth quarter.
From a geographic perspective, the Americas’ first-quarter revenues were $9.5bn, an increase of 2% (flat, adjusting for currency) from the 2009 period. Revenues from Europe/Middle East/Africa were $7.6bn, up 5% (down 2%, adjusting for currency). Asia-Pacific revenues increased 10% (1%, adjusting for currency) to $5.3bn.
Revenues from emerging markets account for 19% of IBM's total revenue.
