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IBM (IBM) released mixed third quarter results after Wednesday's closing bell, reporting $14.97 billion in revenue ($15.05 billion was expected) and adjusted earnings of $2.30 per share ($2.22 was expected). IBM shares have slipped by over 4% in extended-hours trading.
Market Domination Overtime Julie Hyman and Josh Lipton run through the multinational technology company's revenues across its various segments, including software and generative AI.
To watch more expert insights and analysis on the latest market action, check out more Market Domination Overtime here.
This post was written by Luke Carberry Mogan.
IBM third quarter earnings just crossing the wire moments ago and shares are falling. Let's get you an update there. Bottom line, EPS is 230, that is versus expectations of 222. Revenue though, 14.97, street wanted to see something closer to 1505. So, that is a miss on the top line relative to consensus. Software revenue, Julie, looks like it beat. Um, consulting looks like it might have come in a bit light, and IBM generative AI book they're saying stands at more than three billion right now. But, at least initially, shares falling.
Yeah. And if you look at those individual business lines, um software revenue rose by 9.7%, consulting revenue down a half of 1%, and infrastructure revenue fell by 7%. So, interesting to see those different lines of business and how they were doing. Arvind Krishna, the CEO, um in the statement talking about the strength in software, uh including what he highlighted as a reacceleration in Red Hat. Um and of course, he's, you know, trumpeting the company's AI business as well, saying the generative AI book of business is at $3 billion, which is a $1 billion quarter-to-quarter increase there. Um however, he also says that fourth quarter constant currency revenue will be consistent with the third quarter with continued strength in software. So not a re, you know, the the growth rate will be the same, not an acceleration from these levels.
Yeah, but expectations were hot, running up the the stock was up about 40% this year heading heading into the print. Software narrative is going to be really interesting to listen to, um, 'cause software does represent about 40% of total revenue mix, but it's actually more in pre-tax income. So that that'll be really interesting to see how they see that business now, what they see ahead.