IBM Corp. announced that it has exceeded its quarterly earnings estimates this year and expects to exceed its full-year revenue growth targets due to robust demand for the company’s digital services.
IBM, which generates more than half of its revenue outside the United States, raised its estimate for the impact of foreign exchange to 7% from 6%. Its cloud revenue rose 11% in the third quarter to $5.2 billion, and the company expects annual revenue to grow faster than its previous estimate of mid-single-digit growth at constant currency.
According to Finance Chief James Kavanaugh, the macroeconomic environment is also causing IBM to show some laxity in key areas such as new bookings and backlog churn in Western Europe.
In the third quarter of 2022, IBM generated revenues of $5.8 billion (+7.5 percent) from software, $4.7 billion (+15.6 percent) from consulting and $22.2 billion (+15 percent) from hybrid cloud. IBM shares also rose 4.4% in extended trading.
Following the spin-off of its legacy IT-managed infrastructure business, the IT software and services provider is focusing on the so-called “hybrid cloud” and recorded double-digit growth across all segments and geographies on a constant-currency basis in the third quarter.
IBM’s cloud revenue rose 11% to $5.2 billion in the quarter, and the company now expects annual revenue to grow faster than its previous estimate of mid-single-digit growth at constant currency.
The sources for this piece include an article in Reuters.
