IBM posts 14% rise in net income in Q3
New York: Technology giant IBM has reported
a 14 percent jump in net income at USD 3.2 billion for the
third quarter of 2009 despite a slump in the sales.
In the year-ago period, the company had a net income of
USD 2.8 billion, IBM said in a statement.
Total revenues stood at USD 23.6 billion in the quarter
under review, a decrease of seven percent from the same
quarter last fiscal. However, sales increased by one percent
over the previous quarter.
"Our long-term strategic shift to higher-value businesses
again enabled us to deliver outstanding margin, earnings and
cash flow growth in the third quarter," IBM Chairman and Chief
Executive Officer Samuel J Palmisano said, adding "we also saw
improved revenue trends in our business and share gains in
software and hardware."
In its outlook, IBM said it expects full-year 2009
pre-tax income for both its software and services segments to
grow at double-digit rates and reach about USD 8 billion.
From a geographic perspective, IBM saw the Americas'
third-quarter revenues falling by 5 per cent to USD 9.9
billion. While, Asia-Pacific revenues were essentially flat
(down 4 percent) at USD 5.2 billion.
Besides, revenues from Europe, the Middle East and Africa
region were USD 7.8 billion, down by 12 percent.
IBM's balance sheet remains strong with USD 11.5 billion
of cash at the end of the quarter and the company is well
positioned to take advantage of opportunities.
The company returned USD 1.7 billion to shareholders
through USD 726 million in dividends and USD 930 million of
In the software segment, revenues declined by three per
cent to USD 5.1 billion. However, revenues from IBM's key
middle ware products, which include websphere, information
management, Tivoli, Lotus and rational products, were USD 2.9
billion, a two percent increase over the year-ago period.
IBM witnessed a decrease of seven per cent to new
services contract from the September quarter of 2008,
totalling USD 11.8 billion including 13 contracts greater than
USD 100 million.
For nine months ended September, technology major posted
a net income of USD 8.6 billion against USD 7.9 billion in the
year-ago period. Revenues for the period totalled USD 68.5
billion against USD 76.6 billion for the year ago period.
The company's Global Services unit revenues decreased 7
per cent and pre-tax income increased 11 percent. Global
Technology Services segment revenues dropped four percent to
USD 9.4 billion.