International Business Machines Corp. (NYSE:IBM) announced a disappointing first quarter results. Shares of the information technology giant began to slide, weighing down the Dow Jones Industrial Average. International Business Machines Corp. (NYSE:IBM) has the highest weighting among the 30 components of the Dow.

IBM logo

German software giant SAP AG (NYSE:SAP) also announced its quarterly earnings. Though Walldorf, Germany-based company said it is satisfied with the performance, results fell short of Wall Street expectations.

International Business Machines Corp. (NYSE:IBM)

The tech bellwether reported a net profit of $$3.03 billion, or $2.70 a share in the latest quarter, down from $3.07 billion, or $2.61 per share in the same period a year ago. Revenues declined 5.1 percent to $23.41 billion. Analysts were expecting $24.62 billion in revenues and $3.05 per share in earnings.

Shares of International Business Machines Corp. (NYSE:IBM) were down 7.93 percent to $190.76, which pulled the Dow Average down by 36.21 points or 0.25 percent to 14,500.93. Take away the International Business Machines Corp. (NYSE:IBM)’s decline and the Dow will shoot up by about 100 points. Analysts closely watch the shares of IBM, which gives an estimate of the government and corporate spending on technology services.

International Business Machines Corp. (NYSE:IBM)’s revenues have been declining for the past few quarters as governments and corporations are cutting their budget due to uncertain U.S. economy. Read the detailed valuation analysis of IBM Corp. here.

SAP AG (NYSE:SAP)

Defying the industry trend, the German software giant reported a 17 percent increase in its net profit, which rose to 520 million euros ($678.7 million). Revenues of SAP AG (NYSE:SAP) also grew 7 percent during the quarter. The company has consistently outperformed its peers. Revenues from cloud business more than tripled to 137 million euros. Revenues from its new database software HANA also increased three-fold YoY to 86 million euros.

However, software revenues, which grew only 3 percent, missed Wall Street expectations. Software sales declined in Asia-Pacific region as many of the key management positions remain vacant. The company expects to bounce back in the second quarter.

Despite missing Wall Street expectations, SAP AG (NYSE:SAP) is satisfied with its performance, and remains optimistic about its full-year outlook. SAP AG (NYSE:SAP) expects the software and cloud revenues to grow 14-20 percent in 2013, and earnings to grow to 5.85-5.95 billion euros.

American shares of SAP AG (NYSE:SAP) were down 3.86 percent to $75.19 at 1:36 PM EDT.