International Business Machines released its latest earnings report after closing bell tonight, posting non-GAAP earnings of $5.01 per share on $21.8 billion in revenue. Analysts had been expecting IBM to report $21.6 billion in revenue and $4.88 per share in adjusted earnings. In the same quarter a year ago, the legacy tech firm reported $22.06 billion in revenue and $4.84 per share in earnings.
IBM’s cloud growth continues
IBM’s GAAP earnings rose 3% year over year to $4.73 per share. Fourth quarter cloud revenues jumped 33% year over year, while analytics revenues rose 9%. Mobile revenues rose 16%, while security revenues increased 7%. IBM said the annual run rate for its cloud-as-a-service revenue rose to $8.6 billion at the end of the year from $5.3 billion at the end of 2015.
Cognitive Solutions revenues ticked upward 1.4% to $5.3 billion, while Global Business Services revenues fell 4.1% to $4.1 billion. Technology Services and Cloud Platforms revenues grew 1.7% to $9.3 billion, while Systems revenues slumped 12.5% to $2.5 billion. Global Financing revenues declined 1.5% to $447 million.
IBM guides for 2017
For the full year, diluted earnings declined 9% year over year to $12.39, while non-GAAP earnings fell 9% to $13.59 per share. Full-year revenue fell 2% to $79.9 billion. Wall Street was looking for $79.7 billion in revenue and $13.48 per share in earnings, representing a 2.5% decline and 9.6% decline, respectively. Strategic imperatives revenue for the full year rose 13% to $32.8 billion, while cloud revenue for the full year surged 35% to $13.7 billion.
“In 2016, our strategic imperatives grew to represent more than 40 percent of our total revenue and we have established ourselves as the industry’s leading cognitive solutions and cloud platform company,” IBM chairman, president and CEO Ginni Rometty said in a statement. “IBM Watson is the world’s leading AI platform for business, and emerging solutions such as IBM Blockchain are enabling new levels of trust in transactions of every kind.”
IBM said for 2017, it expects non-GAAP earnings to be at least $13.80 per share and GAAP earnings to be at least $11.95 per share.
Shares of IBM edged upward by as much as 0.73% to $168.02 in after-hours trades.