Feeds

Servers carry IBM to solid Q1

A little currency love too

  • alert
  • submit to reddit

Top 5 reasons to deploy VMware with Tegile

A solid performance from IBM's server unit helped carry the company to a decent first quarter.

IBM reported $22.2bn in total revenue for the quarter, which stands as an 11 per cent increase over the $20.1bn posted a year ago. Net income also increased to $1.6bn up from $1.4bn.

"IBM continued to out-perform the industry in our selected segments and gained share," said Sam Palmisano, CEO at IBM. "We continued our industry-leading work in services with more than $10bn in signings after a very strong fourth quarter of signings, and we grew our software and systems businesses, with significant progress in zSeries (mainframe) servers and WebSphere middleware. We delivered double-digit growth in emerging markets such as China, Eastern Europe, India and Brazil. Our balance sheet remains strong, with $8.5bn of cash on hand."

As has been the case of late, IBM's results were boosted favorable currency conditions. For example, the 11 per cent total revenue gain drops to 3 per cent in constant currency. IBM's hardware business was the only major group to post double-digit gains in constant currency.

The first quarter success of the hardware team should come as no surprise. IBM has been steadily gaining share against competitors in both the Intel/AMD and Unix markets.

In Q1, IBM's hardware revenue rose 16 per cent (10 per cent in constant currency) to $6.7bn. A 100 percent increase in mainframe "computing power" was a major driver for this business. Since last year's Q1, IBM has rolled out several new mainframe systems. Intel/AMD and Unix server revenues were up as well.

IBM's software business pumped out $3.5bn in sales - an 11 per cent year-over-year increase (3 per cent with currency adjustments). The PC division increased revenue 18 per cent to $2.8bn. On the down side, IBM's financing operations saw revenue drop 6 per cent to $662m.

IBM's oft talked about global services group managed to increase revenue 9 per cent to $11bn from $10.2bn last year.

While IBM said its growth was ahead of competitors, recent results do not really back up the claims. IBM's microelectronics business, for example, had a $154m loss in the quarter - much higher than the $11m loss in the year earlier period. Intel and AMD, by contrast, posted solid results.

In hardware, IBM faired only okay. Storage-heavy EMC posted much stronger overall growth, and Dell recently upped an already optimistic forecast.

IBM's only real whipping boy was Sun.

All in all, however, it's hard to compare more specialized companies against IBM. The best head-to-head mark will come when HP reports its results. ®

Related stories

IBM sells off low-end PowerPC chips
Offshore analysts speak with forked tongue
IBM buys disaster recovery biz

Beginner's guide to SSL certificates

More from The Register

next story
The 'fun-nification' of computer education – good idea?
Compulsory code schools, luvvies love it, but what about Maths and Physics?
Facebook, Apple: LADIES! Why not FREEZE your EGGS? It's on the company!
No biological clockwatching when you work in Silicon Valley
Happiness economics is bollocks. Oh, UK.gov just adopted it? Er ...
Opportunity doesn't knock; it costs us instead
Lords take revenge on REVENGE PORN publishers
Jilted Johns and Jennies with busy fingers face two years inside
Ex-US Navy fighter pilot MIT prof: Drones beat humans - I should know
'Missy' Cummings on UAVs, smartcars and dying from boredom
Yes, yes, Steve Jobs. Look what I'VE done for you lately – Tim Cook
New iPhone biz baron points to Apple's (his) greatest successes
Sysadmin with EBOLA? Gartner's issued advice to debug your biz
Start hoarding cleaning supplies, analyst firm says, and assume your team will scatter
Edward who? GCHQ boss dodges Snowden topic during last speech
UK spies would rather 'walk' than do 'mass surveillance'
Doctor Who's Flatline: Cool monsters, yes, but utterly limp subplots
We know what the Doctor does, stop going on about it already
prev story

Whitepapers

Forging a new future with identity relationship management
Learn about ForgeRock's next generation IRM platform and how it is designed to empower CEOS's and enterprises to engage with consumers.
Why and how to choose the right cloud vendor
The benefits of cloud-based storage in your processes. Eliminate onsite, disk-based backup and archiving in favor of cloud-based data protection.
Three 1TB solid state scorchers up for grabs
Big SSDs can be expensive but think big and think free because you could be the lucky winner of one of three 1TB Samsung SSD 840 EVO drives that we’re giving away worth over £300 apiece.
Reg Reader Research: SaaS based Email and Office Productivity Tools
Read this Reg reader report which provides advice and guidance for SMBs towards the use of SaaS based email and Office productivity tools.
Security for virtualized datacentres
Legacy security solutions are inefficient due to the architectural differences between physical and virtual environments.