- IBM’s fourth-quarter revenue was $17.55 billion, which is an increase of 1% year-over-year, meeting analysts’ expectations of $17.54 billion.
- The software revenue was $7.92 billion, up 10% compared to the previous year, slightly below the estimated $7.95 billion.
- The consulting segment saw a decline, with revenues at $5.18 billion, which is 2% lower than the previous year and short of the $5.27 billion estimate.
- Infrastructure revenue dropped by 7.6% year-over-year to $4.26 billion, although it exceeded the forecasted $4.13 billion.
- Financing revenue decreased by 2.9% to $170 million, falling short of the expected $174.9 million.
- “Other” revenue saw a significant decline of 79%, totaling $29 million.
- IBM reported an adjusted gross margin of 60.6%, slightly above the previous year’s 60.1% and meeting the estimate of 60.5%.
- Operating earnings per share (EPS) stood at $3.92, up from $3.87 in the previous year and surpassing the estimate of $3.74.
- Free cash flow increased by 1.2% to $6.16 billion, exceeding the estimated $5.63 billion.
- The company forecasts a revenue growth of at least 5% for the year, compared to an estimate of 4.81%.
- IBM expects free cash flow to reach approximately $13.5 billion for the year, higher than the anticipated $12.92 billion.
- 2024 financials include impacts from significant non-cash pension settlement charges, totaling $2.7 billion in Q3 and $0.4 billion in Q4.
- The generative AI sector of the business has grown significantly, now valued at over $5 billion, up nearly $2 billion from the previous quarter.
- By the end of Q4, IBM held $14.8 billion in cash, restricted cash, and marketable securities, an increase of $1.3 billion from the end of 2023.
- The total debt was reduced by $1.6 billion from the end of 2023, bringing it to $55 billion, inclusive of $12.1 billion in IBM Financing debt.
International Business Machines on Smartkarma
On Smartkarma, various independent analysts have published research on International Business Machines Corporation (IBM), offering insights into different aspects of the company. For example, Tech Supply Chain Tracker highlighted IBM’s strategic focus on hybrid cloud and artificial intelligence, which are core elements driving growth and client engagement. Baptista Research evaluated the shifting competitive landscape and erosion of switching costs affecting IBM, noting strengths in software but weaknesses in consulting due to macroeconomic challenges. Additionally, Tech Supply Chain Tracker discussed IBM’s recent decision to pull out its research and development units in China due to declining business and following a trend of U.S. tech firms scaling back their presence in the country.
Among the analysts covering IBM on Smartkarma, sentiments varied from bullish to bearish. While some analysts like Tech Supply Chain Tracker had a positive outlook on IBM, focusing on the company’s technological advancements and market positioning, others like Caixin Global reported on the challenges IBM faced in China, leading to a bearish sentiment. Each research report provides a unique perspective on IBM’s current status, future prospects, and potential risks, giving investors a comprehensive view of the factors influencing the company’s performance and stock valuation.
A look at International Business Machines Smart Scores
| Factor | Score | Magnitude |
|---|---|---|
| Value | 2 | |
| Dividend | 4 | |
| Growth | 4 | |
| Resilience | 2 | |
| Momentum | 4 | |
| OVERALL SMART SCORE | 3.2 |
Smart Score is a compound score for the Company indicating its overall outlook. It is derived by taking an equally weighted average of underlying Factor scores computed by Smartkarma
International Business Machines Corporation (IBM) has received generally positive scores across various factors according to Smartkarma’s Smart Scores. With high scores for Dividend, Growth, and Momentum, IBM appears to be in a strong position for long-term growth and shareholder returns. The company has a solid track record of paying dividends, indicating a stable financial performance. Furthermore, its strong growth and momentum scores suggest that IBM is well-positioned to capitalize on future opportunities and maintain a competitive edge in the market.
Despite lower scores in Value and Resilience, International Business Machines Corporation continues to be a key player in providing computer solutions using advanced information technology. While these scores may indicate areas for improvement, IBM’s global presence and diverse range of products and services remain notable strengths. Overall, IBM’s positive scores in Dividend, Growth, and Momentum bode well for its long-term outlook as a leading provider of technology solutions in the industry.
Disclaimer: This article by Smartkarma is general in nature and based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Note that our articles may not factor in the latest price-sensitive company announcements or qualitative material.
While all reasonable care has been taken in the preparation, Smartkarma makes no assurance about the accuracy of any generated data or content. All content is indicative only and should be independently checked for accuracy and confirmed before use. Smartkarma accepts no responsibility for any loss or damage caused as a result of any inaccuracy or error within the Lab online tools or generated data.
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