Turbotodd

Ruminations on IT, the digital media, and some golf thrown in for good measure.

IBM 4Q 2012 Earnings Rise On Software Sales

with 3 comments

IBM announced this afternoon fourth-quarter 2012 diluted earnings of $5.13 per share, compared with diluted earnings of $4.62 per share in the fourth quarter of 2011, an increase of 11 percent.

Fourth-quarter net income was $5.8 billion compared with $5.5 billion in the fourth quarter of 2011, an increase of 6 percent. Total revenues for the fourth quarter of 2012 of $29.3 billion decreased 1 percent (flat adjusting for currency) from the fourth quarter of 2011.

“We achieved record profit, earnings per share and free cash flow in 2012. Our performance in the fourth quarter and for the full year was driven by our strategic growth initiatives — growth markets, analytics, cloud computing, Smarter Planet solutions — which support our continued shift to higher-value businesses,” said Ginni Rometty, IBM chairman, president and chief executive officer.

“Looking ahead, we continue to invest to deliver innovations for the enterprise in key areas such as big data, mobile solutions, social business and security, while expanding into new markets and reaching new clients. We are well on track toward our long-term roadmap for operating EPS of at least $20 in 2015.”

Following are key details of 4Q 2012 earnings:

Fourth-Quarter 2012

Diluted EPS:

GAAP: $5.13, up 11 percent;

Operating (non-GAAP): $5.39, up 14 percent;

Net income:

GAAP: $5.8 billion, up 6 percent;

Operating (non-GAAP): $6.1 billion, up 10 percent;

Gross profit margin:

GAAP: 51.8 percent, up 1.8 points;

Operating (non-GAAP): 52.3 percent, up 2.1 points;

Revenue of $29.3 billion, down 1 percent, flat adjusting for currency:

Up 1 percent excluding divested RSS business adjusting for currency;

Free cash flow of $9.5 billion, up $0.6 billion;

Software revenue up 3 percent, up 4 percent adjusting for currency;

Services revenue down 2 percent, down 1 percent adjusting for currency;

Services backlog of $140 billion, flat, up $1 billion adjusting for currency;

Systems and Technology revenue down 1 percent, up 4 percent excluding RSS:

System z mainframe up 56 percent.

Full Year 2012

Diluted EPS, up double-digits for 10th consecutive year:

GAAP: $14.37, up 10 percent;

Operating (non-GAAP): $15.25, up 13 percent;

Net income:

GAAP: $16.6 billion, up 5 percent;

Operating (non-GAAP): $17.6 billion, up 8 percent;

Revenue of $104.5 billion, down 2 percent, flat adjusting for currency;

Free cash flow of $18.2 billion, up $1.6 billion;

Growth markets revenue up 4 percent, up 7 percent adjusting for currency:

BRIC countries up 7 percent, up 12 percent adjusting for currency;

Business analytics revenue up 13 percent;

Smarter Planet revenue up more than 25 percent;

Cloud revenue up 80 percent.

Full-Year 2013 Expectation:

GAAP EPS of at least $15.53 and operating (non-GAAP) EPS of at least $16.70.

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Written by turbotodd

January 22, 2013 at 9:45 pm

3 Responses

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  1. what does IBM lump into “cloud” revenue — any idea?

    Barb Darrow

    January 23, 2013 at 3:22 pm

    • Barb, IBM includes in its revenue figure for cloud its IBM SmartCloud portfolio, including foundations, services, and SaaS, and both public and private clouds (hardware, software, and services).

      turbotodd

      January 23, 2013 at 6:18 pm

      • thnks. that’s what i thot and ibm has since confirmed that.

        Barb Darrow

        January 23, 2013 at 10:06 pm


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