IBM 2Q10 Earnings Debrief: Up, Up, and Up
This afternoon IBM announced it’s 2Q10 earnings. This is the thirtieth straight quarter of IBM earnings per share growth.
Following are some of the key headlines:
- Diluted earnings per share of $2.61, up 13 percent
- 30 consecutive quarters of EPS growth, 12 of last 14 at double digits
- Full-year 2010 EPS expectations raised to at least $11.25
- Net income of $3.4 billion, up 9 percent
- Pre-tax income of $4.6 billion, up 7 percent;
- Pre-tax margin of 19.3 percent, up 1 point
- Revenue of $23.7 billion, up 2 percent, as reported and adjusting for currency
- Growth markets revenue up 14 percent; first-half revenue as large as total Euro zone revenue; BRIC countries revenue up 22 percent
- Business Analytics revenue up 14 percent
- Software revenue up 2 percent, 6 percent excluding divested PLM operations
- Systems and Technology revenue up 3 percent
- Services revenue up 2 percent
- Services backlog of $129 billion, up $1 billion, adjusting for currency.
IBM had a second-quarter 2010 diluted earnings of $2.61 per share compared with diluted earnings of $2.32 per share in the second quarter of 2009, an increase of 13 percent.
Second-quarter net income was $3.4 billion compared with $3.1 billion in the second quarter of 2009, an increase of 9 percent.
Total revenues for the second quarter of 2010 of $23.7 billion increased 2 percent (2 percent, adjusting for currency) from the second quarter of 2009.
The impact of changes in currency rates since IBM’s first-quarter earnings report in April reduced revenue by approximately $500 million in the second quarter.
“In the second quarter we again delivered double-digit earnings-per-share growth, increased margins, as well as improving constant-currency revenue performance in our ongoing software, services and hardware businesses, and in all geographies,” said Samuel J. Palmisano, IBM chairman, president and chief executive officer.
“With the benefit of our strategic growth investments, our mix of higher-value business and the introduction of new System z and Power Systems, we are confident of our ability in the second half of the year to continue our strong business performance, grow profit and drive shareholder returns. As a result, we expect full-year 2010 diluted earnings per share of at least $11.25.”