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Big Blue Sees Green In Second Quarter

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[ Business]

IBM reported earnings were up in the wake of its personal computing business sale to Lenovo.

IBM announced earnings of $1.14 per share for the second quarter. That compares with $1.01 per share reported for the second quarter in 2004.

A restructuring charge of $1.7 billion USD was offset by a $1.1 billion gain from the sale of IBM’s personal computing business to Chinese computer maker Lenovo. Also, IBM settled a long-simmering dispute with Microsoft and received $775 million from them.

IBM’s total revenues of $22.3 billion for the quarter showed a 4 percent decrease from 2nd quarter 2004. The company had PC revenue of $557 million for April of this year, which was the last month the PC business belonged to IBM.

“IBM Business Consulting Services posted an outstanding quarter, with strong revenue growth and a 30 percent increase in signings. This performance reinforces our confidence in our business model,” said IBM CEO Sam Palmisano.

That model has seen the company focus more on the service side of the technology industry. The sale of the PC business, with its thin margins and brutal competition, demonstrates IBM’s shift. But the company also has built the top two supercomputers in the world and the majority of the top 500 overall, so its other hardware lines aren’t going to disappear anytime soon.

David Utter is a staff writer for WebProNews covering technology and business. Email him here.

Big Blue Sees Green In Second Quarter
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