IBM turned in its third-quarter results, beating expectation on strong hybrid cloud results.
IBM has been focusing its attention on cloud computing, even planning to split in two in order to divest itself of its legacy business and focus its efforts on the cloud. The strategy is paying off, with the company reporting a strong third quarter.
“IBM delivered strong revenue growth in the quarter, reflecting our continued focus on the execution of our strategy. Globally, clients view technology as an opportunity to enhance their business, which is evident in the results across our portfolio,” said Arvind Krishna, IBM chairman and chief executive officer. “With our year-to-date performance, we now expect full-year revenue growth above our mid-single digit model.”
Revenue came in at $14.1 billion, up 6% over last year and beating expectations of $13.5 billion. Software revenue increased 7%, consulting revenue 5%, and infrastructure revenue was up 15%.
Hybrid cloud revenue was up 15%, coming in at $22.2 billion over the last 12 months.
“Both our revenue growth and operating profit profile for the first three quarters of the year align to the investment thesis we outlined last fall,” said James Kavanaugh, IBM senior vice president and chief financial officer. “Our portfolio mix, business fundamentals, strong recurring revenue stream and solid cash generation allow us to invest for continued growth and return value to shareholders through dividends.”