International Business Machines Earnings: Here’s Why Investors are Excited Now

International Business Machines Corp. (NYSE:IBM) delivered a profit and beat Wall Street’s expectations, BUT came up short on beating the revenue expectation. The revenue miss is a negative sign to shareholders seeking high growth out of the company. Shares are up 2.58%.

International Business Machines Corp. Earnings Cheat Sheet

Results: Adjusted Earnings Per Share increased 11.4% to $3.91 in the quarter versus EPS of $3.51 in the year-earlier quarter.

Revenue: Decreased 3.33% to $24.92 billion from the year-earlier quarter.

Actual vs. Wall St. Expectations: International Business Machines Corp. reported adjusted EPS income of $3.91 per share. By that measure, the company beat the mean analyst estimate of $3.77. It missed the average revenue estimate of $25.37 billion.

Quoting Management: “In the second quarter, we delivered strong performance in our higher-value software and mainframe businesses and again significantly increased our services backlog on growth in new business,” said Ginni Rometty, IBM chairman, president and chief executive officer.

Key Stats (on next page)…

Revenue increased 6.48% from $23.41 billion in the previous quarter. EPS increased 30.33% from $3.00 in the previous quarter.

Looking Forward: Analysts have a more negative outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings has fallen from a profit of $3.94 to a profit $3.92. For the current year, the average estimate has moved down from a profit of $16.77 to a profit of $16.64 over the last ninety days.

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(Company fundamentals provided by Xignite Financials. Email any earnings discrepancies to earnings [at]