Netease Technology News on January 22, according to foreign media reports, local time on Tuesday,
IBM announced the fourth quarter of the fiscal year 2019 as of December 31. The report shows that IBM’s revenue for the quarter was $ 21.8 billion, an increase of nearly 0.1% over the same period last year. Wall Street had previously forecasted $ 21.6 billion; net profit was $ 3.67 billion, an increase of 88.1% over the same period last year.
IBM’s fourth-quarter revenue exceeded analysts’ expectations, breaking the unfavorable situation of five consecutive quarters of decline, and also from the side that the company’s efforts to enter the hybrid cloud market have begun to show benefits.
After the announcement of the financial report, the company’s stock rose sharply 4% in after-hours trading.
The increase comes from the completion of IBM’s acquisition of Red Hat in the third quarter of last year, driving the cloud computing and cognitive software divisions to grow 8.7% year-on-year. IBM’s cloud computing business had total revenue of $ 6.8 billion, a record high.
IBM CEO Ginni Rometty pinned the company’s future on the hybrid cloud market. Hybrid clouds allow companies to store data on private clouds as well as multiple public cloud servers.
In 2018, IBM bought Red Hat for $ 34 billion to advance this strategy. The company plans to use Red Hat to provide enhanced security services and applications in the hybrid cloud.
Red Hat contributed $ 1 billion in revenue to IBM in the fourth quarter. But according to US accounting standards, IBM was only allowed to confirm $ 573 million of it. Excluding some costs, IBM reported earnings of $ 4.71 per share, exceeding analysts’ average estimate of $ 4.69. The company also said that it expects adjusted earnings per share of at least $ 13.35 in 2020, which is higher than the Wall Street forecast of $ 13.29.
The global technology services business, which accounts for about 30% of IBM’s total revenue, continues to decline. Revenues from the technology consulting division were $ 6.9 billion, down 4.8% from the same period last year. The global business services sector was $ 4.2 billion, down 0.6% from a year earlier.
IBM was once a global leader in technology but has been behind its competitors for years after missing the cloud computing revolution. “The company has been struggling with a fiery tech bull market,” said Ivan Feinseth, an analyst at Tigress Financial, a U.S. investment bank. “All types of technology companies except IBM are growing.”
For a long time, IBM has been unable to achieve revenue growth, which is a factor dragging down the stock price. IBM shares closed at $ 139.17 on Tuesday, a slight increase of 0.62%. After the earnings report, the company’s stock rose about 4% to $ 144.50 in after-hours trading.