IBM reports 20 percent jump in Q3 net income

IBM on Wednesday reported a 20 percent increase in net income for its third quarter reaching $2.8 billion.

IBM on Wednesday reported a 20 percent increase in net income for its third quarter and said its profit outlook for the full year remains on track.

The preannouncement came one week before IBM is due to report its full financial results on Oct. 16 and may help calm technology investors, who have been pummelling stocks amid fears of a spending slowdown caused by the U.S. financial crisis.

On Monday, software vendor SAP said concern about the financial crisis among its customers led to a "very sudden and unexpected drop in business activity" at the end of its third quarter.

IBM suggested that the broad scope of its business will help it to better weather the crisis.

"Our results demonstrate that the combination of a steady base of recurring revenue and profits, investments for growth in emerging markets, a range of products and services that deliver value to clients, and a strong and flexible financial foundation give IBM a competitive edge in good times and tough times,” Sam Palmisano, IBM's chairman, president and CEO, said in a statement. “We remain confident in our full-year outlook."

IBM reported revenue for the third quarter of US$25.3 billion, up 5 percent from the year before, including 3 percentage points from favorable exchange rates. Net income climbed 20 percent to US$2.8 billion, with earnings per share up 22 percent to $2.05.

The earnings beat the expectations of financial analysts by $0.03 per share, but the revenue figure is considerably lower than the analyst forecast of $26.5 billion.

IBM reaffirmed its full-year outlook for earnings per share of at least $8.75, which would be an increase of 22 percent over fiscal 2007 and one penny short of the analyst forecast. IBM didn't provide a revenue estimate for the full year.

Shares in IBM were down 5 percent at the close of normal trading Wednesday, at $90.55. They had climbed 4 percent higher in trading after hours at the time of this report.

Join the newsletter!

Or

Sign up to gain exclusive access to email subscriptions, event invitations, competitions, giveaways, and much more.

Membership is free, and your security and privacy remain protected. View our privacy policy before signing up.

Error: Please check your email address.

Tags IBM

Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

James Niccolai

IDG News Service
Show Comments

Father’s Day Gift Guide

Most Popular Reviews

Latest Articles

Resources

PCW Evaluation Team

Luke Hill

MSI GT75 TITAN

I need power and lots of it. As a Front End Web developer anything less just won’t cut it which is why the MSI GT75 is an outstanding laptop for me. It’s a sleek and futuristic looking, high quality, beast that has a touch of sci-fi flare about it.

Emily Tyson

MSI GE63 Raider

If you’re looking to invest in your next work horse laptop for work or home use, you can’t go wrong with the MSI GE63.

Laura Johnston

MSI GS65 Stealth Thin

If you can afford the price tag, it is well worth the money. It out performs any other laptop I have tried for gaming, and the transportable design and incredible display also make it ideal for work.

Andrew Teoh

Brother MFC-L9570CDW Multifunction Printer

Touch screen visibility and operation was great and easy to navigate. Each menu and sub-menu was in an understandable order and category

Louise Coady

Brother MFC-L9570CDW Multifunction Printer

The printer was convenient, produced clear and vibrant images and was very easy to use

Edwina Hargreaves

WD My Cloud Home

I would recommend this device for families and small businesses who want one safe place to store all their important digital content and a way to easily share it with friends, family, business partners, or customers.

Featured Content

Product Launch Showcase

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?