IBM (IBM) reported third-quarter results late Wednesday that beat analysts’ expectations as the tech giant’s chief executive boosted the company’s full-year revenue outlook. IBM shares rose sharply on the news.
The company reported adjusted EPS of $1.81 on revenue of $14.1 billion. Analysts expect IBM to report adjusted earnings of $1.79 on revenue of $13.55 billion. According to the fact set.
Revenue rose 4.6% year over year. About half of IBM’s revenue comes from overseas. Revenue rose 15% in constant currency, the company said.
In after-hours trading, IBM shares surged 4.8% to 128.40 in the stock market today.
IBM Stock: Company Raises Revenue Outlook
“IBM delivered strong revenue growth in the quarter, reflecting our continued focus on strategy execution,” the CEO said Arvind Krishna, in written comments. “With our year-to-date performance, we now expect full-year revenue growth to be above our mid-single-digit model.”
In the third quarter, IBM reported software revenue of $5.81 billion, up 7.5%, beating estimates of $5.54 billion. It reported consulting revenue of $4.7 billion, up 5.5% and also beating expectations. Cloud revenue rose 11% to $5.2 billion.
Over the past decade, IBM has invested more than $120 billion to transform the company. This includes $29 billion in capital expenditures to expand its cloud operations and artificial intelligence offerings and enhance its security and services capabilities.
“Our revenue growth and operating profit profile for the first three quarters of the year is consistent with the investment thesis we outlined last fall,” IBM CFO James Kavanaugh says in written comments. “Our portfolio, business fundamentals, strong recurring income stream and solid cash generation allow us to invest for continued growth and return value to shareholders through dividends.”
IBM stock has an IBD Composite Rating of 73 out of 99.
Follow Brian Deagon on Twitter @IBD_BDeagon Learn more about tech stocks, analytics and financial markets.
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