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IBM Gains In Cloud, Mobile, Security Businesses In First-Quarter Earnings

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IBM Gains In Cloud, Mobile, Security Businesses In First-Quarter Earnings

The figures of the first quarter 2016 earnings of IBM Corp show that the organisation has gained immensely in the next generation segments such as cloud, mobile and security businesses.


In one year, the cloud revenue of IBM has increased by 34% reaching $10.8 billion. Similarly the mobile business has witnessed an increase of 88%. IBM’s security business recorded a growth of 18% in the quarter. Revenue from analytics increased 7%. Overall, the cloud, mobile computing, data analytics, social and security software together made a 14% rise in the first quarter.

Commenting on the performance of the company in this quarter, Ginni Rometty, IBM Chairman, President and Chief Executive Officer said, “We are pleased with the progress we have made helping our clients apply new cognitive solutions and hybrid cloud platforms. IBM has established itself as the industry leader in total cloud, analytics and cognitive, all of which helped drive our strategic imperatives revenue growth at a strong double-digit rate, substantially faster than the market.”

On the other side, IBM reported a decline in its traditional businesses, sending shares down nearly 5% in extended trading. The success of next-generation business failed to maintain the grasp of the overall revenue, which fell 4.6% to $18.68 billion in the Q1 2016. This is the 16th quarter revenue decline for IBM.

The revenue from the services fell 4.3% and the earnings from hardware segment fell 21.8% in the quarter.

“In the first quarter, we invested $3.6 billion in acquisitions and capital expenditures, and returned $2.2 billion to shareholders through dividends and gross share repurchases,” said Martin Schroeter, IBM senior vice president, and chief financial officer.  “We will continue to invest as we transform our operations, expanding our industry expertise and our cognitive and cloud capabilities.”

The company generated free cash flow of $2.3 billion in the first quarter. IBM ended the first-quarter 2016 with $14.9 billion of cash on hand, an increase of $6.7 billion since year-end 2015.  Debt, including Global Financing debt of $26.8 billion, totaled $45.6 billion, compared with $39.9 billion at year-end 2015. In short, the balance sheet of IBM remains strong and steady to support business over the long term.


Ria Lakshman. V is a lead news writer at The Telecom Times. She studied Journalism at Manipal School of Communication and proceeded to work in newspapers and magazines, with technology as her focus area. Passionate about Telecommunications sector, her move to 'The Telecom Times' was a natural choice. Alongside, she also writes for Telecom Talk, where she covers news and tech commentaries in the sector of telecom. In the free time, Ria loves to go camping, read books, or sketch illustrations. She also runs a local design studio and promotes eco-friendly crafts. Ria can be found sharing her knowledge and insights on Twitter.



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