IBM posts strong Q4 results, no layoffs announced

21.01.2009
IBM on Tuesday reported fourth-quarter fiscal 2008 earnings of US$3.28 per share, a 17 percent increase year-over-year, but said total revenue for the quarter dropped 6 percent to $27 billion.

Analysts polled by Thomson Reuters had on average earnings of $3.03 per share and $28.15 billion in revenue.

Net income for the fourth quarter was $4.4 billion, a 12 percent increase over 2007. For the full year, IBM posted company records for revenue, with $103.6 billion; pre-tax profit, with $16.7 billion; and earnings per share at $8.93.

The company said it expected earnings per share of at least $9.20 in 2009. Chief Financial Officer Mark Loughridge said he expects the first half of next year to be more difficult than the second. Revenue growth will be relatively flat in the first quarter but then expand, he added.

IBM said the strong dollar contributed to its drop in fourth-quarter 2008 revenue. When adjusted for currency fluctuations, revenue would have fallen 1 percent, the company said.

Software revenue grew 3 percent, but Global Technology Services and Global Business Services fell 4 percent and 5 percent, respectively, an indication that customers are pulling back somewhat on IT projects. However, IBM also reported service engagements worth $17.2 billion, including some 24 deals with a price tag higher than $100 million.