IBM’s Q1 results once again underline the tech giant’s ability to increase profits in a low-growth market. For while revenue in the three months to March was flat at $24.7bn (or up 1% in constant currency), net income grew 7% and the company has nudged up its EPS target for the year from at least $14.16 to at least $14.27.
It’s not that IBM doesn’t have growth within its business. The BRIC (Brazil, Russia, India and China) countries were up 10%. And software showed growth once again, up 5% (or 7% in constant currency). But overall services were flat, including a 2% fall in Global Business Services, and hardware was down 7%. Meanwhile, Europe as a whole continues to be tough for IBM, although the UK and Spain have again delivered growth (see IBM: thumbs up for software (and the UK)).
IBM’s shares are down 2% in after hours trading, cancelling out the gains they made prior to the results release in yesterday's session. We’ll have a deeper delve into IBM’s numbers and outlook in a HotViewsExtra piece to be published later today.