IBM reports earnings of $2.80 per share, which beat the Street consensus estimate of $2.64. Quarterly revenue comes in at $16.977 billion, which beat the consensus estimate of $16.576 billion.
00:31IBM reported quarterly earnings of 280 per share, which beat the street consensus estimate of 264 per share.
00:37Quarterly revenue came in at 16.977 billion, which beat the consensus estimate of 16.576 billion.
00:45Here are some of the highlights.
00:46Revenue of 17 billion, that's up 8% and 5% at constant currency.
00:51Software revenue up 10%, which is up 8% at constant currency.
00:56Consulting revenue up 3% flat on constant currency.
01:00And infrastructure up 14%, that was up 11% at constant currency.
01:05So good metrics there.
01:07Gross profit margin, 60.1%.
01:09That's up 230 basis points.
01:11And pre-tax income margin, 18.8%.
01:14That's up 110 basis points.
01:16Special K here saying IBM should have been the king of AI.
01:20I completely agree.
01:21And I still think that IBM, because they're viewed as legacy tech, they don't quite get the full appreciation for what they mean for IBM.
01:32Remember Watson?
01:33That was like the first AI, right?
01:35And so your comment here about them being king, I agree.
01:39I feel like they had such a head start.
01:42They really should have executed on this.
01:44I think part of that was probably some of the innovation.
01:47That being said, because they're so deeply interwound into business and infrastructure, I actually think IBM can still make some headway here.
01:56But we'll see.
01:57Once again, or excuse me, quote, we once again exceeded expectations for revenue, profit, and free cash flow in the quarter.
02:05IBM remains highly differentiated in the market because of our deep innovation and domain expertise, both crucial in helping clients deploy and scale AI.
02:14And this is kind of what I'm talking about with that infrastructure.
02:16They're still going to be relevant.
02:18Despite being legacy tech and despite perhaps botching being the leader in AI, they're still going to be relevant, and it's still going to drive a lot of business here.
02:26Our generative AI book of business continues to accelerate and now stands at more than $7.5 billion.
02:32And that comes from Arvid Krishna, the IBM CEO.
02:37The outlook here with our strong first half performance, we are raising our full year outlook for free cash flow, which is expected to exceed $13.5 billion.
